Should You Change Benefits Administrator During Uncertain Times?
With so much changing so quickly this year, companies have had to pivot to new ways of doing business and serving customers: optimizing digital solutions and embracing a remote workplace. What about your benefits administrator? Are they helping you to be agile and nimble as you adapt? If you’ve had issues with your current vendor in the past, the stresses of the COVID-19 pandemic may have thrown the weak spots into the spotlight. To help decide whether it’s time for a change in strategy, here are three important questions to ask.
1. Does your current benefits administrator provide real, proactive solutions to containing costs?
There are many employee benefit administration solutions available in the marketplace that do an adequate job. But if you’re looking to get the most out of your HR spend, you need to ask how your current provider will help manage the variability impacting your organization during the pandemic.
There are three ways to deal with benefit cost: ignore them, manage to baseline, or make fundamental changes that will improve outcomes and materially reduce costs. Many companies are cutting back on planned spend for the next one to three years. As you consider the ways in which your benefits budget will shift in 2021, given projected cost increases and uncertainty around the impact of COVID-19, you can take steps to minimize the disruptiveness of your cost management efforts.
The average total health benefit cost per employee surpassed $13,000 in the United States in 2019, and medical inflation typically outpaces regular inflation. This coming year will be anything but typical. Your workforce may be experiencing increased or different health and well-being needs due to the pandemic. Your benefits administrator should be helping you forecast the cost impact for your organization and your plan members – and suggesting ways to manage it.
2. How well does your current benefits administrator handle employee engagement in a time of high uncertainty?
You should be seeing increased levels of engagement between your employees and your benefits administrator. Your provider should be offering online guidance tools and call center support that helps employees reach the best decisions for them and their families. Communications should demonstrate the value of plans, promote appropriate utilization, and support education and enrollment in voluntary and other value-added benefit programs.
Well-managed benefit plans mitigate business and people risks, like COVID-19, as well as business disruption, rising costs, and regulatory penalties. Look for a strategic partner that manages risks, engages your employees, and delivers proven results.