Yes—with an employee-paid arrangement
A business can make voluntary supplemental coverage available while employees who choose to enroll pay the premiums. That is the basis for Aflac’s “no direct cost” employer message. It describes who pays the insurance premium, not a promise that setting up and maintaining the arrangement requires no time or administration.
The first conversation should establish what your team needs, what employees would pay, and what the business would need to coordinate.
Separate the premium from the work
Ask for a clear description of eligibility, participation requirements, enrollment, payroll deductions, billing, and ongoing changes. Confirm whether any fees apply and who handles questions when an employee joins or leaves.
For example, imagine a small business with a limited benefits budget. Making an employee-paid option available could give staff another choice. The owner would still want to know how deductions are reconciled and how much work payroll will require. This is an illustrative decision, not a promise of a particular arrangement.
Participation should remain a real choice. Employees need understandable materials and time to consider the premiums against their household budget.
Explain what the coverage does
Supplemental policies address defined events, such as a covered accident, hospital stay, or listed critical illness. Many pay cash benefits directly to the insured, unless assigned otherwise. They do not replace comprehensive medical coverage or promise to pay every expense.
Before selecting an option, ask which concern it is intended to address and how it fits with existing benefits. More choices are useful only when employees can comprehend the differences.
Confirm responsibilities before enrollment
Employee-paid does not by itself establish a particular tax treatment or exemption from benefit-plan requirements. Aflac’s ERISA advisory explains that the employer’s role can affect the treatment of a voluntary arrangement. Discuss the proposed setup with qualified benefits, payroll, and tax professionals as appropriate.
Bring these questions to the conversation:
- What would an employee pay each pay period?
- What does the employer need to do before and after enrollment?
- Which terms must be confirmed for our state and workforce?
If the arrangement does not fit the business or employees, declining it is a reasonable outcome. Our employee benefits overview can help you prepare questions before requesting a proposal.
Sources and coverage notes
Reviewed October 29, 2026: Aflac, Employee benefits for employers; Voluntary benefits 101; Voluntary plans and ERISA.
General education only. Supplemental health coverage is not major medical insurance. Availability and benefits vary by state and product; policy definitions, limits, exclusions, waiting periods, and eligibility rules apply. This article provides no legal or tax advice.