Employee Benefits Are Disappearing Before Your Very Eyes

NEW YORK (MainStreet) — Employers are slashing major medical plan options even more and shifting costs to employees who are forced to find other alternatives such as opening a health savings account (HSA).

Changes in benefits are occurring because 49% of companies said that controlling costs is their top business issue, compared to only 28% in 2011, according to a recent survey from Aflac, a Columbus, Ga. provider of voluntary insurance. The study surveyed 1,856 employers and 5,209 employees at small, medium and large U.S. companies and sheds light on how companies are dealing with health care costs and how it affects workers.

Employees found that they were paying a higher rate for health insurance with 14% of businesses who reduced the number of major medical plan options, 56% who increased employees' co-payments and/or employees' share of premiums in 2013 and 19% of companies who implemented a major medical plan with a high deductible (over $1,000) and a HSA as an alternative to a traditional medical plan.

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"For four consecutive years, we have witnessed this growing trend and can foresee the possible ramifications for the U.S. workforce," said Teresa White, chief operating officer of Aflac Columbus. "When businesses make changes like delaying pay raises and increasing major medical deductibles and out-of-pocket costs, they can further destabilize the precarious financial position of many employees."

Companies are not only cutting back on medical plans, but also reducing other benefits with 32% of businesses who eliminated or delayed raises, 22% who eliminated or cut back on benefits and 21% who changed some full-time workers to part-time workers.

One option for employees is to purchase voluntary insurance policies such as accident, critical illness, hospital and disability for added protection, said Matthew Owenby, vice president of human resources for Aflac. Voluntary policies are designed to help pay for out-of-pocket expenses that can be associated with the rising cost of health care.