This article first appeared in BenefitsPro on July 9, 2025, written by Ann Clifford.
Year-over-year commercial healthcare spending is expected to grow by 8% in 2025 – the largest increase in over a decade.
As cost-conscious employers and employees head into peak open enrollment season, benefits advisors, especially those working with small to midsize businesses, have an opportunity to highlight why the current economic landscape makes supplemental health benefits more important than ever, especially for cost-conscious firms.1
“For small and midsize businesses that are often unable to match the compensation packages or comprehensive health insurance offered by larger employers, supplemental health benefits can help level the playing field in attracting and retaining talent,” says Seeta Nadeau, product management lead at The Hartford. “With no cost to the employer, the plans easily scale to fit business and employee needs.”
Successful supplemental health benefits strategies require benefits advisors to work closely with their small and midsize business clients to show how these products address current financial pressures. Advisors also play a key role in educating employees about the benefits and simplifying implementation, administration and enrollment.
Addressing Financial Pressures With Supplemental Health Benefits
Even with cost containment top of mind, employers want to provide high-value benefits that support employee well-being. Supplemental health benefits, including accident, critical illness and hospital indemnity insurance, can offer valuable financial protection for employees without increasing the company’s benefits budget.
Supplemental health benefits ease the economic pressures employees face during accidental injuries, serious illnesses or hospital stays. Employees can use the cash benefits (paid directly to them) for medical expenses not covered by traditional health insurance or everyday expenses like rent, groceries or child care.
“With inflation impacting everyday expenses, employees are seeking affordable, high value coverage,” Nadeau says. “Supplemental Health benefits can help offer financial peace of mind, reduce stress and improve overall well-being.”
Educating Employees on Benefits
While supplemental health benefits offer clear value, The Hartford’s Future of Benefits Study reveals that 38% of employees do not understand the supplemental health benefits offered by their employer, and 34% do not purchase the coverages because they do not think they will need them.2
Building employee understanding is crucial for maximizing the effectiveness of supplemental health benefit strategies. One key is explaining how the benefits address specific gaps, like out-of-pocket medical costs, unexpected expenses and lost income.
“Simplicity is essential for making benefits feel usable and real,” Nadeau says. “The typical employee isn’t an insurance professional, so we shouldn’t expect them to decode policy language. At The Hartford, we focus on simplifying benefits communications by using plain language, providing user-friendly explanations and sharing relatable stories about how supplemental health benefits can provide a financial safety net.”
Optimizing Employer and Employee Experiences
As the need for supplemental health benefits grows, employers – especially small to midsize businesses – need efficient ways to implement and manage them. The Hartford’s research reports that employers juggle an average of eight different HR responsibilities, making innovative tools and streamlined support critical.2
Benefits advisors can help by recommending digital tools, such as enrollment platforms and decision support tools, which allow employees to compare plans, calculate costs and enroll online. These tools simplify the process and help employees choose benefits that meet their specific needs.
Digital solutions should be paired with a human touch from onboarding through claims, Nadeau adds. “Being tech-forward is essential, but human interaction is vital for providing the support people need, minimizing friction and increasing employee understanding and utilization of supplemental health benefits,” she says.
With healthcare costs continuing to rise, supplemental health benefits will remain a valuable financial protection element within competitive benefits programs. Benefits advisors and consultants can help employers see the role supplemental health benefits play, increase employee understanding and make them easy to implement, enroll in and manage.
