How MEC Plans Support Retention in High-Churn Industries (With Metrics That Matter)
Staffing agencies, restaurants, retail chains, home care agencies—among many other businesses—power our economy. But they also face a stubborn, expensive problem: turnover.
Turnover in food services hovers around 80%. In the home care sector, annual turnover has reached 79%. For staffing firms placing hourly workers, churn is over 300%.
While no benefits strategy can eliminate turnover completely, offering health coverage—especially an affordable, accessible option like a Minimum Essential Coverage (MEC) plan—can make a measurable difference in retention and engagement.
Why Retention Matters for Your Bottom Line
Employee turnover is more than a headache—it’s a hidden tax on your business.
The cost to replace a frontline employee can vary, but many often neglect to add up all of the factors. This can include recruiting and onboarding costs, productivity losses, training costs, institutional knowledge/IP losses, and losses of employee engagement/morale.
In high-volume industries, those costs multiply quickly, eating into margins and growth capacity.
And while many factors drive turnover—like scheduling, pay rates, and management—benefits are consistently ranked among the most impactful retention levers that companies have.
What the Data Says About Benefits and Retention
Here are some eye-opening statistics:
According to LIMRA, 40% of employees were considerably more likely to stay with their employer because of their current benefits package.
2023 research from Gusto found that: “Employees with health insurance are 25% less likely to quit during their first year of employment, on average. For employees in the professional services sector, this number increases to 30%.”
According to KFF, cost is the most common reason that uninsured adults don’t have insurance.
These numbers highlight a simple truth: Offering coverage—even limited coverage—sends a message that you value your team.
How MEC Plans Help Improve Retention
MEC plans provide the foundation of ACA-compliant health benefits while keeping costs predictable. For high-churn industries, that combination is critical.
Here’s why MEC plans work:
Accessibility:
MEC plans typically have low premiums, making it easier for hourly workers to enroll and stay covered.
Compliance:
They help you meet the ACA requirement to offer Minimum Essential Coverage to at least 95% of full-time employees—reducing penalties that drain resources from retention programs.
Peace of Mind:
While MEC plans don’t cover everything, they ensure employees can get preventive services at no cost, such as immunizations and screenings—services that build trust and goodwill.
A Differentiator:
In competitive labor markets, offering any health benefits helps set you apart from other employers who offer none.
Retention Metrics to Watch
If you implement a MEC plan, track these indicators over time to measure impact:
Enrollment Rate:
How many eligible employees sign up? Growth here often signals rising trust and engagement.
Average Tenure:
Compare pre- and post-MEC plan data to see if tenure increases, even by a few weeks or months.
Voluntary Turnover:
Watch for downward trends in employees quitting without another job lined up—often a sign of dissatisfaction.
Best Practices to Maximize Retention Impact
Here’s how to get the most value out of MEC plans:
Communicate clearly.
Explain exactly what’s covered and what isn’t, in plain language. Confusion and jargon only adds barriers.
Make enrollment simple.
Use online enrollment tools and offer support in multiple languages.
Highlight preventive care.
Emphasize that employees can access key services at no cost.
Pair MEC with other perks.
Consider adding low-cost supplemental benefits, like telemedicine or dental discounts, to strengthen your offering.
Keep Your Workforce—and Your Business—Stronger
Turnover isn’t going away. But smart benefits strategies can help you stand out, stay compliant, and retain more of the people who keep your business running.
If you’re ready to explore how MEC plans can support your workforce retention goals, we’re here to help.
Let’s connect. Contact us for a no-obligation consultation today.