A recent survey revealed issues employees have with open enrollment season, including material too difficult to understand and not enough time to make benefits decisions.
In a webcast, Mercer discussed ways to make the open enrollment period better for employees and employers alike.
Tyler Harshey, a Mercer actuary focusing on employer and consumer preferences, based in Chicago, first pointed out that passive enrollment maintains the status quo for employees and is easy. If employers like what employees are choosing, and they haven’t made benefit changes, they may want to do a passive enrollment.
However, an active enrollment increases employee participation in their benefits decisions, he said. It is effective when an employer has made changes to benefits; it helps keep employee and dependent information current and it reminds employees of all the employer’s offerings. “Health savings account (HSA) and flexible spending account (FSA) funding elections are annual decisions, so why not pair this active decision making with medical benefits,” Harshey said.
He also suggested employers should consider the order in which benefits are presented. All benefits should be presented in one place, but employers should present medical, dental, vision, HSA and FSA benefits first then life, accident and disability insurance and voluntary benefits last. “In the Mercer Marketplace, we’ve found order matters,” Harshey said. “Employers can see more enrollment in certain plans if they change the order of presentation a bit.”
According to Harshey, choice helps different segments of the workforce. Mercer found among those younger than age 30, 20% are not confident in being able to afford out-of-pocket expenses, and among those age 60 and older, 15% are not confident. In addition, 35% of younger participants prefer to pay higher premiums in exchange for lower out-of-pocket costs, as do 55% of older participants. By salary, employees making $110,000 or more are more confident in being able to afford out-of-pocket costs, but still half prefer a higher premium.
Mercer also found that whether an employer offers three, four or five health benefit options, a significant number of employees enroll in each option, though there is still a skew toward richer benefits. But, according to Harshey, offering more than that could result in diminishing returns.
Offering Decision Support
Harshey suggested employers use decision support tools to help employees—online educational content, phone consultations, cost calculators—but, he said, one-on-one face time is the best. “Keep it simple and quick to use, personalize the experience and embed support tools within the enrollment flow so employees have them at the moment they need them,” he said. “Employees are more likely to use embedded tools than if the tools are on other sites and employees are given a link.” Mercer suggests well-placed videos and text, provider search tools or formulary search tools to decide between two networks or whether medications are on a provider’s formulary. In addition, Harshey said, Mercer uses “robo-advisers” which gather demographic data from individuals to come up with recommendations.
Cindy Schrader, a member of Mercer’s Total Health Management Practice in Philadelphia, suggested employers offer cost transparency tools to help employees become sophisticated shoppers of health benefits. A Mercer survey found 72% of large employers plan to offer high-deductible health plans (HDHPs) by 2019, but only half of all consumers knew where to go to get cost and quality data.
During open enrollment, employers should help employees understand what is shoppable—medical services and pharmacy costs—and employers should show employees how to navigate tools and use the information. Schrader suggested employers should test drive tools before choosing what to offer employee. They should be easy to access and easily understandable.
In addition, she said some employers are giving employees reasons to use the tools. “Employers are embracing loyalty rewards for employees who use the tools,” Schrader said.
Communication Should Be Year-Round
David Slavney, a member of Mercer’s Workforce Change and Communication Practice in St. Louis, Missouri, said health should be a year round conversation.” Health decisions happen outside open enrollment season,” he points out.
As for the cost and quality transparency tools Schrader discussed, she said employers should leverage communication channels that have the ability to personalize data. Employers can use vendors to prompt messaging, based on an employee’s health data.
Plan sponsors can also help employees prepare for conversations with their health care providers. “Make sure they understand their benefits, deductibles and co-pays; pull together a list of questions about certain proposed treatments and illnesses as well as potential treatment alternatives,” Schrader said. “And remind employees of the available tools and resources to help them and their doctors make informed treatment decisions.”
Slavney said communications must simplify the complex. Employers should break communications down to smaller pieces—not a 15-minute video, but a two- or three-minute video. In addition, information should be meaningful and relevant. Employers should segment the employee audience to target messages. “Think about how to break information into chunks to point out things relevant to particular participants. Help them think, ‘If I do this, this will happen, and if I don’t, this will happen,’” he said.
According to Slavney, now is the time to accelerate communications toward digital approaches. Many vendors use mobile applications, and employers should not just tell participants to get a certain app, but tell them how it will help them. He added that employers should use text messaging opportunities, contending that employees react more to texts than emails.Slavney said traditionally employers have looked at open enrollment as an event just repeated each year, but he encouraged employers to think about their strategy and be experimental, then learn from their experiments to inform future decisions.