Ancillary Benefits: Why Employees Don't Use What You Buy

You're paying thousands annually for dental, vision, and disability coverage. But if your employees don't understand what they have, you might as well be lighting money on fire. Recent industry analysis shows that vision benefits often go unused at small companies, not because employees don't need eye care, but because they don't know their benefits exist or how to use them.

The Hidden Cost of Unused Benefits

Here's the problem: When employees don't understand their ancillary benefits, they can't appreciate them. When they can't appreciate them, they don't credit you as an employer. You're paying full premium for zero retention value.

Consider a Nassau County accounting firm paying $180 per employee annually for vision coverage. If only 30% of employees use it because the other 70% don't understand the benefit, that's $126 per unused employee - money that generates zero goodwill or loyalty. Multiply that across dental, life insurance, and disability coverage, and you're looking at substantial waste.

Why Employees Ignore Ancillary Benefits

The enrollment process at most small companies focuses heavily on medical plan selection. Ancillary benefits get glossed over in a rushed "oh, and you also have dental and vision" conversation. Employees walk away knowing they have something, but not what it covers or how to use it.

This knowledge gap has real consequences. An employee who pays out-of-pocket for dental cleaning because they forgot about their dental benefit isn't just wasting your premium dollars - they're missing the connection between their employer and their financial well-being.

The FSA and HSA Education Gap

Flexible Spending Accounts and Health Savings Accounts represent some of the most valuable ancillary benefits you can offer, yet they're consistently underutilized. HSA rules have become more employer-friendly, making these accounts even more valuable for your team.

But employees who don't understand the tax advantages or contribution limits can't maximize these benefits. An employee missing out on $1,000 in annual HSA contributions is losing $250-400 in tax savings - money that could have strengthened their loyalty to your company.

Life and Disability: The Forgotten Safety Net

Group life insurance and short-term disability often cost employers significant premiums, yet employees frequently have no idea what coverage amounts they have or how to file claims. When a Suffolk County employee faces a family emergency and discovers they have $50,000 in employer-paid life insurance they never knew about, that's a powerful moment of appreciation - but only if they make the connection.

More commonly, employees assume they need to purchase individual policies because they don't understand their group coverage. You're paying for protection they don't know they have.

Making Your Investment Count

The solution isn't cutting ancillary benefits - it's ensuring employees understand them. Comprehensive benefits education transforms unused perks into appreciated value.

Effective benefit communication includes specific examples: "Your dental plan covers two cleanings per year at 100% - that's $300 in savings." "Your HSA contribution of $2,000 saves you $500-800 in taxes annually." "Your employer pays for $25,000 in life insurance coverage - equivalent to a $200 annual premium you don't pay."

When employees understand the dollar value of what you provide, they begin to appreciate your investment in their financial security.

The ROI of Employee Education

Benefits education isn't just good employee relations - it's smart business. Employees who understand their complete compensation package are more likely to stay, more likely to refer quality candidates, and less likely to be swayed by competitors offering seemingly better packages.

A Long Island medical practice that invests 30 minutes educating each employee about their ancillary benefits transforms those premiums from costs into retention tools.

Don't let your ancillary benefits become invisible expenses. When employees understand and use what you provide, your benefits investment delivers the retention and recruitment value you're paying for. Benton Oakfield's enrollment education ensures your team actually knows what they have - so they can appreciate what you're providing.

Compliance Note: Benefit plan rules and tax implications vary based on company size and location. This summary is for informational purposes only. Please contact your Benton Oakfield representative to review how these changes impact your specific plan documents.

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