How to Make the Most of Benefits Enrollment Seaso

Originally posted on Ignites.com, this article take on the important topic of Open Enrollment, and the fact that far too few employers and employees treat it with importance.

While benefits have long been a vital part of companies’ recruitment and retention strategies, the dicey economy, ongoing debate around national health care reform and rising health care costs have workers scrutinizing their packages more today than perhaps ever before.
“I do think that there has been an increase in questions and interest in what’s happening, because people have [issues related to health care and insurance that are] more top-of-mind now,” says Charles Kibort, director of human resources at Janus.
That makes open enrollment season, typically an autumnal tradition, an important time for firms to communicate with staff about their benefits. For those firms that do it well, the sessions are an opportunity to improve employee engagement, research shows.

In fact, the Mercer Workplace Survey published last month found that nearly 80% of 1,507 workers agreed that benefits are one of the reasons they work at their firms. And heath care is one of the benefits employees value most. Of those surveyed, 46% said the amount they paid in out-of-pocket health care costs was “definitely worth it,” compared to 38% of those surveyed in 2010 and 28% in 2008.

Respondents included American workers across industries who participate in their employers’ health and 401(k) plans.
That increased satisfaction comes despite rising costs. Average annual premiums for single employees rose 8% between 2010 and 2011. The hike in rates for family coverage was 9%, compared to only 3% for that cohort between 2009 and 2010, according to data from the Kaiser Family Foundation. But, in general, employers have picked up most of that cost.

The average share of premiums paid by workers each month in 2011 was $77 for individuals and $344 for families. That compares to $75 and $333, respectively, in 2010, according to the Kaiser Family Foundation.

As a percentage, employees’ share of their total health care costs is at an all-time low, says Paul Fronstin, director of the Health Research and Education Program at the Employee Benefit Research Institute. But employees still feel the pinch, he says. “Their wages are stagnant and their income is not increasing,” he says.

Companies may be able to counter that through clear communication about benefits. In fact, a survey out this month of 1,712 U.S. adults from employee benefits provider Unum shows that increased communication leading up to and during open enrollment periods generally improves employees’ perception of their employer’s benefits package, even if the package is not packed with bells and whistles.
Among those who considered their benefits education process excellent or very good, 85% rated their benefits package the same. In turn, 80% of those who gave their benefits plans high marks considered their company to be a very good or excellent place to work.

At Invesco, e-mails and in-person information sessions start more than three weeks before employees make their new elections, says David Romero, head of benefits at the firm. “We start with e-mails informing employees of the plan design changes and rates for the new year, which we believe is of the utmost importance to them,” he says.

For those who cannot attend in-person meetings, Invesco also offers webinars and directs employees to an intranet site with information about the annual enrollment process. The company also encourages employees to reach out to benefits counselors to review their options and make the most prudent choice. “We have found our communication strategy to be effective in promoting what is an ‘active enrollment’ whereby some employee elections do not roll over from year-to-year. So employees must take action to keep certain benefits in place for the following year… and our employees take action!” he writes in an e-mail response to questions.

Like Janus, Invesco has provided numerous updates about the 2010 Healthcare Reform Act and its implications for coverage.

Janus also uses its intranet at least three weeks prior to the open enrollment period to remind employees to examine, and perhaps tweak, their elections. Two weeks before enrollment starts, the firm offers a guide that lays out the process. Employees also receive paper guides, mailed to their homes, which provide spouses with an opportunity to review materials too, says Kibort. A series of in-person meetings begins a week prior to enrollment and lasts throughout the two-week period, he says.

At Vanguard, in addition to posting materials online two weeks prior to the open enrollment start, the firm offers resources such as medical plan cost calculators and an online “virtual fair,” as well as newsletters, articles, webinars and audiocasts, according to spokesman Joshua Grandy.

When it comes to assessing benefits, employees’ three favorite resources were online calculators (79%), an envelope packed with print materials (72%), and meetings and seminars hosted by human resources staff (66%), according to a MetLife survey of 1,204 employees conducted in 2008.

Aside from health benefits, Janus uses open enrollment materials about other perks the firm offers, such as adoption assistance and tuition reimbursement programs. Open enrollment also offers the firm an opportunity to talk about the steps the human resources team has taken to ensure employees get an attractive package. The discussion compares costs and coverage to other financial services and local companies, and reviews the costs with an eye toward keeping the employee’s portion low.

“We want our employees to be healthy. We provide great benefits and we want employees to take advantage of the benefits we offer,” Kibort says.

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About thebenefitblog

Eric is a Producer at Lockton Insurance Brokers, Inc., the world’s largest privately held commercial broker. Eric has over 23 years of experience in the insurance industry and has spent the last 11 years with Lockton. Eric specializes in Health & Welfare Benefits, Retirement Planning, and Executive Benefits. Eric's clients utilize his expertise in the areas of Plan Due Diligence, Transaction Structure, Fiduciary Oversight, Investment Design, Compliance and Vendor negotiation to improve the operational & financial outcome for each client. The Benefit Blog is a place to share that expertise and industry news.
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