Health Insurance Daily

Firms Don't Track Short-Term Disability Costs

Many employers are unaware of their short-term disability benefit costs, and employees don’t realize the value of the benefit, according to a new survey from the International Society of Certified Employee Benefits Specialists.

Companies often handle disability through payroll, and 41% of employers don’t know what they spend on short-term disability benefits as a percentage of payroll.
“Given that studies have shown 30% of employees will become disabled for at least 90 days at least once during their working career, we find it surprising that most employers are unaware of how much they spend on their short-term disability benefits,” says Leanne Fosbre, vice president of ICEBS and manager of group insurance administration for Madison, New Jersey-based Wyeth Pharmaceuticals.

Fifty-three percent of firms that do know what they’re spending say they dedicate 0-5% of payroll to short-term disability benefits. A whopping 86% of companies offer a non-contributory disability benefit, while the remaining 14% that require employee contributions indicate that it hampers enrollment.

Employees ranked health benefits, 401(k)s, paid time off and pensions as more valuable to them than disability benefits.

Article provided by BenefitNews 3-1-07

posted by Mike @ 8:07 AM