Digital benefits administration is critical to any modern compensation package. We discuss how this space is witnessing a paradigm shift, in-line with complex, on-ground realities.
2018 was an important year for digital benefits administration, several new tools and technologies saw rapid adoption across organizations. 2019 will continue to witness changes and extensions to this landscape, making benefits administration easier and accessible. Kim Tabac, Chief People Officer at LeagueOpens a new window , a digital employee health benefits platform, believes digital convenience will emerge as a key theme for benefits administration in 2019. She says, “Digital convenience will be a key trend as seamless functionalities will be sought after to make benefits administration easier for both employers and employees. This means increasing access to decision support tools to help employees make selections that best fit their health needs or enhancing mobile capabilities geared toward consumers. Additionally, the consolidation of mobile functionalities and integration of features into one central location streamlines the administration process, making it more efficient for employers to manage and easier for employees to access everything they need. Keeping simplicity in mind when developing new products or features will be vital to stay abreast of the competition.†Â
Here are our top trends for digital benefits administration we’re looking forward to, in the new year:
Also read: 5 Questions HR should ask about Benefits softwareOpens a new window
Benefits Dispensation and Management Will be Personalized
For millennials, and now Gen Z employees, personalization is a key value driver. This will obviously impact HR functions and companies will enhance and expand their digital benefits administration capabilities in-line with both internal (decision makers, employees) and external (investors, regulators) stakeholder expectations.
“The labor market is highly competitive, with an unemployment rate of 3.7 percent, and benefits are a key factor employee look for when evaluating potential employers. More than 50 percentOpens a new window of employees said they have left jobs after hearing the siren calls of better benefits elsewhere while 60 percent note that they would take a job with a lower salary for better benefits. People want to work for a company that will support their personal goals, helping them to build a successful career and a healthy, balanced life. Being smart about the benefits you offer — from professional development to health spending accounts, generous parental leave and infertility treatment — is absolutely a key competitive differentiator.
“Top companies are offering extremely generous, personalized benefits packages to attract and retain their top talent. It can feel intimidating for smaller companies to compete, but it doesn’t have to be a money pit. Companies can meet employee demands and keep costs in check by offering personalized packages. Providing choice encourages employees to use their benefits and allows for a greater return on the employer investment. According to League’s 2018 HR Blindspot ReportOpens a new window , 91 percent of employees believe that companies should offer customized compensation packages. By providing creative, personalized packages, companies can offer smarter benefits that truly satisfy and support employees and their unique needs,†says Tabac.
What this means is, benefits administration will be fully personalized, leveraging technology to target incoming candidates as well as existing employees, transforming their journey within the company.
Rising Healthcare Costs will be Addressed by Digital Benefits Administration Strategies
The increase in healthcare costs is a chronic problem for employees across businesses and industries. While a single standalone solution isn’t yet available to address this issue, companies will utilize technology to address this scenario.
“Benefits administration is a huge expense for the HR function managing it in-house, as benefits inquiries make up over 80 percent of all texts/emails/calls to HR operations teams. By outsourcing this administrative work, HR is freed up to provide higher value support to employees with fewer resources. Often benefits inquiries and the ability to provide employees with exceptional support with the administration of their benefits will color the employees’ overall experience with their benefits (i.e. can’t find a form, tedious process=I have terrible benefits),†says Tabac.
In 2019, employers will leverage cutting-edge tools and services to offer data-centered plans which are cost-optimized. Further, intelligent communication strategies will help to expand wellness plans, monitor performance, and drive behavioral change, so that any benefits program is far more result-oriented.
Also read: Are You Ready for the Digital Transformation of Employee Healthcare?Opens a new window
Mobile Experiences Will Become the Norm
As the use of smartphones continues to increase, digital benefits administration providers will look towards these devices for a more effective and efficient delivery mechanism.
For instance, a mobile digital benefits administration app will be able to scan barcodes in order to assess an expense’s eligibility, while also monitoring account activity, receiving notifications, uploading documents, and extracting data from an employee’s Health Savings Account (HSA).
Employee Benefits Engagement will Become a Top Priority
Employee benefits are one of the most important and influential factors affecting job satisfaction. 84 percentOpens a new window of employees that are highly satisfied with their benefits also say they are highly satisfied with their job. Given this reality, HR leaders will focus on fostering and improving benefits engagement in 2019.
Tabac says manual administrative processes discourage employees from engaging with their benefits meaningfully. She says, “Arduous and administrative processes are the number one reason why employees do not use their benefits. In the digital world where employees have 24/7 access to everything they need in an instant, forcing them to print a form, scan it back or (even worse) mail it is enough to have any busy modern employee forego the process altogether.
“The best way employers can get their employees to engage with their benefits is to remove any confusion and make sure employees understand what they’re being offered via a consumerized experience. Just 19 percentOpens a new window of employees have a high understanding of their benefits, which is astounding when you consider 10 percent of an employee’s income on average is spent on premiums and out of pocket deductibles. Additionally, only 34 percentOpens a new window of employees pay attention to all of the materials they receive about their company benefits, which are typically dense and not comprehensive. Employers need to do a better job not only communicating their benefit offerings but also simplifying the enrollment process to alleviate confusion and decision fatigue — this can be done through technology, counseling or other educational avenues. By making it clear what benefits are available and how employees can make the most of them, employers can have a meaningful impact driving engagement.†Â
The integration of HRIS frameworks with third-party digital benefits administration providers will allow the seamless exchange of data, transforming renewal plans, and thus boosting engagement. These integrations and digitization movements will eradicate manual intervention and paperwork, ensuring the entire process is faster and more streamlined.
“Making claims also needs to be a pain-free experience if we expect employees to leverage the benefits that they are provided. Health benefits are among a company’s largest expenses, and yet when the claims process is arduous, manual, and paper-based, employees are often choosing not to make claims, or even worse — not to leverage their health benefits at all,†adds Tabac. Â
Also read: 4 Ways Technology can Help Improve Open Enrollment EngagementOpens a new window
Financial Wellness Will Become Imperative to any Benefits Package
The on-ground situation for employees today is largely complex. From out-of-pocket healthcare to student loan debt, and other financial challenges, employees are regularly held back from achieving their personal milestones, like purchasing property, or more importantly, securing their financial future.
“Studies show that when employees experience a lot of financial stress, their physical health and productivity suffers and they’re not able to retire on time — outcomes that lead to higher health care and payroll costs for their employer. If employers can relieve some of that financial stress with better education and support, they can both improve the quality of life of their employees…and reduce their costs across the board,†says Opens a new window Helen Calvin, CRO at SaaS-based employee communications provider Jellyvision.
This environment makes financial wellness an essential consideration for enlightened employers. Instead of offering a cluster of benefits programs, 2019 will witness targeted and holistic financial wellness initiatives, disseminated via digital benefits administration platforms to strengthen and fortify employees’ future, as well as their current investments.
Also read: 5 Tips for Great Financial Wellness from Opens a new window Digital Benefits Administration Opens a new window Leader, PayActivOpens a new window
In Closure
Clearly, the ambit of digital benefits administration is rapidly changing. The conventional approach of offering a predetermined set of benefits and other compensation options will be replaced by analytics-driven personalization and an acute understanding of contemporary challenges. Modern, growth-focused companies will offer employees a benefits blueprint informed by state-of-the-art technology, which is more human and in-sync with today’s most pressing considerations.
What are your thoughts on how digital benefits administration will change in 2019? Leave a comment below and join the discussion.