Not all health plans are the same, and many employers offer their employees several choices.
Employees are asked to make those decisions during an open enrollment period, and employers have a responsibility to make sure that their workers have all the information they need to make the choice that is right for them.
“Education is the key,” says Don Whitford, vice president of Sales and Client Services for Priority Health. “You need to make sure your people understand the choices available to them.”
Smart Business spoke with Whitford about how employers can prepare their employees for open enrollment and the decisions that they will be asked to make.
What is the first thing employers should consider before presenting their employees with benefits options at open enrollment?
One of the critical things the purchaser of a plan needs to know is how to evaluate the current plan. Review all options available to you and make sure your plan fits your health care objectives and goals.
The upward pressure on employers regarding health care costs continues to be there.
Consider where you want to take health care in the future. Are you partnering with the right health care carrier to help control long-term per-capita health care costs? What kind of disease management programs does it have in place to treat people early on, before the long-term, expensive health care costs down the road?
To really dig into the options available to you, have either the carrier representative or your agent clearly explain how they will help you manage your long-term costs.
Once benefits are determined, how does the open enrollment process work?
Employers can do different variations, but the basic process is simply determining what the benefits will be for the upcoming year. Then, the employer decides what level of employee premium contribution it will require. That ties back to your goals and strategies, what you’re trying to accomplish.
Then you need a heavy dose of active communication with your employees. Here are your plan choices, and if the plan choice is the same as last year, tell them. If it is different, they need to know that. And if it is different, point out those differences.
This is driven by the size of the employer, but most employers will hold open enrollment meetings. At these meetings, the employer’s human resources team will answer questions. Employers can also engage their carriers or agents to explain the choices to employees. When changing benefits, most employers go with the latter option and work with the carrier to create communications to make sure people fully understand their choices and the time frame to make those choices. If you are just continuing benefits, you may approach it with a lower level of communication. But with either option, it is important to communicate.
How can employers help employees understand their choices?
You can send out benefit summaries, or a link to the carrier’s website with benefit descriptions.
Also, you need to get members engaged. If you are bringing carriers in to do presentations, also do wellness activities or a health fair. Offer blood pressure testing or biometric screening as part of the activity to encourage participation from your work force. You can also invite spouses to participate. Females in the families tend to make the decision on health care, so you need to find a way to get that information to the real decision-maker in the family. You can do that by having them on-site, reaching them through mailings, or referring people back to the company’s own website.
How can an open enrollment period affect an employee’s coverage and cost?
The first way would be if the employer offers more than one plan design. Most carriers will allow the employer to select a couple plans, depending on group size, so at open enrollment, employees have the option of changing their benefit design.
The other thing employees can do during open enrollment is make membership coverage changes that they didn’t make throughout the year and should have. There are certain qualifying events that happen such as marriage, birth, adoption, divorce or separation, or death of spouse or dependent where you have a certain time frame to add or remove people from the plan. If the member missed the time frame for the event, open enrollment is the time when members can make sure their contract is accurate and up-to-date.
If employees have more than one choice, the biggest change they can make is to plan design. In that instance, individuals will use their own purchasing criteria, looking at benefit designs and what best fits their needs, then match that to the cost associated with it, whether it’s an employee premium, deductible or coinsurance levels.
How can an employer decide how many choices to provide?
Carrying more than one plan is more administrative work for employers because they have more things to manage, but most carriers will have a size threshold. Small companies get one plan; larger companies may get two or three.
Employers should look at the needs of their work force and determine how they can best satisfy those needs. It goes back to their long-term health care strategy. One size doesn’t fit all.
Don Whitford is vice president of Sales and Client Services for Priority Health. Reach him at email@example.com or (248) 324-4711.