Thousands of U.S. employers spend countless hours each fall developing benefits communications before open enrollment. Yet despite their best efforts, it appears most employees do not understand their benefits.
According to the Health Insurance IQ Survey of 1,004 nationally representative Americans ages 18 and over, conducted by Kelton Research on behalf of eHealthInsurance in September and October, fewer than 35 percent of those with employer-based health coverage know their medical plan's annual deductible. Perhaps most troubling for employers is the fact that 45 percent of respondents don't know when their company holds open enrollment, and 25 percent said they spend less than 30 minutes reviewing their benefits options.
Ironically, a June 2010 Harvard Business Review survey sponsored by employee benefits provider Unum Group revealed that 43 percent of human resources leaders say their employees are satisfied with their benefits, however 23 percent say their employees find their benefits communication lacking. And a June 2011 Aflac WorkForces Report indicated that 42 percent of employees strongly agree that a well-communicated benefits program would make them less likely to leave their jobs.
"Most employees don't look at their benefits material until they have an issue, and employers need to overcome that inertia," says Helen Darling, president and CEO of the National Business Group on Health, a Washington, D.C.-based not-for-profit organization of mostly large employers. "Employers need to make dramatic statements to get attention, and requiring an active enrollment can help as well."
Darling believes statements such as, "costs are going up" or "you will lose coverage if you don't enroll" are ways to gain attention, and making the communications as simple as possible is essential.
"Information always needs to be sent home to the spouse, and with online communications, never underestimate a person's impatience with technology—you need to have as few clicks as possible or you lose them," she says.
While employees may not spend adequate time learning about their benefits, they say those benefits are an essential part of their job. According to the 2011 Mercer Workplace Survey released in October, nearly 80 percent of employees say their benefits are one of the reasons they work where they do, and 76 percent say that benefits make them feel appreciated by their company.
"Health benefits are critical for employees as part their overall work experience," says Suzanne Nolan, partner and director of marketing and communications for New York City-based Mercer, a global consulting firm. "Our survey showed that 91 percent of respondents said that getting health benefits through work is just as important as getting a salary."
Noting that a basic truth of human behavior is the need to understand before taking action, Nolan recommends simple communications written in "plain" English, and breaking information down into easily digested bites.
"Clients are using email and text messaging to send out short, targeted messages, and even providing QR codes that allow employees to view enrollment guides or other information on their smartphones," Nolan says.
Many experts agree that consistency in communications is also essential, and is an area where many companies fall short.
"Whether communications are specific to benefits or company strategy, employers make the mistake of communicating once around the time of the triggering event," says Patrick Carragher, director of benefits for CheckPoint HR, an Edison, New Jersey, provider of Web-based human resource management systems for small to midsize companies. "You want to communicate the same message to employees often, survey them after open enrollment, and then circle back to increase education on the areas they still don't understand."
Carragher recommends using employee meetings, combined with regular emails and other technology-driven communications, to repeat the message to employees.
"Technology is accessible to most employers now. The more you can put your strategy on autopilot, the better off you are," he says.
"The average employee skims their materials, fills out the form, and is done with enrollment in 15 minutes," says Randy Hart, senior vice president at CBIZ Benefits & Insurance Services Inc. in Columbia, Maryland. "That's crazy, because they can easily spend $2,000 or more on a benefits package, and a decision of that magnitude requires more than 15 minutes. We have to do a better job of educating employees."
Hart recommends planning communications six months ahead of enrollment, or right after open enrollment ends. He says it's a great time to assess what worked and what didn't.
"If you really want your employees to understand their benefits, they need to be touched at least once a month, such as a deep dive into wellness or into pharmacy benefits," he advises. "You have to give an employee a benefit fact 19 times before they understand and accept it, so it's easy to fill up a calendar for the year."
Hart advises against 36-page enrollment guides employees won't read.
"Be brief and to the point, highlight key messages, and recognize that your employees find this information confusing," he says. "Point them toward more information, if they want it, via an online portal, a printed summary plan description or through a call center."