Alongside tried-and-true voluntary benefits such as life insurance and disability, some mid-market employers are rolling out nontraditional products — often to ease the sting of higher employee cost-sharing for major-medical coverage as well as enhance their overall benefits packages.

In particular, critical illness, cancer, accident and hospital indemnity plans have gained popularity in recent years (see chart) as employers seek to fill gaps in medical coverage. By offering these voluntary plans, employers hope to reduce the pain of employees' rising contribution to health premiums, deductibles and copayments and protect workers against unexpected and potentially expensive claims.

Benefit experts also see some midsize employers adding noninsurance programs, such as discounts on consumer goods and services.

“A lot of these programs are not necessarily new per se, but they're increasing in importance,” said Chris Hill, founder and CEO of Spotlite, a Chicago-based company that electronically enrolls employees in voluntary benefits, and sister firm PerkSpot, a provider of corporate perks and benefit programs.

As employers shift costs to the employee, they're asking, “How can we help the employee stretch that payroll dollar?” Mr. Hill said.

Medical software provider Merge Healthcare Inc. started working with Spotlite in June 2012, about the same time the Chicago-based company eliminated one of its three health plan options.

Using Spotlite's voluntary benefits platform, Merge Healthcare's 750 U.S. employees can access PerkSpot corporate discounts on everything from restaurant meals to language-learning software. They also can use Spotlite to buy Allstate Corp. accident or critical illness insurance, Mr. Hill said.

“This is something that we could offer to them and give them a little bit more in the times that we're taking a little back,” said Jim Nowaczok, a compensation and benefits specialist at Merge Healthcare.

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Middle-market employers' voluntary benefits have been limited to some extent by their size and choice of insurers, said Rob Shestack, senior vice president and national practice leader of Charlotte, N.C.-based AmWINS Group Benefits, a unit of AmWINS Group Inc.

Some insurers require minimum participation to underwrite a group and may not do business with groups of fewer than 500 or 1,000 lives, he said.

“That's one of the reasons we want to be in that space — because it's underserved,” said Mr. Shestack, who leads the company's newly launched voluntary benefits practice and serves as chairman of the Palm Beach Gardens, Fla.-based Voluntary Benefits Association.

Voluntary benefit sales to employers of all sizes reached $6.03 billion in 2012, up from $4 billion a decade earlier, according to Eastbridge Consulting Group Inc.

With new insurers entering the voluntary benefits space, some existing insurers are relaxing their underwriting requirements, Mr. Shestack said. They're offering guaranteed-issue products for groups starting at 100 lives. Some are even waiving participation requirements for the first year or two “to get their foot in the door and start building up a good number of policies to help offset their risks,” he said.

Some voluntary benefits growth comes from midsize employers looking to restore a core benefit, such as dental insurance, that was eliminated, experts say. Making the benefit voluntary preserves access to the coverage at no cost to the employer.

On average, one in five employers of all sizes said they were thinking about switching an offering from employer-paid to employee-paid, according to a 2012 Eastbridge Consulting study.

Some employers are beefing up their benefits with products that serve the health and financial welfare of their employees, from legal and long-term care coverage to automobile and homeowner policies.

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Rich Reda, executive vice president at Lockton Cos. L.L.C. in Kansas City, Mo., said employees like the convenience, group discount and feeling that employers have adequately vetted the insurers.

Identity theft coverage is popular with mid-market employers as a value-added benefit, said Tom Nicol, managing partner at Excelsior, Minn.-based Excelsior Benefits L.L.C., an intermediary representing LifeLock Inc.

Education Navigation Inc. deals with another work/life challenge: helping parents of kids with autism, attention-deficit disorder, learning and emotional or behavioral issues navigate the special education arena.

“It's typically between 8% and 14% of an employer's population that are dealing with these issues,” said President and CEO Debra Schafer, whose Malvern, Pa.-based company sells voluntary and employer-paid benefits to national clients, including midsize employers.

Last year, Atlanta-based Purchasing Power (see related story), a voluntary program for workers to buy products and services through payroll deduction, added educational services including online college courses, tutoring and professional certifications, said Elizabeth Halkos, the company's chief revenue officer. Vacation packages may be the next addition, she hinted.

Some employers are looking at Purchasing Power “to kind of offset what they're anticipating to be the negative effects of health care reform,” Ms. Halkos said.

In a recently commissioned study on the mid-market, Lake Forest, Ill.-based Trustmark Voluntary Benefit Solutions, a Trustmark Insurance Co. division, found that the biggest underserved need is wellness. Midsize employers don't have the resources to run the kinds of wellness programs found in larger companies, said Dan Johnson, vice president of sales and marketing in the company's voluntary benefit division.

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Through its HealthFitness unit, Trustmark is piloting a wellness program for mid-market employers, a reduced-rate program available to companies that offer Trustmark's voluntary benefits, Mr. Johnson said. Trustmark uses the enrollment process to explain to employees the benefits of the wellness program, which includes health risk assessments and biometric screening.

While most voluntary benefits are paid entirely by the employee, some mid-market employers are subsidizing the cost, experts say.

“We're seeing employers use this as kind of a cost-containment tool for their renewals on their health insurance plan, where they can migrate to a higher deductible yet help provide access or some contribution to a plan that will fill the gap in the event that the employee has to use that coverage,” said John Stanley, senior vice president and chief marketing officer in Philadelphia for Little Rock, Ark.-based Transamerica Employee Benefits, a unit of Transamerica Life Insurance Co.