Digital Transformation Benefits Administration Costs Public Sector
  • Benefits Strategy

How Digital Transformation Can Help Public Entities Reduce the Cost of Benefits Administration

Over the past several years, technology has fueled an ever-accelerating revolution in organizational efficiency. Agile, extensible platforms like Airbnb, Amazon and Uber have created a new standard for how companies can increase value for their customers while decreasing the level of effort and cost required to do so.

When applied internally, HR professionals are finding that digital transformation enables them to deliver a better employee experience with much less administrative burden. This is especially true when it comes to benefits, which have become an increasingly complex yet essential piece of employer talent attraction and retention strategy.

In the public sector, where complexity is perhaps highest, new technology offers a massive opportunity for organizations to achieve the efficiency needed for their benefit programs to be competitive with the private sector.

Here are three key areas where digital transformation can help public entities reduce the cost of benefits administration.

Configurability & Scalability

Managing benefits enrollment and eligibility across all employee populations in a public entity can be extremely challenging.

While private-sector companies often have the ability to set their own business rules for benefits at their discretion, organizations in the public sector are beholden to the governance of state statutes. When you're talking about benefit plans that cover hundreds of thousands of public servants, these statutes create a heavy administrative burden. Without technology that can automatically enforce all of the various business rules, the risk of non-compliance is high.

To mitigate that risk, some public entities still use a largely paper-based process for benefits administration, lacking confidence in their technology's ability to properly enforce their business rules. Others use technology but don't give employees self-serve access, instead requiring their HR or benefits teams to input everything to ensure compliance. Either way is a huge drain on time and resources.

With a scalable benefits technology platform that can 1) be easily configured to account for a wide variety of business rules –and easily reconfigured when those rules change by law – and 2) handle massive quantities of data to support their large employee populations, public entities can significantly reduce the administrative burden of ensuring compliance.

Communication & Engagement

Communication is essential to the success of any benefits program. But it can often be very time-consuming. In fact, over half of benefits professionals report that they spend the largest portion of their work time communicating to and with employees.Putting together educational materials, conducting meetings, sending emails, answering phone calls... it really adds up.

In the public sector, where an organization's benefits often extend across hundreds of employer units and locations, efficient and consistent communication is even more of a daunting task. Add in the complexity of highly diverse employee populations (e.g., part-timers, pre- and post-65 retirees, surviving spouses, former legislators, etc.), and it's a wonder that public sector benefits professionals have time to do anything else at work!

New technology can be of great help in the communication department. Targeted messaging capabilities enable benefits professionals to engage with different populations with messages specific to their needs; online video provides a powerful and creative way to communicate at scale; and mobile apps offer employees the convenience of anytime access to benefits information in the palm of their hand.

Artificial intelligence (AI) applications create even more opportunity for public sector organizations to increase the efficiency and effectiveness of their benefits communications. Chat bots, event-driven recommendations and the like are enabling a new level of personalization and proactive engagement to help benefits professionals spend less time answering calls and emails, and more time driving innovation in their programs.

Learn more about how to drive effective benefits communication with Benefitfocus' Open Enrollment Success Kit.

Data Quality & Accuracy

When it comes to benefits administration, data quality and accuracy are everything—making sure that employees have the coverage they're supposed to have, when they're supposed to have it.

Due to the size and complexity of their employee populations, public entities typically have to manage an enormous amount of benefits data. And unfortunately, the more data, the more potential for mistakes in the transfer of that data. Without a high level of automation in benefits technology, it can be very difficult to catch and correct any errors in a timely manner.

The consequences of poor data quality are especially costly in the public sector. Premium leakage due to ineligible plan members not only means the organization is overpaying for health care, it also means a waste of tax payer dollars. This can lead to burdensome lawsuits requiring benefits teams to spend time pulling records and conducting audit trails.

With technology that can automate benefits data exchange and reconciliation, public entities can greatly reduce their risk, while also boosting operational efficiency.

Learn more about how digital transformation is helping the public sector increase benefits program value while decreasing the cost of administration in this on-demand webinar.