Recruiting is an investment of both time and financial resources. Multiply it across multiple departures annually, and turnover quickly becomes your most expensive drain. The answer isn’t always just to throw more money at talent. For better employee retention, health insurance and retirement benefits could be your solution. Try these proven 401(k) and healthcare benefits employee retention strategies and turn your practice into a workplace where great employees can build long-term careers.
The True Cost of Employee Turnover in Healthcare
Imagine your best dental hygienist decides to leave your practice. It’s just one person, but finding a replacement can cost up to twice their salary. These costs include things like:
- Recruiting and advertising the role
- Spending time interviewing candidates
- Running background checks
- Training time and licensing expenses
- Losing team productivity
- Overtime for employees who pick up extra shifts
And then there’s the unquantifiable knowledge loss. This was your best hygienist, after all – even the best new hire isn’t going to fill those shoes perfectly. Plus, the rest of the team might feel like they’re on shaky ground and struggle to keep up with their increased workload. Hello, burnout and higher turnover.
Ultimately, it might cost you less to prioritize retention through benefits.
Why Benefits Drive Retention More Than Salary Alone
Not too many people would work without a paycheck, but most employees consider salary just one part of a healthy compensation package. When it comes down to competing offers, the one with better benefits tends to be the winner. Healthcare benefits employee retention research consistently shows that benefits influence long-term commitment more than modest base pay bumps.
That’s because health insurance and 401(k) benefits are long-term financial incentives. Employees who get health insurance coverage can stay healthier, take care of their families, and avoid coverage gaps. Unvested 401(k) employer contributions create financial incentives to stay with you until vesting milestones are reached. Get that competitive advantage with total compensation retention strategies that we know work for health and dental practices like yours.
Retention Strategy #1: Position Health Insurance as a Core Value Proposition
You ever notice that employees tend to take insurance for granted? That’s because it’s now a standard part of compensation. It’s true, 89% of full-time U.S. employees have access to health insurance through their employer, according to the Bureau of Labor Statistics. If you’re looking at insurance as an optional perk, it’s costing you retention leverage.
Improve your benefits communication to make the value of your health insurance more visible:
- Show the actual dollar amount you invest into each employee’s coverage.
- Compare your coverage costs versus individual marketplace premiums. (For many Americans, this is the only alternative to non-employer sponsored health insurance.)
- Highlight your plan’s features, provider networks, family coverage, and other benefits.
- Hold benefits education sessions, not just open enrollment checklists.
Retention Strategy #2: Maximize 401(k) Retention Power Through Smart Design
When done well, 401(k) retention strategies leverage vesting schedules as intentional retention mechanisms. Retirement isn’t cheap, so if you’re helping employees build wealth, you’re showing them that you’re committed to them long-term. At the same time, having a multi-year vesting schedule encourages employees to stay with you instead of job-hopping. Integrated retirement and payroll administration keeps contributions flowing automatically while you try these 401(k) retention strategies on for size:
- Keep your employer match contributions visible to employees
- Communicate the vesting schedule to build financial incentive
- Offer immediate 401(k) eligibility to show commitment to new team members
- Try automatic enrollment with an opt-out option to boost participation
- Hold annual financial wellness education sessions to highlight the value of retirement benefits
Retention Strategy #3: Total Compensation Transparency and Education
So you’ve got paychecks, health insurance, and a 401(k) for your employees. Pretty sweet, but we’d bet you have even more great things to offer. Keep those things top of mind and the benefits crystal clear. Create a total compensation statement including:
- Base salary
- Employer health insurance contributions
- 401(k) match
- PTO value
- Continuing education allowances
- Other workplace perks
Now as your employees see their total compensation, they’ll gain a new appreciation for their overall package. Review these benefits often, not just during open enrollment. It can even be part of the conversation during performance reviews and compensation discussions because it shows exactly how raises, bonuses, and benefits reflect your commitment to employee success.
Retention Strategy #4: Address Life Stage Needs With Flexible Benefits
Think about the mix of employees in your practice and listen to their needs. Flexibility is going to be a big help in your benefits retention tactics.
Early-career workers aren’t thinking about retirement yet, but they might need a little extra scratch for student loans. They may prefer lower-premium health plan options than older employees.
Mid-career employees may have families, so they’ll need comprehensive family health insurance coverage, generous 401(k) matches, and maybe even college savings programs.
Late-career employees are quickly approaching retirement, so they’ll want to catch up on 410(k) contributions and make sure they have good health insurance.
How you structure your benefits package will depend on what your employees really need.
HR for Health Connects the Total (Benefits) Package
Offering only the essentials isn’t going to get you far in a competitive job market. You’ll need to be intentional, strategic, and transparent about what you offer your employees. Reinforce the value of your total compensation package so employees truly see what they’re getting.
You’ll know your employee benefits strategy is working when you see an increase in retention at the one-year, 401(k) vesting milestone, and long-term marks compared to the last couple years. Plus you can now manage your benefits from your HR for Health account, so you can stop creating extra work for you or your team. You’ve got the leverage for better retention. We can help you use it. Contact our HR experts to find out how.
