Inevitably, this year, the complexities facing businesses and HR teams during open enrollment season will be heightened due to tighter budgets, the rising costs of benefits, increasingly stringent compliance regulations, and the need to craft a benefits strategy that positions the organization as an employer of choice in a competitive job market.
In this blog, we’ll take some time to delve a little deeper into some of the most common obstacles companies encounter as they execute their enrollment season strategies and consider some tactics for mitigating them.
Many employees find open enrollment confusing, intimidating, and stressful as they struggle to interpret their benefits plans. Some finish the process with more questions than when they started and don’t fully understand what they signed up for.
In our previous article, we highlighted the importance of diversifying the channels available to employees to get the information and support they need to make informed decisions. Traditional channels such as email and on-site information sessions should be complemented with digital methods like easy-to-digest online FAQs, virtual 1-on-1 consultations, videos and graphics, and two-way messaging.
Recent advances in digital technology have opened the door to take this a step further while reducing the administrative burden on internal resources. Some companies have introduced chatbots and virtual assistants using AI and natural language processing to provide initial assistance to employees without the need for call centers or intervention from an HR team member.
Employees weighing trade-offs between plans with different coverage levels, deductibles, and out-of-pocket maximums will benefit from interactive decision-support tools.
Today, there are five generations in the workforce, each with different benefit requirements. For example, while traditional benefits are important to Gen Z employees, flexible work arrangements and student debt repayment programs also have a strong appeal.
Offering a mix of traditional, flexible, and voluntary benefits will ensure employers accommodate the different needs of a diverse employee base without overshooting their budgets.
Financial well-being is a benefit that can help employees at every stage of their lives and careers by providing guidance customized to their individual needs. Financial wellness programs help younger workers establish a firm financial footing early in life and support older Millennials, now approaching their 40s, to get their retirement savings plans in order. They can also help older employees who might find themselves taking care of their children and their parents at the same time find ways to cope better financially without dipping into their retirement savings.
The best financial wellness programs include earned wage access, which gives employees the option of accessing a portion of their already-earned wages in between paychecks if they find themselves short of cash without having to resort to high-cost borrowing options like payday loans or overdrafts. Before using Payactiv’s earned wage access1 solution, 30% of customers used payday loans, and 33% used overdrafts to access money between paychecks. Upon introducing Payactiv, payday loans and overdraft usage plummeted by 70% and 69%, respectively.Offering earned wage access as a benefit also puts companies on track to better compete with gig economy employers for talent. Some 70% of people working in the gig economy say their job provides access to wages immediately after their shift. Earned wage access levels the playing field by giving employees “instant liquidity.”
Navigating the ever-evolving federal, state, and local compliance landscape related to employee benefits is a complex task. Organizations must:
Non-compliance with these regulations can result in severe financial penalties and legal ramifications.
The cost of health insurance, medical treatments, and prescription drugs continues to rise, often surpassing inflation rates. This year, many organizations will find themselves struggling to strike a balance between offering an employee benefits package that’s attractive to new hires and controlling costs.
Strategies that combat rising healthcare costs include alternative healthcare models like on-site clinics, telemedicine, and preventive care programs. Implementing mental health and financial education programs can help reduce the need for costly stress-related medical interventions down the line.
Organizations should also shop around for insurance providers that offer the most competitive rates and try to negotiate discounts with healthcare providers. This can further ease the financial burden on both the employer and employees.
As companies continue to navigate a complex business and benefits landscape, this year’s open enrollment season will surely present challenges. However, reflecting on your communication model, it’s important to keep a sharp eye on regulation, compliance, and cost management. You can also adjust your package to appeal to a multigenerational workforce can make the experience a positive one for you and your employees.Help your employees fully engage in both work and life with Payactiv’s all-in-one Livelihood benefits platform.
1 Earned Wage Access requires employer participation. Employees can only access a portion of the wages they have earned to date.
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