Open Enrollment’s Financial Impact – You Do Have Control
With the cost of employer-sponsored health care benefits expected to approach $15,000 per employee per year, labor costs, including employee wages, benefits, payroll and other related taxes, can account for as much as 70% of total business costs. While some of these costs are beyond your control, there are many strategies available to manage your organization’s employee benefits costs.
A Streamlined Open Enrollment Process
One such strategy is planning and executing a streamlined open enrollment process. Not only can this help ensure the associated expenses are leveraged efficiently with minimal waste, it can also have a positive impact on your business’ success and employee gratification. In fact, organizations that take a strategic approach to open enrollment are nearly two times more likely to have reported better business performance and more satisfied employees compared with organizations that are not strategic.
A positive open enrollment experience also can increase employee loyalty. Click here to learn how and for additional related statistics.
Positive Health Care Consumerism
Increasingly, employers’ efforts to manage costs are focused on making their employees better health care consumers, for example, by promoting healthy lifestyles and providing them with benefits tools and education. Positive health care consumerism is ultimately tied to plan design, incentives, effective communication, and enabling and supporting healthful behaviors among employees.
Further, employers that invest in a quality health benefit plan with an advanced open enrollment process as a means to help attract and retain high-quality talent receive the added benefit of a positive financial impact via increased job offer acceptances and higher retention rates. This is critically important as we are in one of the most competitive job markets in history.
Answer a few questions to determine if your open enrollment is set up to have a positive or negative financial impact.
Enrollment Communication and Education
Additionally, a less-than-successful open enrollment can have a negative impact on employees’ finances. Health plans and life situations can change significantly each year; therefore, employees may need to adjust their benefits to meet their current needs. However, many are not properly educated on current-year benefits and, as a result, they feel safer sticking with their existing plan. Benefits mistakes can be costly; 55% of employees estimate they waste up to $750 a year because of mistakes they make during open enrollment. That’s a significant portion of a family’s budget wasted. This all points to the overwhelming need for effective pre- and during enrollment communication and education.
Open enrollment can have a substantial impact on your bottom line and your employees’ financial wellbeing. You have the power to determine whether that impact will be positive or negative. The strategies discussed here are an excellent start on the path to an open enrollment that will play a substantial positive role in your organization’s financial results.