The absence management conversation is a critical component of every employer’s broader employee benefit strategy discussion these days, especially given the competitive talent market and the rapidly evolving regulatory landscape surrounding leave of all types and at all levels (federal, state, local). Now, more than ever, employers and employees need to understand how all available benefits, including supplemental health plans, such as Accident, Critical Illness, and Hospital Indemnity, work together. Compliance isn’t the only consideration, though. Employers need to be sure not to duplicate processes which can increase costs as well as to ensure a smooth and positive employee experience.

Understanding supplemental health products and the benefits provided by them ensures that those paying for the coverage will fully utilize the benefits available. Since Accident, Critical Illness, and Hospital Indemnity benefits are paid when an accident occurs, a critical illness is diagnosed, or a hospital stay is required due to injury or illness, they offer a way to fill in the financial gaps left by traditional health insurance, disability coverage, and paid leave benefits. The lump sum benefits paid by the supplemental health plans can be used to cover out-of-pocket expenses like medical copays and deductibles, as well as to supplement the income replacement benefits provided by paid leave and/or disability plans.

The good news is that insurance carriers have made significant progress over the last few years toward the integration of absence and supplemental health products.1 Many are, now, not only bundling supplemental health products with their core disability and absence products and offering a package discount to the core products when quoting, but also tackling the more complex issue of how to ensure that employees enrolled in supplemental health plans are receiving the financial benefit of the products they pay for with payroll deductions.

To ensure that supplemental health plan participants receive the benefits they are entitled to under their policies, most carriers are digging into questions like:

  • How can they identify disability and leave claimants who are also enrolled in one or more supplemental health product(s)?
  • Is there a way to leverage the claim information obtained during the leave and disability claim process(es) to pay supplemental health claims without having to request redundant or additional medical information?

Carriers are also reviewing their processes to find efficiencies and create a better claimant experience. This internal retrospection has led to things like coordinated leave, disability, and supplemental health claim intake and the sharing of medical information across all claims. Many carriers are not only building out coordinated claim paths and workflows for leave, disability, and supplemental health claims, but they are also having their leave and disability claim specialists conduct routine analysis of current leave and disability claim files to see what other coverages an insured is eligible for and whether the medical information on file could be used to adjudicate the corresponding supplemental health benefit claims. Some carriers who have access to medical claim files offer auto-generated notifications, which are sent to supplemental health plan participants, reminding them of their supplemental health benefits based on the medical claim data. Software and technology companies as well as third-party administrators (TPAs) who often handle leave benefit administration are also focused on product improvements in the areas of artificial intelligence (AI), automations, self-service portals, communications, intake, and reporting. All these claim process adaptations alleviate steps for the insured and make it easier, overall, for them to know what benefits are available and be able to utilize them. They also help claimants to maximize the value of the benefits for which they are paying and enhance the customer experience that is top of mind for employers of all types, sizes, and industries.

1 Spring Consulting Group.  2022-2023 Integrated Disability, Absence, and Health and Productivity Vendor Benchmarking Survey.