On August 10, 2016, Aetna announced it will help thousands of employees improve their financial security by addressing a significant issue – the cost of higher education and student loans.h3>
The program to help employees repay student loans comes a year after Aetna raised its minimum base hourly wage for U.S. employees to $16 an hour, affecting about 5,700 employees. At that time, Aetna also created an enhanced medical benefits program that helped lower out-of-pocket health care expenses for thousands of employees.
Now, Aetna Chairman and CEO Mark Bertolini has announced a new program to help employees pay off their student loans. “By helping ease their financial burden, our employees can better focus on our mission of building a healthier world,” he told USA Today.
“Last year we renewed our social compact with employees by raising the minimum base wage and lowering out-of-pocket medical costs for those eligible. It was the right thing to do, and our members directly benefit from reduced turnover and increased employee engagement,” Bertolini said. “Now we are tackling student loan debt, a roadblock to financial stability for far too many recent graduates.”
Financial well-being is a critical part of Aetna employees’ well-being, and will remain a focus moving forward, Bertolini said.
See a fact sheet about Aetna’s new student loan program for employees.
Helping recent graduates repay student loans
Beginning in January 2017, Aetna will match employees’ student loan payments up to $2,000 annually with a lifetime maximum of up to $10,000 for qualifying loans.
The program is not just for 20-something employees who are new to the workforce. It’s available to employees of any age who have earned undergraduate or graduate degrees from accredited institutions within three years of applying for the matching loan program.
Aetna takes a holistic view of employee well-being – one that includes physical, mental, social, and financial health.
Aetna estimates about 4,000 employees have received degrees in the last three years and could be eligible for matching loan payments.
The new student loan repayment program builds on Aetna’s existing programs to provide financial support for employee education, including the Employee Tuition Assistance program. All employees (full-time and part-time working 20 or more hours per week) can be reimbursed for 80 percent of approved expenses associated with obtaining a college degree or job-related college courses, up to $5,000 for full-time and $2,500 for part-time employees. Aetna also reimburses employees up to $2,500 for approved, job-related courses taken outside a degree program for for job- or career-related certificate or certification programs.
Student loan debt delays car and home purchases, marriage
Whether employees went straight from high school to college and now are in the first job of their career, or are mid-career professionals paying off a graduate degree meant to enhance their careers, loans can be crippling.
Nearly 70 percent of college graduates from the class of 2016 borrowed for their education, and they have an average of $37,172 of student debt. How has this debt affected their lives? According to the EdAssist Student Loan Debt survey:
- It prevents them from making important purchases; 50 percent said they’ve been held back from buying a home and 56 percent from buying a car.
- It’s damaged personal relationships; 77 percent said a personal relationship has been impacted and 49 percent said they would delay engagement or marriage because of their debt.
- They are giving up on education; 64 percent said debt keeps them from pursuing a new degree.
“We’re investing in our employees’ well-being by helping make college more affordable,” said Kay Mooney, Aetna’s vice president for Employee Benefits. “Whether they’ve already earned their degree or plan to pursue one in the future, this program can ease the financial burden so they can focus on creating more healthy days for themselves and our members.”