by Carolyn Kick | Apr 7, 2020 | COVID-19 Resources, Employee Benefits
There’s never been a moment in recent history where access to healthcare and other employee benefits was quite so important. As we enter the predicted “surge week” here in the United States, HR and business leaders across the country are scrambling to determine how COVID-19 and the laws that have gone into effect this month will affect their employee benefits program.
The challenge is: everyone’s program and carrier are different, so there’s no one right answer to the question of “What does this mean for benefits?”
That means you’re likely going to have to work internally and with your benefits broker to figure out exactly how COVID-19, the FFCRA, CARES Act, etc. will impact your benefits program. With that said, however, we can provide you with some general guidance to ensure you’re asking the right questions, viewing your benefits through the right lenses, and doing everything you can to support your employees and continue your business in a compliant way.
In this post we’ll explore:
- Extension of benefits to cover COVID-19 care
- How your FSA grace period can spread out coronavirus-related expenses
- How special enrollment periods can help you connect employees with coverage right now
- What the FFCRA & CARES Act say about employee benefits
- The value of providing access to telemedicine as part of your benefits strategy
Benefit Extension During the Coronavirus Outbreak
Anytime you terminate an employee who is disabled or hospitalized or has a dependent who fits those criteria, benefits are generally extended until one of the following occurs:
- The terminated employee returns to work
- The terminated employee finds new work or access to coverage
- The terminated employee’s dependent/spouse is discharged from the hospital
Of course, with all the layoffs and furloughs surrounding the coronavirus outbreak, those requirements carry a heftier responsibility than ever before.
That means there is no benefit to terminating workers who are already away from the office due to COVID-19, as you will continue to remain liable for their family medical expenses. It’s not an advisable strategy to reduce your employee benefits program costs by terminating people.
Thanks to the Employee Retention Credit provided by the CARES Act, retaining those employees on FMLA leave may actually be advantageous in the long run, as they will decrease your tax burden.
Keep in mind that if you’ve already laid off employees, you’ll have to extend coverage to COBRA-eligible workers for up to 18 months if they don’t find new jobs.
Understanding the FFCRA’s Paid Leave Grace Period
The Families First Coronavirus Response Act significantly expanded paid leave for small and medium-sized employers, but it also provided a grace period of non-enforcement, which lasts through April 18th.
In essence, that means that employers cannot be punished for non-payment of employee leave until mid-month as long as they are acting in good faith and not delaying payments for reasons other than logistical constraints.
However, that doesn’t mean employers can negligently ignore the mandate until April 18th. If you’re dragging feet or waiting for the enforcement period to begin before playing by the rules, you could be putting your business at risk. The Department of Labor will be applying Sections 16 and 17 of the FSLA judiciously to minimize non-compliance and abuse of employees requesting leave at this time.
Leveraging Special Enrollment Periods
A special enrollment period represents any time where employees or individuals may enroll in health insurance outside of the typical renewal window.
While a national ACA special enrollment window has been shot down from legislation several times since the COVID-19 outbreak, several states have announced special enrollment periods for uninsured individuals and families looking to protect themselves during this crucial time.
If there’s a special enrollment period occurring in your state, it’s vital that you communicate that information to employees that previously opted-out of a healthcare plan and encourage them to get the care they need.
Encouraging Employees to Use Your FSA Grace Period Effectively
Flexible spending accounts, healthcare reimbursement accounts, and other benefits that help employees fight out-of-pocket healthcare costs generally need to be used within a given calendar or plan year. However, employees usually have a few extra months to make sure they use those funds before they disappear. For example, if your plan year ended on December 31, that means your grace period likely extended through mid-March.
If your benefits program plan year ended in mid-January or later, your employees are likely still able to incur FSA or HRA expenses for plan year 2019. That’s good for you because it means that the funds your employees and their families need to fight COVID-19 and stay healthy might already be allocated to them from the prior year.
If your plan year ended in November or December, your grace period is likely over, but employees can still use FSA and HRA expenses to pay for the medications, treatments, doctor’s visits, and so on they need to survive this time. For those lucky enough to have plan years starting between January and June, employees will be able to “double-dip” this year, significantly increasing their ability to meet out-of-pocket medical costs.
The Value of Telemedicine
Telemedicine (access to doctors via video conference, phone call, etc.) has grown significantly over the last decade, and if it’s a part of your employee benefits program as you’re reading this, you’re already going a long way to support your employees during this challenging time.
Telemedicine is powerful because it gets employees a doctor’s appointment without the need to travel to the doctor’s office. During this time of social distancing, that technology has the power to provide care for patients without exposing them to the COVID-19 health risks that will be present in most of our U.S. hospitals for months to come.
If you’re offering telemedicine to employees, you need to be sure they’re aware of it and are clear on how to access it. Communicate via email blast with your team to help them understand what services are available through telemedicine and how they can access them.
If you’re not currently providing telemedicine opportunities through your employee benefit offerings, now would be a perfect opportunity to talk to your benefits broker about how to maximize access to care while minimizing the need to visit a doctor’s office.
Takeaways
As we said when we began, there’s no one answer to the question of “How is COVID-19 affecting my employee benefits program, and how can my employee benefits program help affect change in the fight against COVID-19?” You need to dive deep into your program offerings and speak with your benefits broker to understand what this really means for your business.
In the coming days and weeks, however, it will be important for everybody to think about:
- Benefits extension: What will the real cost be of laying employees off while also continuing to support their benefits? Can we maintain our team and leverage the tax credits of the CARES Act to keep us afloat this year?
- The paid leave grace period: How will we be sure we’re fully compliant with FFCRA leave requirements by April 18?
- Special enrollment periods: Is there one in your area? Can you help previously unenrolled employees protect themselves through special enrollment?
- FSA/HRA grace periods: Does your plan year allow for employees to use both 2019 and 2020 funds to fight coronavirus? If sure, make sure they know.
- Telemedicine: Are you currently offering it? Do your employees know? How can you start offering it if you aren’t already?
by Carolyn Kick | Mar 26, 2020 | COVID-19 Resources, Employee Benefits
The ongoing COVID-19 pandemic has put telemedicine in the
spotlight and directed new resources towards this crucial healthcare
innovation. Over the past few years, telemedicine has gained traction with
forward-thinking growing businesses and benefits brokers as a cost-saving way
for employees to get the medical advice they need – without having to miss work
to do it. However, many businesses and healthcare professionals have treated it
as a handy supplement at best and an unnecessary expense at worst.
But as the nation locks down under quarantine and a trip to
the doctor means potentially exposing yourself and others to the risk of
infection, telemedicine is coming to light as a critical point-of-care option.
Let’s take a look at why employers should leverage
telemedicine to keep their employees healthy and contribute to containment
efforts, explore plus the ins-and-outs of getting employees access to
telehealth during the outbreak, including:
- Why COVID-19 makes telemedicine more important
than ever
- How telemedicine is becoming more accessible due
to the outbreak
- How to get your team members the telehealth care
they need
Why Telemedicine
Is More Important Than Ever
There are almost limitless reasons to use telemedicine
during the COVID-19 outbreak. On an individual and societal level, at this
point in time our safety relies upon two things: limiting physical interactions
through social distancing and preventing the healthcare system from getting
overwhelmed. Telemedicine is a powerful tool to facilitate both of these goals.
Quarantine orders and the very real risk of exposure – or
exposing others – mean that seeing a healthcare professional in-person should
be the option of last resort for you and your employees. Your team members
should still get physical assistance if their health condition becomes serious,
but telemedicine can minimize the risk of the disease spreading to or from your
employees. And given the fear of exposure, telemedicine will likely increase
your employees’ access to healthcare in a very real way. People who would
otherwise avoid a doctor’s visit for fear of leaving the house will be able to
get the care they need.
Telemedicine is also quicker and easier for providers
compared to a regular office visit. And it puts a significantly lighter burden
on the healthcare system than an urgent-care or emergency-room visit. That
means that it can limit the amount of strain that employees put on an already
overburdened system, potentially saving lives.
While telemedicine can help employees safely get medical
advice for issues not related to COVID-19, it is especially important for
employees who suspect that they have the virus to use telemedicine as a first
resort. As long as the symptoms are mild, doctors are encouraging
home-treatment akin to mild flu. Unless the case is severe and requires urgent
attention and physical treatment, telemedicine can resolve employees’ fears and
get them the advice they need without causing COVID-19 carriers to go out into
the world and potentially spread the disease. And while it is impossible to
administer a COVID-19 test remotely, the current limited supply and application
of the tests mean that mild cases would not be tested even if employees went to
the hospital or doctor’s office.
Telemedicine Is
Becoming More Accessible
The medical community and government have recognized the
utility of telemedicine in combating the crisis of a rapidly spreading disease
and an overwhelmed healthcare system. The good news for individuals and businesses
alike is that they are increasing access to telemedicine as a result, generally
at reduced or zero cost.
For example, the CMS has expanded Medicare to cover
telemedicine and eliminated all requirements regarding the location of both
patient and provider. They have also loosened restrictions to allow
consultations over platforms such as Skype and FaceTime in addition to formal
platforms. Some states have also similarly expanded their Medicaid coverage.
While these expansions are unlikely to be directly applicable to your employees
if you offer health benefits, it is a strong sign of the general support for
telemedicine. And employers should inform their team members of the expansions
as they may well have parents or loved ones on Medicare or Medicaid.
States are also starting to mandate that private insurance
companies cover telemedicine for all members in the state. Thus far only
Massachusetts has implemented the measure but more states will likely join
Massachusetts as the situation continues to develop.
In the meantime, many if not most major private insurers are
temporarily expanding their telemedicine coverage to address the outbreak.
UnitedHealth and Aetna have both extended telehealth coverage to all members
and waived co-pays, while Humana has followed suit for urgent-care telemedicine
calls. CIGNA has also added the option to make a telemedicine appointment with
a CIGNA doctor through their website at no added cost, which increases care but
does not waive co-pays for standard telemedicine. As of today, Blue Cross Blue
Shield is one of the only major insurers to not expand telemedicine coverage in
light of the outbreak, though they have promised to “encourage the use of
virtual care and will also facilitate member access and use of nurse/provider
hotlines.”
How to Leverage
Telemedicine to Get Your Employees The Care They Need
By now, it should be clear that telemedicine isn’t just an
added employee benefit but a true necessity during the COVID-19 pandemic. But
as with so many issues related to the outbreak, the situation is constantly
changing in terms of access to care. So how can you ensure that your employees
can take advantage of telemedicine to keep themselves and their communities
safe and healthy?
The first thing you should do is to talk to your benefits broker
and your insurance provider to evaluate your current telemedicine coverage. You
should also ask about any changes that they may have made in light of the
current COVID-19 situation. And if your employees aren’t covered, lobby your
insurance company to expand their telemedicine coverage and consider shelling out
for additional telemedicine coverage, at least temporarily. Also consider the
fact that a prescription delivery option makes it easier for employees to
follow-up on their telemedicine visit to get the treatment they need without
added risk of exposure.
You might also consider making these changes permanent
additions to your employee benefits, if they aren’t already. Telemedicine is an
effective way to reduce healthcare expenses and health-related absenteeism even
when there isn’t an ongoing health crisis.
Final Thoughts
During this unprecedented health crisis, it can be hard to tell what you should do to protect yourself, your employees, and your business. Telemedicine is emerging as one method that is certain to improve the situation. Talk to your employee benefits broker today to see how you can leverage telemedicine to address the COVID-19 outbreak.
by Carolyn Kick | Feb 20, 2020 | Compliance, Employee Benefits
“Discrimination” is a word that no human resources
professional ever wants to hear. Unfortunately, many HR leaders are unaware
that discrimination can easily be lurking where we expect it least: in our
employee benefits programs.
Moving forward, we’ll explore:
- The difference between unfairness and discrimination
- How employee benefits can unknowingly be
discriminatory
- What HR needs to do identify and eliminate
discriminatory benefits practices
Discrimination vs. Unfairness
Discrimination is the unjust or prejudicial treatment of
different categories of people, particularly on grounds of race, age, or
gender.
Unfairness is a lack of equity; that is to say, a situation
in which not everybody is treated the same way.
Those concepts are closely tied – and they can certainly
occur at the same time – but they’re not exactly synonyms.
Fairness is an ideal, a target we should be able to hit the
vast majority of the time. As an HR department, nobody is ever going to
love every policy or initiative, but if your policies and the way you treat
people feels consistent, you’ll be fine. When fairness issues become systemic
and begin to affect work or culture, then you have a problem.
On the other hand, it’s never okay to be
discriminatory from a moral or legal/compliance standpoint.
How does this apply to employee benefits?
By nature, insurance isn’t always “fair.” For example, if a
30-year-old employee and a 68-year-old employee are on the same health plan,
making the same employee contribution, the 68-year-old will see much more value
due to their increased likelihood of medical need.
If you’re the 30-year-old in that scenario, that doesn’t
feel very fair, but it’s not discriminatory. That’s because, if that
30-year-old had the same medical needs as the 68-year-old, the plan would be
just as valuable to them. There’s no unfair barrier in place blocking access
due to age.
The EEOC dictates that programs are not discriminatory in
that exact scenario as long as they provide either equal
cost or equal benefit.
HR directors and benefits managers hear a lot from employees
about why their benefits offerings are imperfect, but it’s crucial to sort out
a fairness issue from actual discrimination.
How can employee benefits be discriminatory?
As their name implies, employee benefits are valuable perks
that positively impact people’s lives. When you start offering different
employees different levels of benefits, you encounter a real fairness issue,
but depending on the way you’re classifying employees when you make those
offers, you might be discriminating and not even knowing it.
The law states that in order to offer two employees
different benefits packages, you need to demonstrate those two individuals are
on different levels in terms of “bona fide employment-based classifications.”
Those bona fide classifications include:
- Full Time vs. Part Time status
- It’s okay to offer full-time employees benefits
that part-timers don’t receive
- Geographic location
- It’s okay (even necessary) to offer eligible
employees different benefits packages based on where they live
- This generally applies to businesses that
operate across multiple states
- Different dates of hire and lengths of service
- It’s okay if senior employees have been
“grandfathered in” with an old plan
So, the bottom line is, if you have two full-time employees
working in the same office who got hired on the same day, they should have
equitable access to the same employee benefits programs.
What about managers and executives?
The most common way businesses inadvertently commit benefit
discrimination is by the way they structure benefit offerings to so-called
Highly Compensated Employees (HCEs). An HCE is someone who:
- Makes more than $130,000 or
- Owns more than 5% of the business
If your business is self-insured, the ACA prevents
you from offering preferential benefits packages to HCEs. If your business is fully
insured, you can offer a higher tier of benefits (or lower premium costs)
to HCEs if your business does not offer a cafeteria plan. In the event you are
insured and have a cafeteria program in place, it’s unlikely you will be
able to offer different plans to your executives, but always double check with
your broker.
Regulations concerning benefits discrimination
If you would like to explore the compliance frameworks to
fully grapple with the problem, here are some places you can find
discrimination regulations specifically tied to employee benefits policies.
What does HR need to do?
There are three compelling core reasons to review your
employee benefits programs through the lens of checking for discrimination:
- Reducing discrimination is simple the right
thing to do
- An employee dispute over a discriminatory
program could become a long legal battle
- If regulators discover or catch wind of
discriminatory practices, your business will be fined
As an HR leader, you need to be proactive and be sure you:
- Lead an internal audit of your employee benefits
offerings to ensure packages are offered in a way that is nondiscriminatory
- Contact your benefits broker to ensure they are
aware of all relevant regulations and can describe to you how and why your
program is compliant
- Inform your legal and compliance teams as
quickly as possible if you detect any issues, shortcomings, or possible areas
of discrimination
- Take ownership over correcting all issues as
quickly as possible
When you work to eradicate hidden discrimination from your
policies and offerings, you’re strengthening your organization for the
long-term and doing your part to create a better work experience for all
professionals.
Takeaways
Employee benefits discrimination unfortunately occurs often
because the situations in which businesses can or can’t offer different
packages can confusing at times.
Just remember:
- Insurance isn’t necessarily “fair” (because
there’s no guarantee people will get the same value out of it), but it should
never be discriminatory
- All differences in benefits offerings should be
based on bona fide employment-based classifications, like part time vs. full
time, location, or date of hire
- If you are self-insured or have a cafeteria
plan, you cannot offer preferential benefit packages to highly compensated
employees
- All HR departments should lead an audit of their
offerings in collaboration with your benefits broker and legal team
by Stacey Gierut | Nov 8, 2019 | Employee Benefits
At Launchways, we pride ourselves on working closely with
each individual client to identify their workforce’s unique needs, navigate
their business model’s unique challenges, and leverage emerging best practices
to help them create employee benefit packages that truly support their workers
without breaking the bank.
As we near the end of 2019, we’ve been reflecting on the
most common client challenges we saw this year, and we’ve decided to share this
list of the Top 11 Employee Benefit Challenges Facing Today’s Businesses.
Here are the most pressing challenges we see assist our
clients with on their employee benefits programs:
Rising Healthcare Costs
Doctor visits, prescription drugs, and medical procedures
are more expensive than ever before, and it’s difficult to envision that
paradigm reversing in the near future. Media coverage surrounding healthcare
costs does a good job illustrating the impact on individual patients, but the
increased burden on businesses often goes unvoiced.
Every business wants to support their employees’ and their
families in times of personal and medical need, but the incredible costs
associated with certain long-term courses of treatment is causing some
businesses to feel nervous about the financial impact of offering comprehensive
coverage.
These tensions reinforce why it’s so important to partner with
the right employee benefits broker who you know is working in the best interest
of both your employees and your business to deliver maximum benefits value at
the lowest possible cost.
Understanding Employee Healthcare Needs
One of the biggest areas of loss in all of human resources
is the lack of alignment between employee healthcare needs and the benefits
packages offered. If benefits plans are too rich, it can cause undue waste of
business resources.
At the same time, however, shortfalls in coverage can be
financially and personally devastating to employees. That’s why tailoring your
benefit offerings to employee needs is crucial to hitting the sweet spot of
comprehensive coverage and well-scaled costs.
Analyzing employee healthcare usage data, available through
your carrier, can be extremely useful in this diagnostic work. Only when you
know what your employees truly need can you optimize your offerings.
ACA Compliance
The Affordable Care Act presents different challenges to
organizations depending on their scale, with specific regulations based on
employee headcount. Many growing or early-stage businesses break into different
tiers as they develop, and without proactive management, that can lead to
accidental non-compliance.
Knowing the ACA inside and out is a must for any employee
benefits specialist, and it’s also important to allocate co-planning time between
HR and finance to discuss how employee benefits programs will need to grow to
account for regulations as the business progresses.
If you don’t understand what the ACA demands of your
business, engage a compliance partner to help you navigate these complex
issues.
The Rising Relevance of Mental Health
Our shared cultural understanding of health and well-being
have shifted a great deal in recent years, and simply taking care of employees’
bodies is no longer enough. Mental wellness is just as important to success at
work and away from the office as our traditional understanding of physical
health and therefore must assume its proper place as a cornerstone of your
overall employee benefits strategy.
There are many businesses out there today who are failing to
provide their employees with an affordable and accessible framework to get the
therapy and medication they need, and businesses are often unaware this gap exists.
Across the industry, support for mental health must catch up to awareness.
Due to decades of stigma and denial, even talking about
mental health at work can be challenging at first, but in the 2020s, the
businesses with the strongest approach to mental health will be the ones with
the highest-performing teams.
Overreliance on Narrow Networks
A decade or so ago, benefits were trending toward narrow
networks, with the thought being that both patients and their employers could
save more money by staying relatively local and working with a tighter
healthcare team. In reality, narrow networks provide the most benefit to the
professionals who are doing the billing, not the paying, by ensuring a steady
patient flow.
Narrow networks can be a nightmare for new employees who
have existing relationships with out-of-network doctors or team members who get
life-changing diagnoses and want to pursue all options. They also prevent
patients from price shopping, which means you and your employees are stuck
paying whatever the in-network provider dictates, even if it’s not the best
deal.
Legacy narrow network healthcare is an underappreciated obstacle
to talent recruitment and retention, especially for organizations targeting a
younger or more diverse talent pool.
Offering a Qualified HDHP, but Not an HSA Strategy
High-Deductible Health Plans are always a great option for young
or single employees who do not require much coverage, and they also provide
tremendous savings for employers. With that said, however, an HDHP can easily
fail an employee who has sudden or unexpected medical needs that transform
their medical care into a mountain of debt.
If you offer HDHPs, it’s crucial that you protect your
employees by extending a Health Savings Account option. Using the HSA, you can
help your employees fill in the gaps in their HDHP coverage and limit their
out-of-pocket expenses, while still saving money compared to the price of a
lower-deductible plan.
As an employer, you must build benefits and incentives for
employees who have helped you out by selecting less expensive coverage options,
and the HSA is a best practice for returning that value back.
Educating the Workforce on Benefits
As we said earlier, one of the biggest areas of unnecessary
spend for many businesses is unused benefits. The root cause of that disuse is
often a lack of awareness, either because employees don’t know the benefits
exist or they don’t know understand how they would benefit from them.
Additionally, millions of workers who don’t know which
benefit package is right for them unwittingly set themselves and their
employers up for failure every year. As a proactive business leader, it’s your
job to give your team members the knowledge and tools they need to help
themselves (and you) when it comes to benefit elections.
Employee education is fundamental to any organization
getting benefits right at scale. Finding the right approach requires thinking
like a teacher and having a clear vision of what an optimized system will look
like.
Out-of-Date Dental and Vision Plans
People used to think dental and vision were “the easy part”
of employee benefits, but as technology has improved both fields, new
approaches have been innovated and care has gotten more expensive. For many
businesses with a legacy approach to benefits, their dental and vision plans
are simply out-of-step with the times.
Dental plans need to account for new approaches like implant
dentistry and cover a wider range of surgical procedures to make great
dentistry accessible to more people. Similarly, vision plans must account for
corrective laser procedures, innovative cataract removals, and so on.
Accessibility to dental and vision care greatly impact
employees’ and their families’ long-term health and well-being. If your
insurance offerings only cover procedures that were common in the ‘90s, you should
look at revising your plan.
Benefits Administration and Integration with Payroll & HRIS
As we all know, HR professionals balance an incredible
number of responsibilities, both human and administrative. One of the things
that makes those day-to-day tasks so frustrating is the lack of integration
between the tools they require to do their work.
For example, some HR professionals utilize an HRIS to
archive employee data, an HCM for people management, a benefits administration
system, and a payroll portal for financial transactions. Without backend
integration between these apps and tools, professionals have to do a great deal
of repeat data entry, leading to lost productivity and potentially costly
transposition errors.
In order to run an efficient HR department that can manage
benefits and other concerns in a daily, proactive manner, every organization
needs to move towards a single integrated system for employee benefits,
payroll, human capital management, and beyond.
Managing Short-Term Disability and FMLA
Disability and Family and Medical Leave provide a crucial
safety net for all workers. However, as an employer, you have a variety of
obligations and responsibilities when an employee applies for leave.
Too many organizations lack clear procedures for leave
application and approval, leaving themselves open to strained relationships
with employees and potentially costly lawsuits. The more proactive you can be
in laying out policy for giving employees the family or recovery time they need
while maintaining internal productivity, the better a support you can be for
your team members and your organization as a whole.
Each business should have a clear approach to the leave
application process, transparent approval criteria, and an established re-entry
plan for employees when their leave is over.
Finding Alternative Funding Strategies
As our first ten challenges have illustrated, providing
strong employee benefits is increasingly about flexibility and scale. The best
programs are the ones tailored to the specific needs of your employees with
maximum value and accessibility in mind.
With that said, it can be tough to achieve that bespoke feel
with a traditional fully-funded health insurance program. The total freedom of
self-funding might not be possible for all businesses, but there are a variety
of new and innovative ways you can connect with alternative funding to build
something more personalized.
If you’re intrigued about changing your funding model to
create a more open-ended, employee-centric approach to healthcare, talk to your
leadership team and benefits broker about exploring new possibilities.
by Carolyn Kick | Oct 11, 2019 | Employee Benefits, Open Enrollment
The open enrollment period between November 1 and December
15 can be one of the most challenging times of year for HR professionals.
Getting enrollment right in a timely manner is crucial to supporting your
workforce and maximizing the two-way value of employee benefits.
With that said, open enrollment is tricky because it is such
a complex challenge. There’s no one thing an HR leader or department can do to
make the enrollment season go smoothly – it requires proactive planning and
strategizing for a variety of factors and concerns.
Moving forward, we’ll explore:
- Introduce five of the biggest challenges,
concerns, and areas of opportunity for HR professionals before and during open
enrollment
- Provide actually strategies HR leaders can use
to navigate or plan for these challenges
Open Enrollment Challenge #1: Logistics
Part of having a successful open enrollment period is having
a very clear vision ahead of time for what that enrollment is going to look
like and how you will ensure success. Without a logistical vision for how
you’re going to pull off enrollment, you’re leaving your ability to have a
successful open enrollment up to chance.
As a department, your first concern is understanding whether
you’ll be leading an active or a passive enrollment. If you’ve recently
rehauled your benefit offerings or you have internal data suggesting that many
employees are on suboptimal plans, then an active enrollment can make a big
difference for your benefits program On the other hand, passive enrollments
work best in organizations with many long-term employees who are generally
happy with their coverage.
If you’re going to leverage technology to streamline your
enrollment procedure (and in 2019, you definitely should) that means your
logistical planning needs to involve your IT team, as they’ll be the people
determining the actual look and feel of the system that your employees will use
to enroll in their benefits. HR and IT must work together to ensure the user
experience is easy, clear, stress-free, and built right into the systems that
employees use for their day-to-day work to maximize accessibility and invite
engagement.
Open Enrollment Challenge #2: Communication
Communication is the probably the single biggest key to a
great open enrollment season, but it may also be the single biggest challenge.
As an HR professional, it’s your responsibility to ensure
that nobody can forget about open enrollment season. At the same time, however,
benefit election time is also when HR departments can actually harm buy-in and
hurt long-term employee engagement by providing the wrong kind of communication
or using the wrong tone with employees.
For example, weekly email reminders to make benefit
elections are useful for employees who have not completed the process, but they
can seem annoying or impersonal to professionals who were sure to make their
elections early in the cycle. Creating a communication strategy that maximizes
that valuable communication while eliminating repetitive or unnecessary messaging
is key to short-term success during enrollment and long-term success
maintaining a great relationship with your talent.
One of the best ways to be successful is by spreading your
message across multiple platforms. If your organization uses an ERP that all
employees work through, partner with IT to get reminders in highly visible
spaces that your team members can’t help but see. If your company has a
preferred messaging system or bespoke communication app, you can use those
channels to send enrollment reminders as well.
Open Enrollment Challenge #3: Education
Education is your greatest weapon to ensure employees choose
their ideal benefits package, maximizing two-way value for talent and the
organization alike. With that said, out of all these challenges, education can
be the toughest one to truly embrace and hold yourself accountable to because
it takes a lot of work.
In order to provide employees with the information they need
to select the plans that are best for their families, you need to think like a
teacher, providing multiple access points to the information and presenting
things in a variety of ways to make sure that everybody understands the
material, regardless of their personal learning style. That means just passing
along the literature from your provider isn’t nearly enough.
Employees require a blend of independent learning
opportunities (like brochures and manuals), large group learning opportunities
(like formal training sessions), and small group (or even one-on-one) support
from benefits-savvy HR team members to maximize their educational level and
resultant engagement potential. Making time for those initiatives requires
buy-in from senior leadership, but education is truly the difference between
setting up your team for enrollment success and leaving them dangling in the
wind.
Open Enrollment Challenge #4: Engagement
Engagement is the special sauce that makes every single
aspect of operations at your organization run smoothly. When it comes to open
enrollment, engagement means a workforce that cares about maximizing the value
of their benefits and getting those elections made in a timely manner.
Health and wellness are crucial points of employee
engagement for any business, but when they are active pillars of the employee
culture, it significantly streamlines the yearly dance of open enrollment. When
talent is engaged in terms of health and wellness, they work toward building
their own understanding of how they’re using their benefits, what they need,
and how they could be making smarter selections. That translates directly into
making the right choices in November.
If that culture doesn’t already exist in your organization,
the lead-up to enrollment season is a great time to brainstorm some incentives
that invite engagement and build a positive, empowered attitude toward
enrollment throughout the organization. The more you can create a positive buzz
for health and wellness, the more active a role your employees will take in
enrollment.
Open Enrollment Challenge #5: Picking the Right Benefits
Partner
Of course, the over-arching challenge that hangs above the
other four is the challenge of offering your employees the very best, most
valuable benefits you possibly can.
Many employee benefits providers try to build a standardized
definition of a “great benefits package,” but for your open enrollment to be
successful in the long term for your department, your organization, and your
talent, you should never settle for a one-size-fits-all approach. If you’re a
small or medium-sized business, this can require working with a white glove
service to help you connect with exactly the coverage you need to support your
team.
Partnering with the wrong benefits broker can and will cost
the organization in the long-term, whether it’s over-spend on unused benefits
or employee dissatisfaction with limited offerings. Finding a benefits partner
who understands your organization, your team, and your goals is crucial to
maximizing employee experience and business value through enrollment.
Key Takeaways
Open enrollment is a complex challenge, but when you
understand each individual aspect of the challenge and can formulate a
proactive strategy that addresses each concern, you maximize your chances to
deliver wins for your employees and organization as a whole. Remember…
- You must plan ahead in the lead up to
open enrollment and create a roadmap for success
- You must communicate positively with your
team in a way that guarantees awareness and provides them with the information
they need to enroll
- You must educate your team in a way that
ensures they are able to make the best benefit enrollment selections for their
families
- You must engage your team in a positive
manner that builds their enthusiasm for wellness in general
- You must find the best possible benefits
partner for your size and goals
by Guest Author | Oct 7, 2019 | Employee Benefits
Building and maintaining an effective team is one of the
greatest challenges that growing businesses face. It’s a constant struggle to
hire the right people, keep the team engaged and productive, and keep top
performers from jumping ship. Given that 80% of full-time employees are living
paycheck to paycheck, taking an interest in your employees’ financial wellbeing
can be an effective way to stand out as an employer.
Most people acknowledge the importance of
employee benefits to winning the war for talent. But they frequently
overlook the potential that financial wellness has to attract, engage, and
retain great employees. Let’s explore why investing in financial wellness can
help growing businesses succeed and how to create an effective financial
wellness strategy, including:
- The importance of financial wellness
- How to effectively leverage 401(k) plans
- Which benefits you should consider in addition to 401(k) plans
Importance of Financial Wellness
Financial wellness benefits can have a significant impact on
employee productivity. Seventy-percent of employees currently experience
financial stress while at work, which should be no surprise given the fact that
most American’s don’t have $500 to cover an emergency expense. What comes as
more of a surprise, though is the fact that employees spend an average of 28
hours a month worrying about their finances at work. That’s almost an entire
week’s worth of productivity every month! Addressing these concerns and
allowing employees to focus on their work should be a top priority for any
employer.
You aren’t just losing hundreds of hours of productivity each
year from your employees’ financial stress either: you’re also risking losing
your most valuable employees to turnover. Employees who are worried about their
finances, and especially those who feel their current employer is not dedicated
to their financial stability, are much more likely to start looking around for
a higher paying employer. This can be an especially potent threat to growing
businesses who frequently cannot compete with major companies when it comes to base
salaries.
Luckily, financial wellness is an extremely cost-effective
way to improve your employee’s financial stress and actual financial wellbeing.
Instead of sinking tens of thousands of dollars into increased salaries, you
can invest in financial planners, 401k plans with optional matching, loan assistance,
financial education, and more.
Financial wellness is not just about avoiding the negative
effects of employees’ financial concerns, either. Your benefits package is a powerful
tool to attract, engage, and retain the talent you need to thrive as a
business. Many employees would accept a lower salary in exchange for better
benefits, and that includes wellness benefits. Once again, this is great news
for growing companies who can’t always compete on salaries. Stellar benefits
show employees that you care about them and will go above and beyond for them,
and they will return the favor.
It’s also a good idea to consider not only whether or not to
offer financial wellness benefits, but also what financial wellness approach
will work best for your business. For financial wellness benefits to work, they
have to meet employees’ financial and psychological needs. Which means that
employees have to actually use the benefits. It also means that there is no
one-size-fits-all approach to financial wellness: your strategy should depend
on the specific needs and demographics of your employees.
401K: Taking a Deeper Look at the Cornerstone of
Financial Wellness
If you had to implement just one financial wellness benefit,
a 401k plan would be a clear choice. According to the 2018 Jobvite
Recruiter Nation Survey, 401(K) plans ranked just after medical and
dental benefits in their ability to attract top talent. That should make them a
top priority for any employer looking to beef up their benefits package and
assuage their employees’ financial concerns.
And the importance of 401k plans makes sense. Almost
two-thirds of employees do not have any retirement savings and those who do
have saved an average of just $40,000. No wonder retirement readiness is a top concern
for employees. But just like any other benefit, 401k plans are only
as effective as employees make them. How can you make sure that your investment
in a 401k plan pays off?
The first thing you can do is implement automatic enrollment
to make sure that all of your employees adopt your new or existing 401k plan:
this removes a major barrier to saving. You can even automatically deduct
contributions from your employees’ paychecks to spur their savings, allowing
them to opt-out if they wish. And if you have the budget for it, 401k-matching
is a time tested strategy that is sure to both encourage your employees to save
and win you major points as an employer.
However, your 401k plan should be just the first step in
your financial wellness strategy. By themselves, 401ks struggle address
employees’ immediate day-to-day financial concerns which are often the cause of
stress and decreased productivity. Many employees are so burdened by debt or
day-to-day expenses that they cannot bring themselves to think about saving for
retirement even if their company offers good 401k benefits. And they are likely
to raid their retirement accounts to pay for emergency expenses without
planning and assistance to give them greater financial stability.
Looking Beyond 401k Plans
So what are the other financial benefits that can make you
stand out against competitors?
One of the biggest financial concerns for today’s employees,
especially for younger employees who are especially prone to switching
companies, is student debt. America’s graduates owe a total of over $1.5
trillion in student loans and most Millennials would trade vacation time for
student loan repayment assistance. Now, there are plenty of pros and cons
to repayment assistance, but you would do well to consider offering
these benefits, particularly if you have young employees. Only 11% of employers
provide any kind of help or guidance on student loan repayment even though
about half of workers want help with the repayment process. But when employers
do offer loan assistance, they hire faster and increase average employee tenure
by more than a third.
So how can you help your employees with loan repayment? The
easiest method is to help them set up dedicated accounts with automatic
contributions to make repayment easier for employees to manage. This approach
incurs few direct costs to you as an employer, so it should be a viable option
for just about any growing company. If you have a bigger budget, you can also
match employee contributions to these accounts. Alternatively, you can work
with lenders to refinance private student loans at better rates. Finally, you
can provide educational materials regarding loan repayment and access to financial
advisors so help make management easier for your team members without directly
assisting repayment.
A robust financial wellness strategy should also include
financial planning and retirement advice. Providing employees with one-on-one
financial counseling can help them build their short-term savings as well as
plan for retirement, holistically supporting their financial well-being. They
can stop worrying about their finances at their desks and put their trust in
the experts who you connect them with. Best of all, this can be significantly
more affordable than matching contributions and other direct benefits.
Financial education is often the most cost-effective financial wellness benefit
and growing businesses can use it to improve employees’ financial wellbeing
with minimal investment.
Key Takeaways
Today’s employees are having more difficulty saving for
retirement, let alone emergency expenses, than in the past. It is probably no
coincidence that they are also changing jobs at an unprecedented rate.
Financial wellness benefits can be extremely effective at retaining the talent
you need and making your employees as engaged and productive as possible. Just
remember:
- Your financial wellness strategy should match your employees’ actual needs to minimize costs and maximize effectiveness through utilization
- 401(k) plans are still the cornerstone of an effective financial wellness package and you can make the most of them through automatic enrollment and contributions, as well as employer matching
- Loan repayment assistance is a rare but highly effective financial wellness benefit that can especially increase hiring, engagement, and retention of top Millennial talent
- Financial counseling and education provides holistic financial support to remove employee stress and improve wellbeing
As with all benefits, it can be difficult for growing
businesses to provide competitive financial wellness benefits without incurring
excessive costs. The right partners can help you develop a strategy that
minimizes those costs while maximizing the impact on employees wellbeing.
You can learn more about how to make the most of your benefits at the lowest possible cost by streaming our webinar “How to Reduce Healthcare Costs at Your Growing Business”. On the webinar, Sean Condon of Windgate Wealth, the author of this guest post, shared his knowledge of 401(k) strategies during the panel-style discussion featuring several leading experts in the healthcare space. Learn more about the webinar and stream it on-demand here.
About the Author
Sean Condon of Windgate Wealth specializes in helping entrepreneurs build a culture of financial wellness by offering their employees unprecedented access to a CERTIFIED FINANCIAL PLANNER™ as well as low-cost 401(k) plans. Part of an employee-owned team, Sean takes an owner’s approach and does his best to understand the many elements of his clients’ own entrepreneurial journeys. Sean has more than ten years of experience as a financial planner & wealth advisor.
