Fall is when leaves change color, football season kicks off, and for many Coloradans, it’s when they pick their upcoming year’s benefits plan.
“One of the things that is absolutely key is to think about how [employers and their] human resources team communicate open enrollment to their employees,” said Vincent Plymell, communications manager for the Colorado Division of Insurance. “Health insurance is something that makes a lot of people anxious for a variety of reasons. It’s not something they’re marinating in, so it’s a lot of jargon, unfamiliar concepts, but it also makes people anxious because it is so critically important to their lives.”
Open enrollment begins next month for employers who follow the traditional January-through-December calendar year.
“It is up to most employers when they have their open enrollment,” Plymell said. “Most do fall into the traditional world having it this time of the year; however, many others do it based on a different schedule for their plan years.”
The Business Journal spoke with benefits experts last week about advice for employers when it comes to open enrollment.
The UCHealth benefits team is planning the coming year’s benefits packages for employees before the current year’s open enrollment wraps up, said Shannon Bryant, the benefits director for UCHealth.
“It usually takes a long time to plan out what [an employer’s] strategies are and how they may change,” she said. “When open enrollment is starting to get planned, on the strategy side, you have to know what is your cost structure, how much can the organization afford and what are the contribution splits — how much will the employer be able to take on versus how much will the employee?”
Prep work is about matching costs with the design of the benefits themselves, Bryant said.
“There are only so many ways you can get around costs with the trends that we are seeing,” she said. “That is kind of the pre-work, which happens well before open enrollment begins.”
Finding the right package
Health care costs keep going up, Bryant said, adding that’s why it becomes extremely important to find the right benefits packages for both the employer and the employees.
UCHealth surveyed employees a couple of years ago, asking if they would rather see the monthly cost of insurance go up or changes to benefit details, such as deductibles and copays, and they responded they wanted as little impact to their paychecks as possible.
“[Employers] need to have all of those discussions with employees beforehand, and then they need to start educating their employee base about what they can expect,” Bryant said.
The health system has about 19,500 benefit-eligible employees, according to Danielle Boehm, benefits manager for UCHealth.
“That size allows us to do some things similar to other large employers with our benefits packages to cut costs,” she said.
However, there are cost-saving measures for smaller businesses as well, said Andrea Baldrica, the senior vice president of employee benefits for HUB International Insurance Service.
“One would be going with a narrow network, and typically, it can be a narrow or high-performance network where you are not sacrificing benefits but instead limiting your employees going to see providers that are giving more value,” she said. “The other is to look at partially self-funding your plan through a health reimbursement arrangement.”
Baldrica said employers also might consider going with high-performance formularies for prescription coverage, which are tools used by purchasers to limit drug coverage based on favorable clinical performance and relative cost.
“Then the last thing we are seeing is people going with higher deductibles or limited office visit plans and then pairing alongside a direct primary care plan,” she said. “It’s eliminating first-dollar coverage for all of your office visits but doing something that allows [employees] to go see a contracted primary care provider.”
Bryant recommends smaller business owners partner with insurance carriers that can support them while trying to navigate the process of selecting benefits packages, or in larger environments, an insurance broker might be able to assist.
“Really using those people and their expertise to really add or use some of those elements in your package,” she said. “It’s also important to have some sort of decision support for employees and clear communication because that is going to help employers be the most successful at the time of open enrollment.”
Communication is key
A couple of years ago, UCHealth switched from passive to active open enrollment, Bryant said.
“We did huge campaign pushes and now the majority of folks just go in the system each year and choose their plan during open enrollment,” she said. “The transition went a lot easier than we expected, and I think that’s because of how we communicated it to our employees.”
In mid-January each year the hospital system’s benefits team begins planning out their benefits package communication for the following year to both employees and leadership.
“We make sure we touch on anybody that is going to be affected by open enrollment, which is our entire benefit’s eligible population,” Boehm said. “With the leaders, it’s making sure they know the reasons behind our decisions and where we are going for the next fiscal year for our benefits plan design.”
The communication plan also ensures employees know when open enrollment begins and ends.
“It’s also about letting [employees] know what resources and materials they have to utilize to make their next year benefits decision,” Boehm said. “We are too large of an organization for our benefits team to be everywhere at once, so we kind of have gotten creative over the years and made sure we have email communications, send a postcard to our employees’ homes, and we have a livestream event where employees can sit at their computers and watch it.”
Additionally, this year, the hospital system is adding a virtual vendor fair for employees.
“They will be able to log onto their computers and chat with our medical, dental and vision vendors,” Boehm said. “They will be able to chat with someone from the benefits team and get their questions answered in that way as well.”
UCHealth also utilizes an Excel tool, which allows employees to enter their personal information and then view and compare plans side-by-side.
“It’s showing what they are going to pay annually for their premiums out of their paycheck,” Boehm said. “Then it shows the estimated out-of-pocket expenses for their medical plan, adding it all together showing them a comparison of which plan might work better for them and their family.”
It’s critical for employers to be “very thoughtful” on how they communicate open enrollment to their employees, Plymell said.
“You probably don’t want to leave it as a simple email with an attachment announcing open enrollment starts on X date and here are some facts or just throw a booklet at them,” he said. “Employers should arrange for some times for people to ask questions, if at all possible, face to face.”
Employers also should communicate any advantages that the health insurance company is bringing to the table in terms of programs, including a nurse line or telemedicine, Plymell said.
“The employer is paying for those and those are things they want to see people use and hopefully will act as a cost-saving measure in the end,” he said. “I think some of the stats that I used to hear is that when people choose their health insurance they only take three to five minutes researching their choices … so the more communication, I think, the better.”
Bryant offered the following advice for employers: Start early, plan accordingly and make sure you and your finance folks are support the same strategy.
“You also need to make sure that you have the best partners out there from a carrier perspective or whatever environment that you are using,” she said. “And as soon as you get that strategy locked in, it’s then focusing your attention on your employees and how to best help them understand and get through the process of choosing their benefits.”