If your employees are typical, fewer than 20 percent know how much you contribute each month toward their health insurance premiums. How can employees value their benefits if they don’t know what they cost?
Surprisingly, most employees also don’t know how much they themselves pay toward their own and their dependents’ health insurance premiums. In a Kelton Research survey released in the fall of 2011, fewer than half of employees surveyed could say how much they contributed toward their employer-provided health insurance premiums. Slightly more than one-third (35 percent) knew what their plan’s deductible was, and only one-third knew how much they had to pay toward dependent coverage.
You can improve these figures by taking time to review your benefits communications and decision-support system. Driving employees to the right plans increases employee satisfaction with benefits, and it can help contain healthcare costs for both your organization and your employees.
Historically, companies discuss healthcare benefits with employees before the annual “open enrollment” period (usually fall to January 1). These communications may cover legal compliance (and in best cases inform employees of their options), but it does little else to help lower costs and motivate employees. Creating a year-round, dynamic conversation between your company and employees can help you create a dialogue that moves the perception from “us against them” to “we’re in this together.”
In general, benefits communications are too complicated, prompting employees to either ignore them or put them aside in frustration. In 2005, Paul Boulis, a senior vice president with Blue Cross and Blue Shield of Illinois (BCBSIL), testified to the Advisory Council on Employee Welfare and Pension Benefit Plans. His statements summarize many of the problems with benefit communications. “Communication tools that overwhelm participants with information might not provide answers to their most important and urgent questions....The disclosure document needed to fully explain the health plan design is lengthy and many plan participants do not have the time to read and study it. In addition, BCBSIL believes that a certain population responds better to personal explanations. Finally, when individuals are under stress due to a personal or family health issue, they want answers quickly.”
The Kelton survey confirmed this, finding that one-quarter of employees with employer-based coverage reported never spending more than 30 minutes on reviewing their coverage options during open enrollment. That’s too bad, because every year, an estimated 80 percent or more of employers revamp their benefit plans, but only 20 percent of employees make new elections. That means many are likely not selecting the options that are best for them and their families.
Improved communications may also reduce your workload considerably. A Gartner study found that HR organizations spend between 70 and 80 percent of their time dealing with administrative activities. Often employees can deal with these activities online using a self-service HR portal, once they understand how to use it.
Here are some strategies for improving your benefits communications and making employees more satisfied with their benefits decisions:
Set goals: A benefits communications plan should include well-defined, measurable performance outcomes. For example, if you want to encourage the use of generic drugs, design your communications to inform employees about generics.
Define benefits within a broader context: Your communications should provide employees with information about benefit costs and their impact on company performance. They should specify what employees can do to help minimize the effects of cost increases on themselves and the company.
Engage management: Every employer should view the healthcare cost crisis as a business issue affecting profitability that should not be shouldered by the HR department alone. Management can help by working to define issues, encourage employee partnership and guide key behavior changes.
Make it relevant: Your communications should cover any or all of the following:
- Benefit overviews and updates
- Orientation, training and educational programs
- Comparison charts
- Legal updates
- Provider directories
Make it accessible: Make your communications available through a number of channels:
- Brochures and leaflets
- Paycheck stuffers
- Presentation materials
Don’t forget to get employee input—an employee survey can help you determine which communication methods and materials are most effective for the particular needs of your group. For help in making your benefits communications more effective, please contact us.
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