Evaluating Benefits Administration Strategy
  • Benefits Strategy

5 Stats That Could Make You Re-Evaluate Your Benefit Administration Strategy

The world of employee benefits is ever changing, requiring HR and benefit leaders to constantly be aware of the variables that may impact their strategy. An effective benefits strategy must account for everything from regulatory requirements to meeting the needs of five different generations in the workforce.

When used strategically, benefits can be the key to achieving employer of choice status, greater talent retention and organizational cost savings. If that's not enough to convince you to step back and take a look at your current benefits strategy, maybe these industry statistics will entice you:

1. Benefits account for 31.7% of total compensation costs, on average.¹

And with health care costs expected to increase six percent in 2019, you'll want to make sure that growing part of your budget is spent wisely.² 

Some questions to ask to see if your benefit administration strategy is effective in this area:

  • Do you have the visibility you need to see where your health care dollars are going? 
  • How are you helping ensure everyone on the plan is eligible?
  • Are you able to use predictive analytics to estimate costs for plan design changes?

2. Four out of five employees enroll in the wrong health plan.3

When employees aren’t empowered in their benefit decisions, they're left either over-insured (a direct waste of money) or under-insured (leads to major claims expense when employees put off care due to cost and their condition worsens). Employees need the tools to understand their plan options beyond the price of the premium.

Some questions to ask to see if your benefit administration strategy is effective in this area:

  • Can employees easily compare plans and access resources at the point of decision?
  • Are employees able to estimate out-of-pocket costs based on historical claims data and expected utilization?
  • Does your benefit administration system present best-match recommendations based on employee profile and preferences?

3. Nearly 90% of employees feel technology improves their understanding of benefits.4  

A modern benefits platform that includes consumer-friendly, data-driven decision support tools can transform the enrollment process into a simple online shopping experience that guides employees to the best option for their health and financial needs. In fact, 49 percent of employers agree that this type of best-in-class employee user experience is the most valuable outcome of implementing a benefits administration platform.5

Some questions to ask to see if your benefit administration strategy is effective in this area:

  • Is the enrollment process similar to shopping on familiar eCommerce sites like Amazon?
  • Do you use video and other multi-media communication to make benefits easier to understand?
  • Are employees able to access benefits enrollment and information on their mobile device?

4. 26% of employees report having left a job or rejecting a job offer due to the benefits offered.6

With unemployment at an all-time low, and with wages relatively flat, benefits play an even greater role as a differentiator. Benefits strategies should be designed to address the widely varying demographics and psychographics of today’s multigenerational workforce.

Some questions to ask to see if your benefit administration strategy is effective in this area:

  • Does your benefits package include options to supplement health plans and protect employees' financial well-being?
  • What opportunities do you have to differentiate your benefits offering from other employers in your industry?
  • Do your employees understand, and appreciate, the full value of their benefits package? 

5. 37% of employers say the ability to integrate benefits technology with HR functions is the most valuable outcome of implementing a benefits administration platform.7

Lack of sophisticated automation and reporting tools can hinder you from giving your benefits strategy the attention it deserves, impacting key business priorities like talent retention and engagement.

Some questions to ask to see if your benefit administration strategy is effective in this area:

  • Does your benefit management system integrate with your HCM or ERP solution to eliminate redundant work and inefficient processes?
  • Are your payroll deductions automated based on the latest enrollment data?
  • Are you able to transmit enrollment information to all of your insurance carriers and benefit providers seamlessly?

Download the complete step-by-step guide to evaluating your current benefit administration strategy, as well as the technology that supports it, and use the free roadmap to maximize the value of your program for your employees and your organization. 

 

  1. USBLS
  2.  Medical cost trend: Behind the numbers 2019, PwC’s Health Research Institute
  3. Johnson EJ, Hassin R, Baker T, Bajger AT, Treuer G: Can Consumers Make Affordable Care Affordable? The Value of Choice Architecture.  
  4. 2017 Aflac Workforces Report
  5. Pacific Resource HR Technology & Benefits Administration Survey
  6.  2018 Aflac Workforces Report
  7. Pacific Resource HR Technology & Benefits Administration Survey