Having grown up as a pastor’s kid and worked over 10 years in the church myself, I can safely say that few things make your staff feel more cared for than your church’s health benefits. These packages can cover a vast range of things, from vacation time to retirement investments to helping ministers understand how to properly file their taxes with housing allowances.
Unfortunately, the church’s annual budget often dictates what is included in these benefits packages. Of course, that doesn’t change how essential these services remain to employees. This is why strategically prioritizing employee benefits is so important. Considering the number one cause of bankruptcy in the U.S. is medical expenses, focusing on generous health benefits should be essential.
In an effort to help you and your leadership make the best decisions in this painstaking process, we’ve put together 3 key things you can’t skip with church health benefits:
1. Mental Health
Mental health needs to be normalized in our conversations. Leading research group Barna has shared that only 17% of pastors’ mental health is excellent, as opposed to 39% just 4 years ago. Things are not getting better, but they can with the right awareness and support system.
Consider preventative health services, which are included for free with every health insurance plan. Although these services are available, not everyone knows about them or utilizes them. The purpose of preventative services is to prevent something worse from happening. Screenings, for example, help discover potential problems early on. Unfortunately, only 8% of people actually take advantage of this benefit.
When considering how these services pertain to mental health, I’m reminded of our recent conversation with co-founder of Timely MD (leader of telehealth and telemental services for higher-education students), Chris Clark. In that discussion, Clark highlighted that improving access to care will in turn improve usage.
Organizations like Crosswinds Counseling are able to design custom church health benefits packages to meet the needs and goals of each group with flexible care options. Leaders can help their teams have quality conversations with qualified providers sooner rather than later, which promotes better overall health and care.
2. HSA Dollars
Usually when people think of medical expenses, they picture surprise ER visits resulting in multi-thousand dollar bills. This isn’t always the case, though. In fact, the extent of most peoples’ encounters with medical facilities only include their standard annual checkups and vaccinations. The Department of Health and Human Services reports each American might make one extra visit beyond that.
This means that overspending on expensive copay plans is not only wasting money, it’s also wasting potential financial investments that could be saved over time and used toward those surprise medical expenses when it’s actually needed. This is exactly what makes Health Savings Accounts (HSA) an imperative benefit.
Unfortunately, HSA plans have gotten a bad rap, but it’s mainly because they’re often used incorrectly. Regularly, I hear people complain and say, “They don’t cover anything until the deductible is met!” Believe it or not, this is actually the purpose of High Deductible Health Plans (which qualify for HSAs).
HSAs are meant to be paired with HSA contributions, by either the employer or the employee. When this is done correctly, families are able to save up thousands of dollars every year, which can then be spent toward qualified medical expenses.
When first starting an HSA, it’s best to provide as close to the IRS limit as you can ($3,600 per individual and $7,200 for families). If your team is like the majority of Americans, they won’t spend their full HSA every year, which means they can roll over leftovers every year. This money can be used for anything from braces to chiropractic services to retirement and more!
3. Low Exposure
Did you know that in 2021, the standard out-of-pocket maximums of health insurance plans are $8,550 for an individual and $17,100 for a family? Keep in mind, this is different from the deductible (the two are often confused).
If you’re not sure what the difference is, you’re not alone. In fact, 96% of people don’t know, either.
An out-of-pocket max is the worst possible year financially for the family; i.e their actual risk. Only around 3-5% of people hit their out-of-pocket max every year. However, this means that every year, your staff has the chance of wracking up some tremendous medical debt if their exposure is high.
Thankfully, employers do have options to help their teams when those expensive medical needs arise. The employer could always spend more upfront as a way to “improve” the plan design (offer a plan with a lower out-of-pocket max). However, that would result in overspending on a plan design that may not be necessary.
This is why Health Reimbursement Arrangements (HRAs) are such a powerful tool to include with church health benefits. There are several ways to use HRAs, but the primary goal should be to lower the exposure of the team — improving their worst possible year.
Another good thing about an HRA, especially if you bolt it onto the backend of the plan, is that it will only kick in when there are substantial bills to pay. This strategy gives you a unique opportunity to care for your team when they need it most. Plus, HRA dollars do not rollover every year, which means if it’s not spent, it’s saved!
With the right church health benefits strategy, you can steward your resources better and care for your team when they need it most.
WageUp™ with Remodel Health helps with all 3 and more!
$23 million dollars have already been put back into mission. With 34% average savings for groups who switch to Remodel Health, just think of the impact that could make on your church.
Maybe you can upgrade your retirement offering. Maybe you will be able to make more hires. Or, maybe you can grow your new church plant! Go to remodelhealth.com/quiz to begin your free, full benefits evaluation!
Important Notice: Remodel Health does not intend to provide specific insurance, legal, or tax advice. Remodel Health always recommends to consult with your own professional representation to properly evaluate the information presented and its appropriate application to your particular situation.