Employers Investing More in Benefits

Health and wellness are integral to employee performance, which helps explain why employers are investing more in their employee benefit offerings.

In June of 2018, the average cost of benefits rose by 2.9%, while wage costs rose by 2.7%, according to data released by the Bureau of Labor Statistics. Also on the rise is paid leave, which has seen a 4% cost per employee increase since 2017. This includes paid parental leave, which allows time off for a birth, adoption or foster placement of a new child.

What’s Hot and What’s Not

The new year is a good time to look at the benefits larger companies are using to attract and retain good people. According to their 2017 Employee Benefits report, the Society for Human Resource Management tells us that HSAs, wholesale generic drug programs for injectable drugs, standing desks and genetic testing for chronic diseases are becoming popular. The report shows that 55% of businesses allow those with high deductible health plans to put part of their pay into an HSA tax free. This is up from 42% just a few years ago. 36% of employers now also contribute to workers’ HSAs. The percentage of employers covering genetic testing rose from 12% to 18% in just one year.

“Not so much” would describe dwindling interest in medical FSAs, long-term care insurance, mental health coverage and use of personal or life coaching. In other trends, daily casual dress has become the norm at 44% of surveyed companies and nearly 60% of companies now allow telecommuting.

Three Reasons You Should Consider One-On-One Benefits Communication

The article below was published on February 29, 2016 by the International Foundation of Employee Benefits, written by Brenda Hofmann.

In a new International Foundation Benefits Communication survey, only 19% of employers reported their employees have a high level understanding of their benefits. When asked why this is, employers overwhelmingly said their employees do not read the information they provide or they don’t understand it. If your organization has made benefits communication a priority, consider the advantages that one-on-one communication can provide.

Here are three reasons to consider one-on-one benefits communication:

1. Break the Benefits Lingo 
No doubt you’re fluent in Employee Benefits-ese (a complex language with perhaps the most impressive array of acronyms I’ve ever seen), but your employees aren’t. Taking the time to sit down with them one-on-one allows you to answer their questions in plain English—not the legalese of your employee handbook.
2. Improve Job Satisfaction
Employee benefits can play a huge rule in employee satisfaction. A MetLife survey found that employees who are very satisfied with their benefits are almost four times more likely to be very satisfied with their jobs! Educate your workers about the employee benefits available to them, and they’ll feel more confident in their selections and understand the valuable role they play in their total compensation package.
3. Increase Health Literacy
When it comes to your health care plan and making wise health care decisions, your employees are sure to have questions. ACA has only added to the confusion, with half of employers reporting an increase in ACA questions. Remind your employees of the benefits you offer to help them live a healthier lifestyle, and take the time to answer their specific questions about your plan options.

If you’re considering one-on-one benefits communication at your organization, identify the specific benefits you’d like to increase awareness of and ensure your staff is prepared to answer questions.

Health care benefits can be especially confusing—More Americans are uncomfortable navigating their health care benefits than buying a home. Convenient training options like the new Certificate in Health Plan Navigation can provide comprehensive training for your benefits team and the information they need to support plan participants in making the best health care choices.

You work hard to offer your employees a comprehensive benefit package—Don’t let your benefits remain misunderstood!

Benefits Communication Growing in Importance and Difficulty

This article was published on February 25, 2016 by the International Foundation of Employee Benefits, written by Neil Mrkvicka.

Half of all organizations responding to the Benefits Communication Survey say the number of participant questions they receive regarding benefits has increased in the past two years. Adding to the frustration, organizations identify their top challenge with benefits communication as participants not opening/reading materials. Despite challenges, benefits communication remains a high priority for most respondents.

A total of 341 organizations of a variety of sizes, industries/jurisdictions and regions across the United States and Canada participated in the survey. Key findings include:

What Is the Current State of Benefits Communication?

Nearly two in five surveyed organizations (38%) have budgets specifically devoted to benefits communication, and one-quarter of these organizations (25%) likely will increase their budgets next year. A few organizations shared the size of their benefits communications budgets, which ranged from 3% to 10% of the total benefits budget.

Organizations are more likely to handle benefits communication in-house than to outsource, and more than one-third (35%) have staff specifically dedicated to benefits communications. Organizations are more likely to outsource via consultants, administrators and vendors (31%) compared with attorneys (6%). Large organizations are more likely than small organizations to have budgets and staff specifically dedicated to benefits communication.

The most common benefits communication topics are:

• Retirement benefits education (74%)
• Health care benefits literacy (74%)
• Wellness and mental health (72%)

The most frequently used benefits communications channels include:

• Printed mail to homes (89%)
• E-mail (73%)
• Print distributed on site (69%)
• Internal websites (66%)
• External websites (58%)
• Videos (29%)
• Social media (23%)
• Texts (10%)
• Robocalls (9%)
• Games (7%)

Two-thirds of all organizations (67%) reach out to retirees with benefits communication, 53% engage spouses/dependents and 52% personalize communication materials. The most common benefits communications strategies organizations use are simplifying complicated content (85%), year-round communication (73%), reaching out to retirees with benefits communication (67%), leveraging word of mouth (63%), engaging spouses/dependents (53%) and personalizing communication materials (52%). Less than half of all organizations customize communication benefits to multiple generations (49.6%), measure the effectiveness of communications (43%), communicate by life stage (41%) or communicate in multiple languages (31%).

What Are the Goals and Challenges?

Survey findings reveal that 65% of organizations regard benefits communication as a high priority (28% very high and 36% somewhat high). However, the amount of time spent on various benefits communication efforts doesn’t always match up with organizations’ priorities. For example, 89% of organizations report helping participants understand and use their benefits as a top goal, but only 70% say that effort occupies most of their time. Fifty-two percent cite getting individuals to understand the value of benefits as a top goal, but 48% say it takes most of their time. Helping participants make smarter personal health and/or finance decisions is the third most cited goal (49%), with 30% saying it occupies most of their time. Data show how reactively responding to participant questions (57%) seems to be stealing time from organizations’ more proactive benefits communication goals.

Each of the top challenges with benefits communication is centered on participants: Participants do not open/read materials (80%), don’t understand materials (49%) and do not perceive value in their benefits (31%). (Each is cited far more frequently than internal challenges such as benefits staff time, resources or expertise.) Large organizations are more likely to say participants not opening/reading communication materials is a top challenge. U.S. organizations are far more likely to view complying with mandated benefits communication as a top goal, challenge and consumer of time, compared with Canadian organizations.

Few organizations believe their participants have a very high (3%) or somewhat high (16%) level of benefits understanding. Half (49%) say the number of participant questions regarding benefits has increased in the past two years, compared with just 7% reporting a decrease in questions. U.S. organizations are more likely to say the number of participant benefit questions has increased in the last two years compared with those from Canada. Some of the most common benefits topics about which organizations receive participant questions are the Affordable Care Act, health reimbursement arrangements and health savings accounts, plan design changes, accessing retirement funds and health care eligibility, coverage and costs.

The International Foundation deployed Benefits Communication Survey in December 2015 to member organizations across the U.S. and Canada. For a more in-depth analysis and data on which communication approaches are working the best check out the full results here.

Promoting Retirement Saving? Accentuate the Positive

This article is from the International Foundation of Employee Benefit Plans on August 5, 2016 and was written by Pat Bonner, Ph.D., CEBS.

Rarely does a day pass when there isn’t a news headline decrying how few people are saving for retirement, and among those who are saving, most aren’t saving enough. With all the warnings of a retirement crisis and people facing poverty in what are supposed to be our “golden years,” you would think people would be stepping up their efforts to get ready for life after work. Why aren’t people making changes in how much they spend and save?

It turns out behavioral economists have an explanation—and a song from way back in the 1940s provides good advice on how to address the problem. I suspect that somewhere in the back of your brain is a fun little song from Johnny Mercer titled “Accentuate the Positive,” sung by Bing Crosby and the Andrew Sisters.
From behavioral economics we have learned that, contrary to what many people believe, facts and figures on bad behaviors are rarely helpful. Consider this headline:

“One in three workers has saved nothing for retirement.”

Persons who see this headline might think, “A lot of other people like me aren’t saving for retirement, so I don’t have to do anything either.” Or, perhaps, they conclude, “I’m just like everyone else and can’t afford to save money for my retirement.”When people are faced with a choice, they tend to do what most other people are doing. This is where the first three lines of the song provide such good advice for those of us in the benefits field:

You’ve got to accentuate the positive.
Eliminate the negative.
Latch on to the affirmative.

In other words, emphasize what co-workers are doing right:

“80% of ABC employees contributed to their retirement plan last year.”
“Nine of every ten new hires say ‘yes’ to saving 15% of their pay for retirement.”

The more similar the people described in a message are to those targeted (e.g., new hires, co-workers in the same building), the more likely those targeted will copy the positive behavior.While this example focuses on saving for retirement, emphasizing a desired behavior can work when trying to get people to take a variety of actions in the workplace—for example, taking advantage of a health reimbursement arrangement, participating in a fitness program or signing up for a new training program.

Four Ways to Make Sure EOBs Do Explain

The below article was posted by the International Foundation of Employee Benefit Plans on June 22, 2016 and was written by Chris Vogel, CEBS.

Have you ever tried to make sense of health care bills after a serious illness? Did you fantasize about marching into your insurance company president’s office, handing him or her a box full of EOBs and demanding a real explanation of your benefits?

Jim Bracchitta, CEBS, leads off his communications article in the July issue of Benefits Magazine with a dreams-come-true anecdote involving award-winning journalist and author Stephen Brill. Brill had written extensively about the health care system for Time magazine, the New York Times and other publications. After having open-heart surgery, he figured he’d be able make sense of the EOBs that flooded in. But Brill was no more successful than most people in figuring out the bills and claims payments.

Unlike most people, he had access to high-power insurance executives and soon found himself interviewing the president and CEO of his own insurance company. At the end of the interview, Brill handed one of his EOBs to the executive and asked him what it meant. Of course, the executive couldn’t figure it out, either. And his excuse for the indecipherable EOB was the same excuse some benefits communicators might use: State regulations dictate what needed to be said.

But an EOB is a piece of benefit communication. And, as is true of all communication pieces sent out by a benefit fund office, if the person who receives it doesn’t understand it, it has failed to communicate. The fund office may have to make multiple attempts to try to get the information across.

Bracchitta, an actor and a labor trustee for the Screen Actors Guild‒Producers Pension and Health Plans, writes in “Getting It Right the First Time—4 Tools for Evaluating Benefit Communications” that all communications should strive for the following:

1. Simplicity
2. Credibility
3. Transparency
4. Relevance

That means avoiding legalese and “benefitese” most participants won’t get. Participants need to be able to trust what comes from the benefit office and believe they are hearing the whole truth, even if it’s hard to hear. Relevance can be challenging, Bracchitta points out, but finding creative ways to get the right information to people when they most need it is worth the effort.

Unfortunately, the most important communications are the ones, like EOBs, that are highly regulated. But being simple, honest, open and relevant in all communications will make it far more likely people will understand, pay attention—and appreciate their benefits.

Retirement Planning Testimonials Beat Eye-Popping Data

The article below was published on September 29, 2016 by the International Foundation of Employee Benefit Plans, written by Pat Bonner, Ph.D., CEBS.

One of the challenges of being in the benefits field is persuading people to take action. We want them to participate in an annual health risk assessment, exercise, get their children vaccinated, save for retirement . . . the list goes on and on.

Watching the political conventions this summer reminded me of an important strategy when trying to persuade others to take action, not only in the political arena, but also regarding their benefits.

During the conventions, did you notice the reaction the crowd gave little-known people who told personal stories about their lives? People got to their feet. They cheered. They cried. Crowd reaction to these individuals and their testimonials frequently trumped the reaction to other speakers—even well-known politicians—sharing cold, hard facts.

Stories—especially when they are shared by the persons who are part of the story—are a powerful communication tool that’s typically underutilized when it comes to benefits. Stories are effective because they stick in our brains—statistics don’t.

Experts tell us our ancestors didn’t have access to huge data sets; they learned from examples. Our minds aren’t primed to heed the advice embedded in numbers. Stories are persuasive because we tend to imagine ourselves in other people’s shoes.

Download this new information sheet for tips on how testimonials and other strategies can help your organization boost the retirement security of your workers and plan participants: Ten Ways Behavioral Economics Can Boost Retirement Security.

Tap Into Data for Tailored Benefit Communication

The below article was posted by the International Foundation of Employee Benefit Plans on October 27, 2016 and was written by Kathy Bergstrom, CEBS.

Tailoring pension and benefits messages by age or generation is a good first step toward helping plan members make better decisions. But that may not go far enough. “An evolution is coming to more personalized retirement and benefit plan communications,” said Michelle Oram, CEBS, director of product development at Manulife in Waterloo, Ontario. Oram made the remarks during her presentation “Financial Education—Let’s Get Personal” at the 35th Annual ISCEBS Employee Benefits Symposium in September in Baltimore, Maryland.

“Now we segment communications based on age or generation. It’s a step in the right direction, but painting everyone with four little brushes still generalizes,” she said. The pitfall is that messages are based on assumptions rather than behavioral data. “Employee needs are more about personal circumstances than age.”

Oram gave an example of two 55-year-olds who, even though they’re the same age, have different life situations and financial priorities.

Meet Dave. He is 55, is married, has grown children and thinks about retirement a lot.

Dave’s financial priorities: maintaining his lifestyle in retirement, saving for retirement and saving for his family’s future.

What Dave needs: retirement lifestyle coaching, retirement income projections, retirement planning advice and estate planning support.

Key message for Dave: Deposit his regular bonus into his RRSP.

Meet Marilyn. Also 55, she is divorced, has younger dependent children and is not ready to retire.

Marilyn’s financial priorities: paying for her kids’ education, saving for retirement and reducing debt.

What Marilyn needs: retirement income projections, tips to get on track and a financial wellness program that includes debt management.

Key message for Marilyn: Increase her regular contribution to her retirement plan.

But how does a plan sponsor figure this out without invading someone’s privacy? Data, Oram said, and plan sponsors and administrators already have a lot of it.

They have basic demographic information such as the age and gender of their employees. They also have information on life events from plan enrollment such as when someone gets married or divorced or has a child.

They have employment data such as job title, salary and promotions, and they have behavioral data from retirement plans such as investment selections and whether employees maximize the employer match.

With that data in hand, plans should identify key messages and actions. For example, they can look at who doesn’t take full advantage of the match and create a personalized message motivating them to up their contributions.

They can look at who has deposited bonuses in the past and craft an e-mail encouraging those employees to do so again.

Messages must be personal, however, to catch employees’ attention, she said.

Strategies that work include e-mails with a meaningful sender name and subject line and with a link to a personalized video or URL outlining the impact the desired behaviour will have on the employee’s retirement plan.

“Benefits communications are competing with a lot of personalized messages your employees see every day,” Oram said.

How to Get Employees to Use Their Preventive Care

The article below was published on July 21, 2016 by the International Foundation of Employee Benefit Plans, written by Brenda Hofmann.

Preventive care is vital to keep your employees healthy. The more employees take advantage of available preventive care, the more cost-effective their care becomes. They stay healthy, you save on health care costs—It’s a win-win for employees and employers.

You know that the Affordable Care Act (ACA) requires that health plans cover recommended preventive services at no cost to the individual, but do your employees? If you’re not already doing so, consider communicating to your workforce the free preventive care benefits that are available to them.

You may want to adjust the language to best fit your plan or workforce, but here are some samples of communication to get you started:

Take Advantage of Free Preventive Care

Who: You! Men, women and children are all covered.

What: Depending on your age, you may have access to—at no cost to you—preventive services such as:

• Blood pressure, diabetes and cholesterol tests
• Many cancer screenings, including mammograms and colonoscopies
• Counseling on topics such as quitting smoking, losing weight, eating healthfully, treating depression and reducing alcohol use
• Regular well-baby and well-child visits, from birth to age 21
• Routine vaccinations against diseases such as measles, polio and meningitis
• Counseling, screening and vaccines to ensure healthy pregnancies

See the full list at Healthcare.gov.

When: Now. These preventive services are already covered under our plan.

Where: Preventive services are free when delivered by an in-network doctor.

Why: Preventive care screening can detect disease in the early stages when it is most treatable. Following preventive care guidelines, along with the advice of your doctor, can help you stay healthy.

How: Know what’s considered preventive care and review the guidelines. For example, although a colonoscopy is a preventive care screening, it’s only covered for people aged 50 or older. Additionally, colonoscopies that are done to evaluate specific problems are usually classified as diagnostic procedures (not screenings) and are not covered.

Avoid unexpected costs by clearly stating when you make your appointment that your visit is for a covered preventive care service. For example, if you’re making your well-woman visit on the phone, say “I’m making an appointment for my free preventive care well-woman visit.”

Also, medical complaints aren’t preventive. If you discuss other issues with your doctor, the visit is no longer preventive and you’ll be charged a fee. For example, if during your well-woman visit, your doctor does blood work for thyroid problems you are having, these additional services won’t be covered under free preventive care. Don’t hesitate to ask your doctor whether screenings he or she recommends will cost you.