Managing Employee Benefits
The following are some tips for controlling costs, maximizing value.
(Editor’s note: The following report was prepared by Ameritas Group Dental and Eye Care exclusively for The NATIONAL PROVISIONER as a service to its readers. Expect to see more NP reports like this throughout the year.)
For seven consecutive years, businesses throughout the country have watched employee benefit costs skyrocket. Despite efforts to slow down premium increases, employers feel benefits are out of their control. Many are also frustrated that they can’t offer a variety of quality plans to their employees.
The solution is for businesses to change their approach to employee benefits and develop plans that best match employee needs — instead of waiting to react to proposals and premiums at renewal time.
Consider the following eight strategies to take control of your benefits:
Develop a 12-month approach to benefits. Many businesses think about employee benefits several months before renewal time. While this approach worked in the past, today’s benefits are fairly complex and require advance planning to find the right combination.
Interview key stakeholders about benefit options. Gather feedback on benefits from non-biased individuals in the organization, especially if employees work under a union contract. Listen to their suggestions and ask for help in prioritizing options. Avoid making promises, in case you can’t fulfill them.
Clarify the reasons for offering benefits. It’s important to clearly understand why you provide employee benefits. For example, are they required by union contract or necessary to recruit and retain quality employees? The answers will indicate which options best match those considerations.
Identify critical benefit plan features. Review current plan utilization trends and employee demographics. Look for large segments of workers with specific needs, such as individuals with young families, certain types of diseases or health conditions, or those nearing retirement age. Develop a list of critical features for each benefit option.
Interview insurance carriers and look for strategic partners. Carriers have different areas of expertise and operational philosophies. Ask carriers for specific details on their experiences with plans and businesses of similar size and scope as yours, and for a history of premium increases. Identify carriers that want to partner with you in providing the best benefit options.
Define benefit plan needs for your broker. To help the broker shop for the right mix of benefits, explain your benefit goals, insurance carrier preferences, and plan design requirements. (Note: If you wait until renewal time to identify carrier preferences, you may have less control over benefit options. Brokers may not have sufficient time to find the best carriers with the right plan design and premium.)
Evaluate plans to find the best fit. Carefully review the plan designs for the right match. Remember, you don’t have to take the first proposal. If you find a carrier and plan you like, negotiate for specific features.
Communicate new benefits to employees, especially if there are changes from current plans. When reviewing utilization trends and employee demographics, you may find unused features, which could be exchanged for more pertinent services. Clearly communicate the reasons for these changes. Otherwise employees may think they’re receiving a lower-quality plan.
After new benefits are introduced, track employee feedback. Regularly ask employees about their experiences with the plans and insurance carriers, and use this information to identify future benefit needs. NP
Submitted by Karen Gustin, LLIF, vice president—group marketing and managed care for Ameritas Group Dental and Eye Care in Lincoln, NE. Ameritas Group regularly assists businesses enhancing their knowledge of dental and eye care products and services. For assistance in understanding plans or comparing coverage options, contact the Ameritas Group Marketing Department at (800)776-9446.