Creating a Better Open Enrollment Experience for Employees

Open enrollment season is fast approaching, and employees are dreading it, according to a survey sponsored by MetLife.

One-third of American workers would rather talk about their weight than their employee benefits, and nearly half dread the benefits enrollment process as much as asking for a raise, the survey found. In addition, one in five workers spend only a few minutes reviewing benefits offered by their employer before making a decision.

However, a survey, “Employee Insights on Open Enrollment,” found nearly two-thirds of American workers did not automatically choose the same benefits as the previous year, indicating they are putting more thought into their choices during open enrollment. The survey of 2,000 employed adults, conducted by Morning Consult on behalf of Prudential, found that in most cases, the 65% who chose new benefits credited their employer for using a variety of communication methods to keep them informed.

Alegeus’ 2019 Open Enrollment Exit Poll found close to half (46%) of consumers had an average, or less than average, open enrollment experience, and 22% lacked confidence in the health plans and other benefits they ultimately selected.

The survey also indicated 30% of employers did not help their employees evaluate and pick their health care benefits, leading the majority of employees (70%) to keep the same health plan they had the previous year. More than half (56%) of employees either didn’t understand the available options, were unsure what their out-of-pocket costs would be, couldn’t determine the best options for their families, or weren’t sure how much to contribute.

Helping employees make the right benefits decisions can not only help them save money, but it helps employers save money too. Looking to the upcoming open enrollment season, the National Business Group on Health, using data from its annual Large Employer Health Care Strategy and Plan Design Survey, reveals more than three in four employers (78%) plan to offer medical decision support tools and second-opinion services. In addition, approximately 60% will offer full-service, high-touch concierge programs that help employees navigate the health care system.

“With health care costs on the rise and the continuing shift of those costs to employees, it’s more important than ever for employees to understand all of the benefits available through their workplace. Health benefits are important, but supplemental insurance, health savings and spending accounts, and retirement savings plans are important to more holistic physical and financial wellness,” says Rob Grubka, president of Employee Benefits, Voya Financial.

To encourage employees to spend some time reviewing and choosing their benefits, Grubka suggests that employers consider ways to share information about benefits offerings throughout the year, so employees have a solid understanding of the benefits before having to make a choice. For example, send reminders from time-to-time about updating beneficiaries or how to place a claim, or share real-life examples of how different benefits help people.

The MetLife research revealed that learning from others’ experiences can help employees better understand how their choices connect to their overall financial wellbeing, which it says is critical to feeling confident and informed going into open enrollment.

“Sending information about all of your benefits only during open enrollment is like cramming for a final. Too much information all at once can be overwhelming and lead employees to simply default to last-year’s benefits,” Grubka says. “Also, be sure your messages are in what we call ‘Saturday language,’ rather than insurance-ese, to make it easier and quicker for employees to understand their options and take action.”

Grubka also recommends that employers encourage employees to estimate their annual medical costs. “Share a worksheet or calculator to help employees add up their medical expenses from the previous year. This will give employees a baseline of what their covered and out-of-pocket costs might be for the new year. Then have them add on any new items they anticipate—a baby on the way, a knee replacement they’ve been putting off, or other factors that might impact their health care costs and savings. They can then use this information to determine which supplemental benefits to choose, if they should increase their group life insurance coverage or how much they should set aside in an HSA [health savings account] or FSA [flexible spending account],” he suggests.

During open enrollment, employers should make enrollment in benefits active and not passive, Grubka adds. Have employees opt-out of the benefits, rather than opt-in. If employees have to opt-out of each benefit, they’re less likely to just glaze over it or ignore it completely.

According to the Prudential survey, a majority of American workers (58%) said that if auto-enrolled in an insurance policy, they would likely keep it rather than opt out. Just 5% said they would opt out, and 37% said they would consider the cost before deciding whether to stick with it.

“In many cases, an enrollment form is a laundry list of benefits. The easy way out in the short run is for employees to simply default to what they had last year and never give a second thought to the rest of the benefits line-up. But in the long run, this could lead to significant time, money and stress if an employee has an unexpected health issue without the proper financial protections in place. Aggregated Voya Retirement plan data for full-year 2017 shows that nearly one in three hardship withdrawals from retirement savings plans are a result of an emergency medical expenses,” Grubka notes.

He also suggests employers consider putting benefits choices in an order that makes the value of the benefits more obvious, such as listing accident and critical illness insurances after health care plan choices. “Or, if an employee selects an HSA-eligible health plan, then link directly to your HSA enrollment page,” Grubka says.