Company benefits are very important to employees. According to Aflac's Benefits Open Enrollment Guide for Employers, 80 percent of employees say their benefits package impacts their on-the-job engagement, and nearly 60 percent say they'll leave a job with better pay for one with better benefits.
Yet 46 percent of employees spend less than 30 minutes choosing a health insurance plan for the year. Given that many people spend 16 minutes a day choosing an outfit, there's a clear disconnect between the importance people place on workplace benefits and their engagement with them.
But it's hard to blame them. Choosing an insurance plan can be a nightmare, and quite frankly, many people just don't want to do it. The vast majority of people re-enroll in the plans they chose the year before. And a startling 73 percent admit that they don't even understand how their plans change from year to year.
Of course, employees bear some responsibility for this situation, but employers can help matters by changing the way they present benefits information.
Common Areas of Confusion
Before you can make this process easier, you must understand which items are tripping employees up in the first place. Rather than make your employees search for the answers, you should be prepared to address these three things:
1. Options: There's such a thing as too many choices. Decision fatigue can make choosing a healthcare plan arduous. It can help to create more tailored benefits packages for the different types of employees you have--in other words, help employees see which type of medical plan is best suited for each type of person. Consult with your broker before giving that sort of advice to ensure you're recommending the right choices and clearly communicating what each plan does and doesn't cover.
2. Wellness incentives: Wellness incentives include monetary rewards for healthy behavior and discounts for gym memberships or pedometer purchases. Many employees want to know whether you're committed to promoting them. Remember: How you discuss these kinds of nontraditional benefits will affect an employee's willingness to embrace them.
3. Spousal coverage: Denying coverage to spouses who are eligible for their own work plans is on the rise. In 2014, only 12 percent of employers excluded spouses who were covered elsewhere, but by 2017, an estimated 63 percent of employers will exclude spouses from coverage or implement surcharges if they can be covered by their own employers' plans.
Bringing Clarity to Benefits
There are two main trends in employee benefits communication that are helping eliminate confusion, and one has even been written into law. The Affordable Care Act mandates that health insurers and group health plans provide clear, comparable information about what's covered (and not covered), as well as an easy-to-understand glossary of terms.
These tools function like nutrition labels, giving standardized, meaningful information to help shoppers compare products and decide which plan fits their needs. Employers need to adopt the same strategy with their other benefits. A summary of what's included (e.g., sick days, vacation days, 401(k), etc.) and a glossary of terms should be on hand.
A second method is to use technology to educate employees. Auto insurers like Progressive have adopted this approach--as have investment companies like E*TRADE and personal finance companies like TurboTax. The health insurance industry, however, has been slow to adapt.
An online portal featuring comprehensive, digestible information gives employees an opportunity to educate themselves on their own time. It doesn't have to replace a thorough meeting, but it can catch anyone who couldn't attend the meeting or left it with unanswered questions.
An online portal has the side benefit of removing the scads of easily misplaced folders, forms, and information sheets that have haunted the benefits business. A centralized, paperless portal--preferably one with tailored decision support and help options--will cut through the clutter and simplify the decision-making process.
Your employees know their benefits are important, but they're not experts. The once-a-year decision at Open Enrollment can be dauntingly complex and provoke decision fatigue. So make it easy. Provide clear descriptions of what's offered, a glossary of terms, and answers to frequently asked questions, and make it all available in a central spot online.