For Holly Monroe, open enrollment and an increase in cardiovascular activity came at the same time each year. When she spotted the representatives from her employer’s voluntary insurance plans, she says, she always took to her heels. “I was one of those people who would run from the insurance people,” she freely admits.
Monroe has had a change of heart since then and now says she spends time throughout the year educating employees about how the company’s voluntary benefits can help them. “I was ignorant,” she says. “I didn’t understand how these programs could benefit me.”
You might even call Monroe, who works in human resources at the ’Tween Waters Inn on Captiva Island, Florida, a workplace benefits zealot. She won’t mind; she makes educating employees about the importance of workplace benefits one of her missions in life. “I’ve turned a lot of people around,” she says. “Now that I’m in human resources and understand these things, I educate people. That’s my passion now, because I’ve seen people really benefit from them.”
Rising healthcare costs and concerns over the ways healthcare reform will affect those costs is paralyzing many companies, keeping them from adding to, or even maintaining, their employer-paid benefits. Add to that the increase in cost shifting in the past several years, and the result may be gaps in coverage that are hard for employees to fill and could be catastrophic for them.
Higher Costs, More Decisions
Jay Hutchins is vice president for broker marketing with Colonial Life, the company ’Tween Waters Inn uses. “Nobody really knows what’s going to happen with healthcare reform,” says Hutchins. “Even before the economy slowed down, employers were directing more benefit costs toward their employees. Before, employers would say, ‘Here’s your benefit package. We’re done.’ Now, employees are being required to make decisions on these things, and they’re paying more for them.”
A recent report from Hewitt Associates confirms his comments. It shows that the average annual out-of-pocket costs for employees, not including the employee share of premiums, will reach $2,177 in 2011, up 12.5 percent from 2010 ($1,934). And, says Hutchins, employees are being asked to make many more decisions about their benefits than in the past.
All of this adds up to a perfect time for voluntary benefits, such as insurance policies purchased by individual employees that can guard against loss of income, pay for unexpected medical costs, and protect survivors if the employee dies. Voluntary benefits are purchased at work and paid for through payroll deduction. Voluntary benefits don’t add any direct costs to employers. In fact, they can even save companies money by utilizing the pretax provisions of Internal Revenue Code Section 125.
Adding workplace benefits can be as simple as picking up the phone and contacting one of the providers you’ll find with a Google search. Monroe and Hutchins suggest that you keep these factors at the top of your wish list as you shop:
- Does the insurance company provide one-on-one enrollments, and can they do it more than once? “Employers don’t always want to do one-on-one enrollments, and it is up to them, but we suggest it. We see close to 55 percent participation rates when we do one-on-one benefit counseling. And enrollments should not be a one-time thing,” says Hutchins.
“The company you work with should make commitments for the second, third, fourth, and fifth years to come back and re-enroll. We like to sit down with our clients and put together a business plan about how we are going to work with them. Maybe they want us there every quarter; we can do that,” he explains - Can the company incorporate your existing benefits into their enrollments? Monroe stresses how important this service is to her. “The reps help me with our major health insurance, too. They verify addresses and phone numbers, because sometimes people don’t tell me when these things change. They can accomplish in 2 or 3 days what would take me 2 or 3 weeks.”
- Does the company emphasize employee education? One of the outcomes of any benefits program should be employee appreciation. If employees don’t understand how much the company is paying for their benefits, you’re missing an opportunity to create that appreciation. Hutchins suggests that the voluntary benefits company you choose be able to show each employee the true cost of their benefits package as they enroll them in the voluntary benefits. “We talk to each employee about their core benefits, like the 401(k), disability, life insurance, health benefits. As we do that, we look for any gaps or opportunities to save. Maybe their deductible is very low and they could save money by raising it and filling in the gap with a medical bridge plan.”
The Society for Human Resource Management surveyed human resources professionals, inquiring about the importance and level of employee understanding of their benefits, Hutchins says.
“More than 90 percent said it is important to the business for employees to be educated and really know their benefits package. Yet only 20 percent felt their employees really do. Our goal is to make employees more knowledgeable, for the benefit of the employer and the employees themselves,” he says.
Monroe says that’s exactly what’s happening at ’Tween Waters Inn. “I start about 2 months before Colonial is due to arrive, talking to employees about their benefits. We discuss what they have and what is available to them.”
And while Monroe is an on-site advocate for the voluntary benefits, the major part of the work is done by Colonial representatives.
“It’s part of their regular service to come in and sit down with each employee and go over their complete benefits package with the employees,” she says. That’s how people are transformed from “runners,” like Monroe herself used to be, into people who are more ready for some of life’s complications.
Give People Real-Life Examples
One of the best ways Monroe has found to educate employees about the insurance products available to them is to use real-life examples. “Of course, I don’t use people’s names, but I’ll describe situations. Testimonials are really the best way to understand how all of this works,” she says.
One testimonial in particular she likes to use is her own story. “I’ve had health insurance all of my life and only used it [in a major way] twice. My voluntary plan paid for all my deductibles. You just never know. I didn’t know that I had a bad gallbladder and would have to go to the emergency room! So I’m living proof that when you need it, you need it.”
Another example she talks about is a person who works for the company as a bartender. “A lot of people say they don’t need insurance,” Monroe says. The employee felt that way, too.
“I kind of twisted his arm the year he signed up,” she says. “I said to him, ‘Look, what will happen if you have some kind of an accident?’ He ended up breaking his arm and was out of work. The accident policy paid his salary while he was out. He told me it saved his life; he didn’t know what he and his family would have done. So I tell people these stories, and a lot of times they see how important it can be to them.
“Every year I try to find a different way to word things so our employees can understand how these policies can really help them,” Monroe continues.
“I recommend that HR people learn as much as they can about this, because that’s how you can really help your employees. I get a lot of people coming up and thanking me for educating them. That feels good,” Monroe says.