Over half (53%) of large U.S. employers are making changes to their 2011 health plans in order to accommodate the new Patient Protection and Affordable Care Act, according to a survey by the National Business Group on Health.
When changing health plans, benefits communication can help focus on the positive.
Providers face rising health care costs but still must supply the legally required amount of care. To do so, 63% of employers who are changing plan details have decided to raise the percentage that employees contribute to the premium, while 46% aim to raise out-of-pocket maximums. Another 61% will be offering consumer-directed health plans, or CDHPs, which are a proven method of increasing consumer flexibility while cutting costs.
With so many benefits changing, it is important that employees thoroughly understand the developments and the reasons behind them. The efforts that must be undertaken to get an employee to fully understand a CDHP are substantial and probably well telegraphed at this point. If your strategy is to introduce this complex new benefit with a few vendor-provided brochures, you’ll likely end up with the status quo – single digit adoption rates.
Shifting a larger share of the cost to employees will likely be seen as a negative no matter what you do. But, it’s never a good idea to let employees come to their own conclusions about those changes. With effective benefits communication, you can provide context and position plan changes with your employees. Further, you can show them how to better utilize their plans and capture the cost-savings opportunities that are available to them. Investing in benefits communication is perhaps the easiest and most cost-effective way to improve the perception that employees have about their benefits and about you as an employer, even in the wake of negative changes.
Benefits communication used to engage and retain employees as economy improves
Mercer recently announced the results of their Attraction and Retention Survey, covering over 320 employers this year. These are their most valuable findings:
Better economy means higher employee turnover. As the economy and job market continue to improve, 62% of companies think employee turnover will increase as well. When employees have more options, they are less likely to be loyal unless their company puts effort into keeping them.
Companies are expanding again. The economy is picking up and so is hiring. Nearly all companies surveyed are hiring. In fact, only 3% are reducing their workforce. Nearly one-third (27%) of companies are expanding, up from 12% shown in the 2009 Unprecedented Times Survey. This is a clear sign of companies’ confidence in the economy.
Companies are concentrating on engagement to retain employees. Employee engagement has increased in 47% of companies in the last 12-18 months, likely thanks to companies’ specific efforts. Engaged employees are less likely to stray and have higher performance levels, according to a Mercer principal. Retention is as important as expansion, when other employers can lure good talent away.
Benefits communication is the highest contributor to increasing employee engagement. Organizations have increased non-cash rewards as a means of retaining and engaging employees in the past 18 months. The reward most often used was benefits communication, which companies have used 27% more. Even as the economy improves, non-cash rewards serve as an important means of curbing turnover. Non-cash rewards are a good way of communicating confidence and appreciation for employees. It is also much cheaper to implement rewards programs than to hire new replacement employees. If employees don’t understand, value, or even know about these rewards then they won’t merit much. That’s why benefits communication has become such a vital resource for companies to keep employees engaged and loyal.
A new study by UNUM demonstrates the power of effective benefits education. Employers with highly rated benefits education had job satisfaction rates of 88% vs. 45% for those employers with fair or poor benefits education – a difference of 43 points! Employers with effective benefits education programs enjoyed increased employee engagement, loyalty, morale and productivity – ultimately driving up the ROI of significant investments in the benefits themselves.
Benefits education proven effective for increasing employee satisfaction
Here are some highlights from the study:
- “What you say” is as important as “what you do.”When it comes to workplace satisfaction, the way that you communicate benefits may be just as important as the benefits themselves. In fact, those employers with poor quality benefits packages were able to improve workplace satisfaction ratings by 32 points with highly rated benefits education.
- Benefits Changes on the Rise; Quality of Benefits Education on the Decline. Roughly half (45%) of employees surveyed reported that they had seen changes in their benefits packages in 2009. And yet, the quality of benefits education declined sharply as 29% of workers gave their benefits education positive ratings in 2009 vs. 39% in 2008.
- Accommodate various learning styles. 70% of employees surveyed use web-based materials when available. Online videos and interactive tools are a great way to satisfy all three learning styles – visual, auditory and “hands on.”
- Effective benefits education helps retain talented employees. In fact, 77% of employees who believed their company had good benefits education said they would stay with their employer even if they were offered the same pay and benefits elsewhere. As the job market improves, employees feel more comfortable looking elsewhere, so communicating the value of benefits is important.
Investments in benefits education can be a low-cost, high-impact way to affect worker satisfaction. Even when paired with a below par benefits package, effective benefits education can be a cheap means to dramatically improve job satisfaction, employee engagement, loyalty and productivity. Unlock the value of your benefits package with benefits education.
