Open enrollment season is here for many small businesses and it can be a whirlwind of frustration and confusion — and a bevy of open enrollment mistakes — for both employees and employers. It’s another “to-do” list add-on for employers, and employees are bombarded with information requiring them to make important decisions. However, shockingly, according to Small Business Trends, “people spend eight times more effort deciding what television to buy and 16 times more on shopping for a computer than on choosing health insurance.”
As a result, more than half of employees report that these open enrollment mistakes cost them approximately $750 annually, reports CBS News. Without examining the plan, employees are unaware of changes in health plans year-to-year — such as changing networks, changing co-payments or changing prescription drug coverage.
What can employers do to help avoid these mistakes?
Although open enrollment adds to your to-do list, it’s critical to communicate frequently to employees about benefits offerings. This includes any changes to the employer health plan, such as increased costs and network changes. Simply delivering plan booklets to employees alone is ineffective as such material will not always be read. Make sure your message is easy to understand and allows for questions.
For example, as a small business owner, I had an employee who I encouraged to review prescription coverage changes during the 2017 open enrollment season. She didn’t, as she assumed that all plans under this particular carrier were the same. As it turned out, a prescription for her disabled husband was not covered, financially impacting her family significantly.
Bring in a Third Party
Bringing in a third party, such as a broker or a financial consultant, to discuss the benefits of the health insurance option can help stress the importance of the decisions your employees make. According to Small Business Trends, these professionals can provide information and answer questions about how planning for your employees’ health can impact long-term financial goals.
A third party can also assist with financial wellness planning in the health plan arena. For example, high deductible health plans (HDHP) paired with health savings accounts (HSA) are becoming more popular, according to America’s Health Insurance Plans (AHIP). However, you should spend more time educating employees on how these plans work, as they can be confusing. Education of health care options is critical so employees can make more informed decisions for themselves and their families and avoid costly mistakes.
Employees need to spend quality time making health care decisions. With changes occurring at a rapid pace, year-to-year, assumptions about continued benefits cannot stand. You should help your employees avoid mistakes by encouraging better decision-making through education, access to third-party professionals, and continued communication about benefits offerings and changes — and not just at open enrollment. According to Glassdoor, 79 percent of employees prefer new or additional benefits to a pay raise. Your additional effort put into benefits, year-round, is worth it.
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