Why a strong communication strategy is essential for making sure your employees get the most return from their voluntary benefits policies
Key Takeaways:
- Employees don’t always understand how voluntary benefits programs work
- A strategic communication plan is essential to explain the value of benefits programs in general and specifically for participation rates and claims filings for voluntary benefits
- Most companies inadequately position the importance of supplemental coverage, and that financially exposes employees in the long run
- A strong benefits communication strategy can increase participation and make your benefits strategy more effective at protecting and retaining employees
Supplemental benefits programs like Critical Illness, Hospital Indemnity, and Accident coverage can be an essential part of employer offerings to attract and retain talent. However, it’s necessary to have a deliberate communication strategy for employees to understand the real value of these programs.
Why good communication matters
Communicating the purpose of voluntary benefits programs is key to increasing enrollment. Most employees don’t understand why they need Accident, Critical Illness, and Hospital Indemnity coverage because the benefits may not be clear or seem unlikely to affect them.
It’s important to note that voluntary insurance benefits like dental and vision often have very low limits of protection and essentially represent discount plans. Conversely, policies that supplement the medical program provide a lot of real value:
- Accident: Supplemental coverage for accidents with benefits that can be used to pay any out-of-pocket expenses your employee needs help with
- Critical Illness: Provides financial benefits to help with expenses and lost wages around serious medical conditions like heart attacks, strokes, and cancer
- Hospital Indemnity: Offers a fixed amount of additional hospital coverage that can help pay expenses like your deductible, coinsurance, transportation, medications/equipment, home health care, and even your mortgage or rent
Employers are becoming just as committed to communicating the value and increasing enrollment in these plans as they are with dental and vision coverage. In fact, given the financial protection each offers, it’s a good idea to emphasize these options even more than vision or dental (as we’ll discuss below).
These are some of the most common reasons for limited voluntary benefits plan participation:
- Challenges with education, communication, and enrollment strategy
- Passive enrollment that lacks proactive employee engagement
- Ineffective enrollment communication materials and reach
When you have a good communication strategy, participation generally increases. On the other hand, poor communication results in lower enrollment numbers, especially for less well-known insurance options like Accident, Critical Illness, and Hospital Indemnity coverage.
5 Keys to a successful enrollment communication strategy
Did you know that many employees would rather go to the dentist than choose benefits during open enrollment? Why is that?
Open enrollment can be confusing and frustrating. Employees must make important decisions about things they don’t fully understand. This can lead to anxiety when choosing between different plans and coverage options.
Yet the open-enrollment period is the starting line of your benefits communication strategy. This is especially true when talking about supplemental health benefits. Here are five key elements that should make up your strategy for better benefits communication.
1. Order of communication
If one of your objectives is to increase enrollment in voluntary benefits offerings, the order in which you present these programs matters. Most companies offer medical benefits, followed by dental, vision, and then everything else.
Consider changing the order of communications so that supplemental health benefits come right after medical. Accident, Critical Illness, and Hospital Indemnity insurance plans can genuinely benefit employees by covering out-of-pocket expenses that are not included in most traditional health insurance plans.
The order of communication matters from a psychological aspect, as well. Employees think you’re presenting insurance options in “order of importance.” When you put voluntary plans near the top of the list, employees better understand their impact.
Since employees are already very conscious of deductions from their paycheck for medical, dental/vision, and retirement benefits, that with other voluntary benefit options they may face “enrollment fatigue.” When comparing the relative value of these coverages versus dental and vision, a reshuffle makes sense.
2. Support and explain
It’s crucial to help employees make the best choice for their needs. That requires the proper support. For example, which medical plan did the employee choose? Did they choose a high-deductible plan in exchange for lower premiums? If so, it makes sense to strongly recommend adding supplemental health benefits that will fill the gap and cover extra expenses.
Another strategy is to incentivize voluntary benefits. Employers can pay for a base-level voluntary plan if employees opt for a higher deductible plan. This helps mitigate the fear of having a lot of medical expenses.
3. Use different communication methods
Incorporate different modes of communication. Some people prefer written or printed communication while others learn better from watching videos. Some older employees might not be comfortable with technology, so relying only on emails or apps could quickly become overwhelming. In these cases, sending a mailer home might be a better strategy.
4. Steer people in the right direction
In many cases, making a solid recommendation can help. When employees don’t understand a situation well, they typically will do nothing or whatever the status quo is. But they want advice before they make a choice, so a strong recommendation based upon sound decision support tools and technology makes it more likely that employees will sign up. They won’t be paralyzed by indecision and then face a situation where they’re struggling to pay out-of-pocket medical expenses or high deductibles.
5. Communicate all year long
It’s essential to maintain a communication strategy throughout the year, not just during the open enrollment period.
According to the U.S. Bureau of Labor Statistics, the second biggest expense after wages is benefits for most companies. Employers pay the lion’s share of those costs, yet they don’t remind employees about their high value and significant benefits or how to take advantage of them throughout the year.
For example, average participation in Employee Assistance Programs (EAPs) represents only a small fraction of employees, and surveys show only half of employees even know the employer offers a program. The COVID-19 pandemic brought those percentages up somewhat, especially with employees using more mental health benefits. Otherwise, participation in such benefits remains low.
Companies offer benefits that can truly positively impact employees, but those same employees don’t know those benefits are available. They don’t even remember what benefits they did choose once the chaos of open enrollment ends. Since the open enrollment process can be so painful, they don’t even want to think about it anymore.
Wise employers remind employees about their benefits and promote their value and availability all year long.
It’s never been more important to ensure employee satisfaction. We’re in such a competitive work environment with employees demanding more that voluntary benefits can be a differentiating factor in the hiring process. They can also go a long way to helping with employee retention.
These communication strategies will help contribute to a higher appreciation for the significant amount invested in benefits.
How can we help?
BeneRe assists large employers with Accident, Critical Illness, and Hospital Indemnity coverage. We can also help benefits managers and brokers develop strategic communication plans to ensure employees understand the importance of their benefits and how voluntary programs provide peace of mind in a time of crisis.
Reach out to BeneRe to set up a complimentary financial analysis and see how our unique value proposition can help attract and retain your employees with better coverage at a lower cost.