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How the pandemic is shifting workplace benefits: Prepaid legal plans, IT help desks for kids

Employers are also expanding hospital coverage, mental health benefits and access to telehealth platforms

Staff members check on a patient at the covid-19 intensive care unit of United Memorial Medical Center in Houston on Nov. 8. As concerns over the coronavirus pandemic rise, employers are reconsidering the medical benefits they offer. (Go Nakamura/Bloomberg News)

Like many things in 2020, employee benefits and perks are being reshaped by the coronavirus pandemic.

This open enrollment season — the period in late fall when workers choose benefits for the following year — employers are offering more voluntary medical benefits like “hospital indemnity” plans, paying for couples therapy and providing access to prepaid legal plans for workers concerned about getting their end-of-life affairs in order.

In addition to providing more time off or flexibility for child care — perks that have received much attention as the pandemic has dragged on — employers are also offering workers far more access to telehealth platforms and mental health benefits.

“The big realization a lot of these companies have had during the pandemic is that there’s so much that happens in your personal life that affects your work,” said Brian Kropp, a vice president for the advisory firm Gartner.

A survey by the Business Group on Health, an advocacy group that represents large employers, found that for 2021, 53 percent of its members plan to expand virtual care options, while 36 percent plan to expand access to mental health services.

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“We saw astronomical growth year over year” in virtual health benefits, as well as expansions in mental health benefits, said Ellen Kelsay, the group’s chief executive.

As Expedia Group employees register for 2021 benefits this month, they will have several new options to choose from, including access to the online therapy platform Talkspace, said Sarah Gavin, vice president of global communications. Expedia employees also will be offered expanded access to out-of-network mental health providers, the company said.

Yet in a year when the economy is sputtering, many of the new benefits companies are offering are “voluntary” — costing employers nothing but giving workers access to services at lower prices than employees can access on their own.

“The biggest shift we saw was the addition of voluntary benefits, because that had zero or no budget impact,” said Dani McCauley, a senior vice president at the consulting firm Aon, adding that the percentage of clients it surveyed who planned to offer such benefits doubled or even tripled over the past year, depending on the benefit.

These include “hospital indemnity” or “critical illness” policies, in which employees pay a small monthly premium but receive a cash payout or lump sum to help pay expenses if they are hospitalized or diagnosed with certain critical illnesses. These have grown in popularity amid fears about the pandemic, said benefits consultants, who note that not all of the critical illness policies cover covid-19, the disease cause by the novel coronavirus.

Another voluntary benefit that’s taking off is identity theft protection, according to benefits consultants. The Federal Bureau of Investigation and Federal Trade Commission issued warnings about identity theft earlier this year, after reports of a surge in fraudulent unemployment insurance claims. The FTC also reported a spike in complaints about identity theft in April, when the first stimulus payments were issued.

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As concerns about fraud have risen, and as more employees work from home, employers have grown more concerned about the risks, said Lydia Jilek, a consultant with Willis Towers Watson, an advisory and risk management firm.

Allstate Identity Protection said in an email that it projects a 30 percent increase in the number of employee benefits clients by the end of this year, compared with 2019; another security services provider, NortonLifeLock, said it saw double-digit growth in its employee benefits program over the past three months.

Some companies are preparing for other potential consequences of all the extra time employees are spending at home with their families. Jilek said some companies have told her that they plan to add hospital indemnity plans as they expect more employee pregnancies and deliveries in 2021. “If you know you’re pregnant during open enrollment, it could make good sense” to add the hospital policy for the following year, she said.

Some employers are beginning to pay for couples therapy, especially large businesses in small communities where there may be more sets of married workers, said Kropp of Gartner. “When everyone is stuck at home, there’s more natural conflict,” he said.

MetLife’s head of group benefits, Todd Katz, said that in addition to employers’ making legal plans available, which cover items such as wills, trusts, real estate transactions and, in some cases, divorce, the insurer is seeing increased interest in supplemental life insurance benefits, as well as pet insurance.

“There’s a lot of pandemic puppies,” Katz said. “It all fits with the theme of … ‘We’re not going to pay for it, but we’re going to give you more options.’ ”

Big firms offer stressed parents new perks such as subsidized tutoring

Some employers are funding new benefits through a slight decrease in their expected health-care costs this year, according to Aon.

The amount spent on medical claims in 2020 by employers is projected to dip, on average, as spring lockdowns closed health-care providers or employees deferred care or elective surgeries, according to a new report from Aon. While there was some variation, it projects that most “self-funded” employers — large companies that are administered by an outside insurer, but pay benefit claims themselves — will spend less than what they budgeted per employee in 2020. “This is unprecedented,” said Tim Nimmer, Aon’s global chief actuary for health solutions.

Some are using that cost savings to manage their business — employers “in troubled industries are looking for every coin in the seat cushion,” Nimmer said. But others are putting the savings into benefits, such as reinstituting 401(k) matches or spending more on mental health. Next year, his firm forecasts employer medical claims will increase 2 percentage points above normal trends, as care that was postponed in 2020 takes place and covid-19 treatments continue.

Outside of benefits packages, some employers are also offering new perks relevant for remote work and school. Cisco, for instance, has begun reimbursing U.S. employees up to $35 monthly for Internet service; PwC began offering unlimited cellphone plan usage from any carrier to assist with remote working; and Okta, the identity management software firm, began repurposing company laptops for employees’ children, giving away 10 laptops a month to employees who are parents and have entered a lottery system.

Expedia told staff members in September that its travel reimbursement, a perk that ranges in value from $250 to $750 depending on employee service, could now be combined with a $600 wellness benefit and be spent on items such as grocery delivery charges, kids’ online tutoring, golf memberships and at-home coronavirus viral or antibody testing kits.

A few weeks later, the company began allowing workers’ children to call its IT help desk for assistance with tech problems during virtual schooling — even shipping out replacement laptops on a couple of occasions.

The help desk had some slack — with fewer people in the office, there were fewer on-site teleconferencing issues to sort out. “Frankly, it was either, let’s come up with something for these folks to do or we’d have to look at furloughing them,” Gavin said. “Everybody got to stay and be part of the solution.”

For working parents during the pandemic, Gavin said, “there’s just a thousand things you have to deal with. If you can even get that down to 900 things, that’s a win for employees.”