Today, starting and growing a family is more complicated (and expensive) than it's ever been.
Nearly every organization would agree healthcare is a crucial benefit. More and more are adding childcare and family-oriented perks to their benefits packages.
But very few tackle the unique needs of their diverse workforce and support them on their family building journey.
For that, you need to offer a comprehensive family building benefits package.
A quick definition of family building benefits
Family building benefits refer to the range of services and support employers provide to their employees to assist them in starting and growing their families.
They typically include:
- Financial assistance
- Medical coverage
- Paid leave
- Resources for adoption or surrogacy
- Counseling and support for fertility treatments
- Flexible work arrangements to accommodate family planning
The goal of a managed family buiding benefit is to support employees throughout their entire journey of building a family — from conception to postpartum and beyond. It's a more inclusive version of traditional maternity and paternity benefits that recognizes family building looks different for everyone.
What makes family building benefits important?
The International Foundation of Employee Benefit Plans has tracked fertility and family-forming benefits over the last 7 years. According to the results of its 2022 Employee Benefits Survey, 40% of organizations are now offering them — an increase from 30% just two years prior.
What's driving the huge uptrend? A few things:
- Employees care more than ever about work-life balance and mental health.
- More people are waiting to start families until later in life, when fertility challenges can arise.
- The cost of adoption and surrogacy services is high (and often not covered by standard employer-sponsored health plans).
- There's an increased awareness of the LGBTQ+ community's unique family planning needs.
Considering these benefits directly relate to a few specific groups of employees either accessing or being excluded from family planning options, it's among the most essential components of an inclusive benefits package.
The financial landscape of building a family
Particularly for those who aren't able to conceive naturally, the road to building a family can be remarkably expensive. And most traditional health insurance is limited in which fertility treatments, adoption, or surrogacy services they cover (if they even cover them at all).
The average per-cycle cost of in-vitro fertilization (IVF) falls between $14,000 and $20,000, 80% of those who undergo treatment have no coverage whatsoever, and ~70% go into debt.
Surrogacy costs ~$100,000 on average, with medical and legal fees, life insurance coverage for the carrier, and paying for their time all factored in. Adoption through an agency or independent attorney will generally run you somewhere between $20,000 and $45,000.
And because of discrimination against non-heteronormative people in the adoption process, LGBTQ+ couples have tremendous difficulty getting secondary parentage and legal rights over their children. Added costs and legal complexity are both incredibly expensive and taxing on the parents' mental health.
Even for your team members who are able to conceive naturally, the average cost is $18,865. So, no matter the path they take, your employees will 100% need financial support in building their families.
Supporting diverse family building needs doesn't have to be costly, either.
While the narrative around topics like fertility treatment, adoption, and family planning services for same-sex couples is rapidly changing, plenty of employers claim they cannot justify the added costs of these perks in addition to standard health benefits.
Good news: RESOLVE and Mercer studied this and found that virtually all (97%) of employers that added fertility benefits to their packages have NOT seen a significant increase in costs.
Even better: The study also found that employers who are offered family building options saw higher employee satisfaction — 64% went as far to say it took care of all their employees' requests.
Components of a family building benefits package
Every company's family benefits are a little different. Certain things may pertain to your company's workforce, specifically, depending on your employees' priorities. There are, however, a few standard benefits that all employers should consider offering:
Fertility treatments
Fertility benefits are a core aspect of any family building plan. It includes coverage for various procedures involved in helping conceive a child, such as:
- Intrauterine insemination (IUI)
- In-vitro fertilization (IVF)
- Donor egg and sperm
- Surrogacy expenses
- Fertility medication
- Genetic testing
There are 19 states that already mandate some form of fertility coverage, so this is a good place to start. Even if you're not located in one of them, offering fertility benefits will almost certainly help retain an employee who is considering adopting or using a surrogate.
Adoption assistance
Adoption assistance benefits are most likely going to include some mix of:
- Financial reimbursement for legal and agency fees
- Subsidies for travel expenses
- Paid time off for adoption-related appointments
- Parental leave for adoptive parents
- Access to counseling services
Most employees are unaware they can use pre-tax dollars for adoption expenses. Adoptive parents can claim up to $15,950 per adopted child as a tax credit for every child they adopt.
For employers, reimbursement for adoption expenses isn't subject to income tax. That said, it is subject to Social Security, Medicare, and FUTA tax, which is why it's best to offer it using 100% tax-compliant benefits software (like Compt).
Surrogacy support
Surrogacy support benefits range from paid time off to allowances or stipends to help cover medical and legal fees. Because surrogacy is cosmetically more invasive than adoption, these benefits can also include more personal care items like massages or lactation consultants, which are often needed during the postpartum process.
Insurance companies won't cover the cost of transferring an embryo into a surrogate mother. In fact, most policies explicitly state they will not pay for medical expenses related to gestational surrogacy.
Some private health plans offer female employees a benefit that allows them to freeze their eggs. But, when the surrogate becomes pregnant, a separate health insurance policy the intended parents purchase covers their prenatal care.
So, it's on employers to offer this managed fertility benefit.
Paid parental leave
The Family and Medical Leave Act (FMLA) requires federal and public employers and those with over 50 workers to offer parents 12 weeks of unpaid leave following a child's birth or adoption.
"Unpaid" is the keyword, here (though employers do need to maintain an employee's healthcare benefits during this time). There is no federal law that requires paid parental leave. Only around 1 in 4 private workers in the US have access to paid family leave.
Beyond the standard maternity and paternity leave, this can include more extended periods of paid leave or more flexible options for parents looking to bond with their new children, regardless of whether the child was biologically born or adopted.
Childcare support
We've talked extensively about childcare benefits. They're the best way to support working parents who are raising young children and are one of the most effective tools for achieving gender equitability in the workplace.
Childcare benefits can take many forms, including:
- Dependent Care Assistance Plans (DCAPs)
- Pre-tax contribution to dependent care expenses
- Backup childcare services
- On-site or near-site daycare facilities
- Childcare subsidies or reimbursements
Per the IRS, you can also get a tax credit of up to $150,000 for offering childcare assistance — 25% of qualified expenses for childcare facilities, in addition to 10% of the qualified expenses for childcare resources and referrals, paid or incurred in the tax year.
Lactation support
Thanks to the Affordable Care Act (ACA), most health plans are required to provide breastfeeding support, counseling, and equipment for new mothers in the same way they cover preventative care. And employers under the Fair Labor Standards Act (FLSA) are required to offer "reasonable" break time and a private space for new mothers to express milk.
However, the conditions under which employers provide this space and time aren't always ideal. For instance, if an employee's only option is to pump in a shared bathroom, that might not be considered "reasonable" under the law. If an employee is forced to use unpaid breaks to pump, that probably isn't "reasonable" either.
There are plenty of ways you can go beyond the requirements and provide compassionate, accommodating lactation support for new moms in your workplace:
- Offer comfortable, private spaces specifically designated for lactation (e.g., a clean, dedicated room with comfortable seating, a mini-fridge to store milk, and a sink for washing equipment).
- Provide breaks or flexible scheduling to accommodate pumping sessions.
- Offer access to lactation consultants or other support resource for new mothers.
- Provide breast pumps to new mothers or offer reimbursements for purchases.
Family health and wellness programs
In addition to access to family building services, parents also appreciate wellness benefits that help keep their families healthy and happy. These can include:
- Gym memberships
- Discounts on fitness classes or activities
- Telehealth services for non-emergency medical care
- Nutrition counseling
- Mental health resources
You might already offer this to all employees through a health and wellness stipend. For new, aspiring, or soon-to-be parents, encourage them to use these resources to support their growing families.
Family stipends: The EASIEST way to offer family building benefits
Offering family building benefits requires you to manage eligibility and enrollment, financially plan for benefits, and communicate them with employees. Not to mention, you'll have to somehow get them paid out.
Aside from improving your healthcare benefits by choosing vendors that include things like fertility services and resources for adoptive parents, a family stipend is far and away the easiest way to offer comprehensive benefits for family building.
- Select the "Family Stipend" category in your Compt dashboard.
- Set a fixed amount that all employees will receive if they qualify (e.g., new hires, full-time workers).
- Integrate with your payroll system.
- Communicate this benefit to your employees and make sure they know how to access it.
Compt makes coordinating family building employee benefits a whole lot easier (and cheaper). Request a demo to see how.