Assessing the Value of Your Employee Benefits Program
*Part 1 of our Open Enrollment blog series
For many public sector employers, annual open enrollment is right around the corner. Open enrollment is an opportunity to showcase your benefits program and the value it provides to your employees. Before open enrollment begins, it’s important to evaluate what you offer and if those offerings are valuable to your employees.
The quality of your benefits program is one of only a handful of things employees focus on when choosing their employer and also weighs in on their decision to stay. In such a competitive marketplace, a “light” benefits package may make an employer less attractive to skilled workers and can be the deciding factor for an applicant to accept another job.
Employees in the public sector are especially aware of how benefits and retirement contribute to their total compensation package, and comparing how your offering stacks up next to the competition, is common practice. The evaluation of what’s working, what’s not working, and what’s missing in your current benefits program is key to enriching your benefit offerings, to recruiting, and retaining talent within your organization.
So, how do you determine if the benefits you offer are valuable and competitive to your workforce?
Ask Your Employees
Go straight to the source! Ask your employees for their honest thoughts and opinions with an anonymous survey. Regularly surveying your employees is common practice, but if you don’t have a current strategy, it’s never too late to start. Surveys are a great tool to gauge what matters most to employees and their dependents.
Conduct a survey on your benefits program at least once a year, preferably at least 2-3 months before your annual open enrollment period begins. This lead time ensures that your organization has the opportunity and bandwidth to make improvements to your benefits program based on employee feedback, budgetary considerations, and vendor renewal requirements. Another tip to consider, keep questionnaires brief and to the point to help increase participation.
Review Employee Participation and Claims
Now that you have feedback from your employees, be sure to evaluate their participation in the benefit plans you currently offer. High participation indicates that employees value the benefit enough to enroll themselves and their dependents.
Low participation indicates the opposite – that employees do not know or value the benefit enough to enroll in it. If it’s not valuable to the employee, that could be a signal that something needs to change. That change could be cost, plan design, education, or all of the above.
Knowing the frequency of claims filed and the service tied to those claims can also help you determine which benefits to focus on first. For medical, the carrier provides an employer with a utilization review, making it easier to evaluate how employees are utilizing the plan and determine cost and trends. For example, if there is a high number of hospital claims, it may be wise to consider offering a Voluntary Hospital Indemnity plan to help cover out-of-pocket expenses.
Your benefits consultant should assist with helping you determine the efficacy of your plan designs, claims utilization, and future trended costs and value of all benefits.
Education and Communication Strategy
Sometimes it’s not the quality of the benefit plan, but your employees’ knowledge of its availability and how to use it that affects perceived value. When conducting employee feedback surveys, and evaluating participation and claims, don’t forget about the crucial role of benefits education and communication.
Factor specific questions into your survey that help you determine if your benefits education and communication strategy needs a boost. You can ask employees to rate their knowledge of the benefits offered. You could also be more direct and ask employees if they would like to understand their benefits better.
It’s important to know HOW your employees like to receive their communications. A multilevel approach often works best. Texts, calls, emails, or employee intranet messaging should all be considered based on your demographics. While many employees are tech-savvy, you may have a select group that needs a more personal approach. While not always practical, being aware of any gaps in your communication strategy is helpful.
If you find that your strategy requires a boost, there are resources in the marketplace that can help. We’ll dive into those in Part 2 of our Pre-Open Enrollment blog series. ☺
Needs Assessment and Gap Analysis
After you’ve surveyed your employees and identified strengths and weaknesses in your current benefits program, gather what you’ve learned and conduct a full analysis. Some questions to consider during this time:
- Can benefits that are underused or not valued by employees be eliminated? What would the impact be?
- What benefits do employees want that are currently not offered?
- What are the roadblocks employees face that prevent them from enrolling in the benefits they want?
Be mindful that benefit changes may have an effect on your current provider contracts, underwriting, and pricing. Often there are contractual participation minimums. Talk to your benefits consultant to strategize and make certain nothing is overlooked.
Seek Expert Guidance from VSMG
If you’ve followed all the suggestions above, but you’re still feeling unsure or feeling overwhelmed, seek the guidance of your benefits consultant. A benefits consultant can add tremendous value when it comes to evaluating demographic needs, utilization, benchmarking, and helping you navigate changes with ease.
If you’re curious about how your benefit plan and open enrollment practices stack up against your competition, let’s chat. VSMG partners with Arizona public sector employers on all employee benefit-related matters including benefits administration, benefits programs, budgeting, forecasting, wellness, enrollment support, and more. Contact us today!