Hospital Indemnity Insurance: Solving employer challenges while supporting employees

Today’s employers are navigating rising healthcare costs, workforce disruption, and increasing benefits complexity — while employees may face greater financial exposure when a hospital stay occurs. Hospital Indemnity Insurance sits at the intersection of these challenges, helping employers manage risk and stability while providing employees with financial support when it matters most such as after a covered hospitalization or other covered loss. It’s important to note that Hospital Indemnity Insurance is not health insurance and does not satisfy the requirement of minimum essential coverage under the Affordable Care Act.

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Employer challenges and how they impact employees

Rising hospitalization costs

As the cost of care continues to rise, employers may be making cost-cutting changes to their benefit plans, including increasing deductibles.¹ While this helps control employer costs, it shifts more financial responsibility to employees. When an unexpected, or even planned, hospital stay occurs, employees may be left with significant out of pocket expenses.

How the coverage helps: Fixed-amount benefits paid directly to employees for a covered hospital stay can help minimize the financial impact of out-of-pocket deductibles and other expenses, reducing financial impact and helping keep the focus on such things as recovering and returning to work.

Administrative burden and benefits complexity

Employers may face ongoing challenges coordinating supplemental benefits, managing claims processes and ensuring employees understand what coverage is available to them. Complex or fragmented benefit experiences can result in underutilization — employees may have coverage but fail to use it simply because they don’t understand how it works. This diminishes the perceived value of employer sponsored benefits investments.²

How the coverage helps: Plans designed for simplified administration, clear plan structure and proactive claims support can help employers streamline benefits management while offering ways to make it easier for employees to access and use their benefits.

Low employee awareness and understanding

Despite offering a range of benefits, employers may struggle with low employee awareness — only 57% of workers report understanding their insurance benefits very or extremely well.³ When employees don’t understand their coverage, they are less likely to value it, use it effectively or even enroll in it.

How the coverage helps: Straightforward provisions, such as admission and daily confinement benefits, are easy to explain and easy for employees to understand and recognize as meaningful. This can help with improving engagement and perceived employer support.

Unpredictable health event spikes

Seasonal surges like influenza, Respiratory syncytial virus (RSV) and COVID 19 variants can lead to increases in hospitalizations, impacting claims volume and workforce availability. For employers, these unpredictable spikes can strain operations and disrupt productivity, while employees may face unexpected medical and other expenses.⁴

How the coverage helps: Benefits for covered hospital stays can help employees manage out-of-pocket expenses during health disruptions, allowing focus to be on what’s important, such as supporting recovery and workforce stability during periods of increased health related absence.

Why Hospital Indemnity Insurance is a shared solution

Hospital Indemnity Insurance connects employer priorities — cost management, workforce stability, and administrative efficiency — with employee needs for financial protection and simplicity. By delivering benefits for covered hospital stays or other covered losses, this coverage can help strengthen an employer’s benefits strategy while giving employees tangible support during some of their most stressful moments.

How Hospital Indemnity Insurance offered by Voya Employee Benefits can help

Our Hospital Indemnity Insurance provides employers with a practical way to address modern benefits challenges while supporting employees during unexpected or expected health events. Flexible plan design, simplified claims support and guaranteed issue coverage help reduce employer complexity while delivering meaningful financial protection when it’s needed most.

Key features include:

• Fixed daily benefits for covered hospital,* ICU, rehabilitation, and observation unit stays
• Admission benefit and daily confinement benefits** with flexible plan levels
• Guaranteed issue coverage with no medical questions
• Annual Wellness benefit for eligible health screenings***
• Included features such as newborn coverage and daily benefits for inpatient mental health and substance use confinement

Contact your Voya Sales Representative for more information. 

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