LOCKTON COMPANIES LLC

It’s no surprise to anyone that the cost of employer-based health insurance keeps going up. Companies are numb to the annual 10 percent increase, so much so that they simply budget for that, and if the number is anything lower it’s considered a win.

 What is a surprise is how little real education is provided to the people that matter most in the equation: employees. Typically, the one-time per year that any education is offered to employees is at open enrollment. And what does that look like? Perhaps a benefits guide, a pithy animated video, or maybe just a few clickable links via benefits admin platform to documents that no one reads.

“HEALTH PLANS THEMSELVES ARE STRUGGLING WITH ADDING NETWORK, PAYING PROVIDERS NOUGH FOR THEM TO BE INTERESTED AND GIVING MEMBERS TIMELY ACCESS”

Open enrollment presentations are pretty much a thing of the past and there’s no real interaction to ask specific questions. At best, a company may offer some type of decision support to help someone pick the plan design and carrier that fits the employee needs.

And in the last few years, the preponderance of engagement point solutions has been unprecedented. So many companies offering solutions to help employees “engage”. One-stop portals on your device to access health plan info, participate in well-being challenges, facilitate telemedicine access and more are now the norm.

Mental health has become a major driver of the new employee engagement. Many point solutions are addressing this space, employers are interested, but access is still a challenge at the provider level. Health plans themselves are struggling with adding network, paying providers enough for them to be interested and giving members timely access. Telemental health apps are on the rise, but their uptake is slow.

With all this, are employees any more engaged? Can these tools contribute to cost savings? The unfortunate answer is only maybe. At the margins, these create more awareness, but do little to take a dent out of employer cost. The other challenge is that there are now so many venture-funded tools and telemedicine apps and mental health solutions available, that the question becomes how many will survive beyond the next 2-3 years. So, the one you pick today, may not be around.

“Employees should be part of the solution and treated as an integral part of the communications solution”

 What’s the solution? It’s not about how we communicate to employees, but what we communicate. I’m advocating that employees should be part of the solution and treated as an integral part of the communications solution. Benefits now cost 30-40 percent of payroll and will dramatically increase in the next 5 years. That $500 monthly health plan premium per employee will be $800 in 5 years at 10 percent compounded annually. Are you ready for that?

 Some recommendations:

• Improve the onboarding process.

o Rather than just give a new hire a benefits guide, actually train them how to use their benefits.

 o Define the complex terms in plain language. There are 5 things an employee needs to know cold: premium (payroll deducted), plan deductible, copay, coinsurance, and annual out-ofpocket maximum.

o Show some examples of how to use the plan. Tell employees to stay out of the ER unless it’s a real emergency. Teach how to engage with a physician when being prescribed an expensive medicine. Show the ease of using the telemedicine app to get quick care.

 o Share how to use a health savings account as a long-term retirement plan. Make this formal, mandatory education.

 o This should be a mandatory training like sexual harassment and should be embedded in learning management systems. Employees should be incented to take the training annually. It’s like doing your annual preventative exam but for the employer. The better trained and aware a workforce is, the more sensitive they will be to costs.

 • Develop a real marketing plan and keep communicating. A company definitely has an external marketing plan, so they should develop a great internal one as well. This will serve to remind employees throughout the year how to use their plan effectively and save money.

• Make employees part of the annual renewal process. Talk about what increase is to be expected and why. Communicate early if there will be an expected change to plan structure, insurance carrier or paycheck deduction. Make benefit planning a real part of the organization strategic plan.

• Make sure this approach is a true partnership between the HR and Finance functions. Both are key stakeholders in the process and bring unique skill sets.

• Share success stories about how incremental changes by everyone has saved the company and how that means that no one pays more next year.

The dream of a flat renewal caused by employees that are engaged participants shouldn’t be a fantasy. It takes a broader vision of human resources and finance functions working alongside a great consultant to find way to make those10 percent increases a thing of the past.