By now, it’s widely known that The Great Resignation and Great Reshuffle have caused a great kerfuffle in the labor market. And, if you want to see just how disruptive and reverberative the impacts have been, one need only to observe the shifts in open enrollment and employee benefits. Offering creative and dynamic benefits is no longer a luxury employers can use to attract and retain talent; these days, they often must provide them.
“Although always critical,” says Will Spong, executive vice president of employee health and benefits for Lovitt & Touché, “The Great Resignation brought companies’ employee benefits packages to the forefront in terms of importance for potential hires as well as existing employees.”
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According to a recent survey conducted by Paychex (an HR, payroll, benefits company), 64% of respondents expressed that because their company updated their employee benefits, they had no plans to leave within the next year. Another survey conducted by WTW (formerly recognized as Willis Towers Watson) revealed that an estimated 87% of employers in the U.S. stated that enhancing medical health benefits will be one of their top priorities over the next two years.
Shifting work-related mindsets
To better understand why employee benefits packages are more competitive than ever, it’s important to absorb the full context of not only The Great Resignation’s influence, but how the pandemic shifted the work mindset of the nation.
“Whether it’s COVID or the Great Resignation, I think people in general have been making a lot of personal decisions around work and personal life,” says Joe Greenberg, general manager Commercial Business Segment for Blue Cross Blue Shield of Arizona. “And I think a lot of people have started prioritizing their wellbeing, family, personal decisions and their own career fulfillment ahead of their employment.”
Ample data supports Greenberg’s assessment, including a joint McKinsey/Ipsos study that revealed “When people have the chance to work flexibly, 87% of them take it.” And a survey conducted by Prudential revealed that 45% of employees feel “more empowered to ask employers for benefits and accommodations they need to manage work and life.”
The colossal question now for employers is how to modify or enhance their open enrollment and employee benefits to accommodate a growing — but also varied — desire for improved benefits packages and processes.
Meeting the needs of an evolving labor market
“Beyond competitive pay, time off and healthcare — all of which remain immensely important — employers have added benefits in direct response to what potential employees are seeking since the pandemic triggered the Great Resignation,” Spong says. “These can include specific perks such as remote or hybrid work options, family leave, child care assistance and mental health services.”
Added to the list of perks have also included pet insurance, gym memberships, career development opportunities and other similar benefits.
But, the focus on upping or enhancing employee benefits may not be as predominant of a trend as is personalization of employee benefits.
“Employers are spending a lot of time right now personalizing the benefits that they offer,” Greenberg says, “they’re really thinking about their employee population or the population that they want to attract in the future.”
Adds Greenberg, “Whether it’s medical or financial, dental or vision, or 401k, they’re thinking about, ‘How do we offer the most comprehensive benefit package that meet our [employees] specific needs, and how do we do it in a way where we can make sure that people really understand the value that we as an employer bring to our employee population to keep them and their families as well as possible?’”
In addition to personalization, Heather Kane, chief executive officer for UnitedHealthcare says there’s another consideration employers should prioritize amidst the state of high-competition hiring.
“Employers seeking to recruit and retain employees need to consider the ‘whole person’ — the health and wealth concept — and how they integrate it,” Kane explains. “Tying in pharmacy, specialty, or 401K options and reminding people about how their benefit programs will not only help each individual and their dependents stay healthier physically but also financially — that’s more important than ever.”
Communicating benefits better (and beyond open enrollment)
According to a recent MedCityNews publication, although 82% of workers in the U.S. feel knowledgeable about the health insurance enrollment process, 53% don’t think they’re getting the most out of their options. In the current competitive employment climate, effective communication of employee benefits is crucial. And it begins with open enrollment.
“Employees have different expectations today than they did before around how their employer communicates with them,” Greenberg says. “The process has become more personable, virtual, and a lot more two-way in terms of the dialogue and interaction.”
Greenberg goes on to hypothesize that the days of hosting open enrollment sessions spread over 10 meetings during a two-week period with experts, materials and rooms packed full of employees are over (or at least dwindling).
Adds Krane, “The focus of open enrollment has become more targeted on explaining to members what your benefit plan can do for you versus a traditional messaging around ‘what is in the benefits plans.’ This shift in conversation is occurring around both in-person and virtual care options.”
Greenberg, Krane and Spong unanimously agree that digital-based employee benefits options are on the rise. They’re also increasingly more comprehensive.
“First, employers deploy technological solutions to assist with benefits enrollment, including web portals and apps employees use to select and manage their benefits,” Spong says. “This is overlaid with additional solutions to help educate employees about their benefits, specifically health plans, making them better consumers of healthcare services.”
These opportunities enable employees to gain access to acquire information that can improve their healthcare decisions, help them find convenient and affordable providers and — according to Spong, allows “employees to play an increasingly active role in choosing more affordable care options, saving both them and their employers money.”
Kane cautions, however, that no matter the communication delivery system of employee benefits, it shouldn’t end with open enrollment. “Our advice,” she says, “Be persistent and put the information out there in front of [employees] as if they are all new to it. Don’t forget to welcome people each and every year to their benefits, as this effort is critical to making employees feel they are valued. This will help with making sure benefits get used properly and costs/utilization stay in line.”
Spong encourages employers too, to practice their due diligence in understanding and being able to convey the ins and outs of employee benefits. “Some 80% of employees don’t open or read their benefit materials, according to a 2021 study from the International Foundation for Employee Benefits,” he says. “Of the 20% who do read the material, 49% don’t understand it. Shifts in how employees work since the pandemic have only added to these difficulties.”
In closing, Greenberg advises, “The more employers can really understand the unique and specific needs of their population, the better the benefit offering will be, and the more they’ll be able to meet those needs.”
