Making a Health Plan Decision: Do Employees Have Too Many Options?

Quick look: Securing what employers and employees want requires a different approach than in years past. Benefit customization, rising healthcare costs, and inflation are all modern-day concerns to address this coming enrollment season. It might feel early, but it’s never too soon to get started, and brokers who work closely with PEOs show they’re ready to rise to the occasion.

With summer just around the corner, talking about fall’s open enrollment may seem premature. But as every broker knows, when it comes to making health plan decisions, it’s best to be ready for anything.

People seem to have more choices than ever, but decision overload could be preventing them from making the best one. An Employee Benefit Research Institute (EBRI) and Greenwald Research survey reveals 72% of employees spend less than an hour reviewing their health plan options during open enrollment. And it’s not necessarily because everyone is confident in their selection. The survey also shows:

• 20% of employees are automatically enrolled in their health plan every year, based on previous selections
• 29% of employees enrolled in a high-deductible health plan reported they had three to choose from, making comparisons more daunting
• 27% reported high stress of health plan costs due to inflation

Employees often want to take more time to review their options, but when open enrollment arrives, their availability and interest may waver. Therefore, it seems simpler to opt for their previous plan or stress-pick a selection, regardless of whether it aligns with their best interests.

Health plans are one of the top business expenses, and when employees don’t utilize benefits offered, it’s a wasted cost and effort for all parties involved. To help small- and medium-sized businesses (SMBs) determine what truly matters to their workforce so cost and effort are allocated appropriately, a professional employer organization (PEO) broker can call on expert support and resources to customize solutions.

After all, answering the million-dollar question – what do employees want? – is not set in stone. What employees want today may greatly differ from what they need tomorrow. Therefore, it’s best to leave assumptions aside to reach the best possible decision.

Engaging employees during open enrollment plan

79% of employees say they’d rather have the option of additional benefits over a pay raise, which means it’s crucial for employers to maximize their value. The EBRI survey lists the following as “very or somewhat important”:

• Good network of healthcare providers
• Low out-of-pocket costs and premiums
• Prescription drug coverage
• Simple to understand

Although most SMBs prioritize these areas, there’s still a common disconnect when it’s time for employees to make a decision. Perhaps what’s needed is extra time to review, ask questions, and think about their choices ahead of the open enrollment period.

It’s helpful to take a pulse of a company’s needs to pivot as needed. Rather than infrequent check-ins, PEO brokers have the support, resources, and time to engage SMBs and their employees year-round by:

Conducting engagement surveys

To get the most value from a benefit plan, it’s essential to connect with what employees need and want now. There’s no catch-all solution to fall back on, as there are five generations in the workplace. SMBs have a healthy mix of people of different ages, backgrounds, and stages of life, which means the status quo no longer applies. Because of this, benefit needs differ from worker to work and also, will likely change as they continue employment with the company.

Communicating through different methods

Improving employee engagement also means acknowledging not everyone absorbs information in the same way. It’s favorable for brokers and SMBs to communicate health plan benefits in various ways to make them more inclusive. Some prefer online sessions while others prefer smaller, in-person meetings to learn about specifics. Furthermore, verbal communication may not be as impactful for some compared to visual plan comparisons.

Highlighting plan benefits and changes

When sharing health plan options, call out specific benefits of each and highlight any changes from the year prior. This can help those who auto-enroll take a more active approach to their benefits and possibly, receive a better value with another choice. The goal is to empower employees to make informed decisions even if they don’t end up changing plans.

Anticipating and addressing concerns

Health plan jargon and acronyms can be overwhelming, particularly for those new to choosing a health plan. Simplify language upfront and allocate time for employees to ask questions either one-on-one or in a group setting. Engaging employees is an ongoing effort, but with the support of a PEO, brokers can give them the tools, resources, and confidence they need to make strategic, smart decisions.

Personalize the process with a PEO

The complexities of HR requires knowledge of the latest benefit trends and the ability to narrow down which ones apply to each particular SMB. Personalization is impactful as employees demand more from their companies regarding benefits but don’t all demand the same thing.

A PEO broker has the advantage of bridging together SMBs with a team of HR experts who value customization and provide:

• Access to premium-level benefits at affordable costs to stay competitive with larger companies
• Expert insight on the latest in benefit trends and best practices to provide flexible strategies
• Ongoing employee communication for optimal understanding of benefit offerings
• Risk and compliance services to navigate government regulations regarding changes to employer-sponsored health and 401(k) plans

These reflect the core of what PEO services entail, but to ensure SMBs make the most beneficial decisions during open enrollment, it requires exceptional customer service. Unlike big-box PEOs which are driven by quantity, PEO brokers who partner with ExtensisHR are focused on delivering meaningful quality. This is exemplified through:

• An 82% Net Promoter Score (NPS) score (compared to the 37% industry average)
• Top 1% of accreditation (ESAC Accreditation, Certification Institute (CI) for Workers’ Compensation and Risk Management, and IRS Certified PEO (CPEO))
• 97% same-day response rate

Engaging the support of HR experts to guide SMB clients through open enrollment can improve the experience for everyone. As a people-first organization, ExtensisHR is driven by collaboration, results, and an innate desire to do more for you and your clients.

Learn how our PEO can boost your portfolio. Connect with our team today.