Helping People Make Better Benefits Decisions

 In Thinking

With open enrollment fresh on our minds, it’s crucial to ask ourselves: How many employees truly understand the benefits choices before them? Most people do one of two things:

1. make selections solely based on the deductions they can afford each month
2. give up and make no change at all

In fact, less than 10% of employees make updates to their benefits during open enrollment, and 36% say the enrollment process makes them feel frustrated, anxious, or confused. This sheds light on an important issue: many employees perceive open enrollment presentations, materials, and instructions as unhelpfuland as a result, are missing out on better benefits experiences.

This leads us to an even greater question: How can we leave this process as is and expect employees to make informed and meaningful choices? The answer is, we cannot.

Ensuring that employees have the right support in place to understand benefits information is critical. As health plans in particular become more nuanced, plan selection tools can follow suit. Providing personalized support to employees for their benefits decisions is just as important as providing support to increase their benefits utilization later onas a matter of fact, the former can help enable the latter.

One-size-fits-one support

Instead of relying on employees to do the tedious research necessary to make the best benefits selections, employers can now do more to help. Open enrollment decision support tools are powerful ways to bridge this gap. Data-informed solutions like these can take the rolling 12-month utilization (minus one-time events, such as transplants, accidents, etc.) and then offer recommendations about the health plans that will save the employee the most money going forward by replaying their prior utilization in each of the future plan scenarios.

For example, two large employers used this type of support tool to communicate with their employees two weeks before open enrollment. Employees received information for each plan that was available to them, including a breakdown of their estimated copays, coinsurance, deductibles, and monthly paycheck deductions. This helped them estimate the total cost of healthcare if they chose that particular plan. For some employees, the best option presented was to stay with their current plan, while for others, the best route was to switch. This recommendation was clearly highlighted to make it easy for them to follow.

Of the first company’s employees who switched plans, 60% switched to the tool’s recommended plan, and of the second company’s employees who switched, 52% switched to the tool’s recommended plan.

For those employees whose comparison resulted in a compelling case for an HDHPa plan type that many people associate with higher out-of-pocket coststhis tool helped them understand the total cost of healthcare as a driver of selection, rather than the fear of deductibles. HDHP enrollments in this scenario had relative increases of 18.3% for the first company and 42% for the second company. The high-deductible plan was actually a better choice for these employees, which they were able to see after taking all personally relevant factors into account.

Beyond the traditional options: High-performance network plans

As employers increasingly offer high-performance networks at the point of enrollment, employees may now have to choose between plans that have identical designs but different provider networks. It’s not enough to simply present the best plan choices solely based on cost and stop therethe employee needs to know the implication of these plan choices with respect to their doctors. For instance, what trade-offs will they have to make if they go with the cheapest plan? It comes down to balancing two questions:

1. How much will it cost me overall?

2. Can I still see my doctors?

If it turns out the employee’s doctors don’t participate in the least expensive plan available to them, it’s important that the employee is able to easily search for other highly rated physicians who do participate in that plan. Powerful plan choice tools provide recommendations of high-quality providers that are in-network, along with a comprehensive search function that lets users extend the search for themselves. This helps to reduce the anxiety associated with finding a new doctorand prevents the employee from passing on a health plan that is otherwise well suited for them.

When people can clearly see the differences in cost and physician options, and how those options relate to them personally, they can make a truly informed selection. Personalized information that illustrates the real-world impact of the employee’s plan choices gives them a more objective basis for making decisions with confidenceleading to lower costs, and many times, even to better outcomes.

Coming full circle

Simply put, we can’t expect benefits engagement if people aren’t choosing benefits that are relevant to them in the first place. Increasingly, the success of our strategies going forward (ones that lead people to higher quality care at lower costs) will depend on those individuals making the right choice at the point of enrollment. As human resources and benefits professionals, we can help them along in that endeavorwith the intelligent use of data that helps employees simplify their decision-making, while also improving their satisfaction with that decision. In the process, smarter decisions become easier to make, and benefits experiences become more meaningful.