Employees Often Don’t Understand Their Healthcare Benefits. Here’s How To Fix That

Your benefits package can give you an important competitive edge—but only if employees know how to use them.
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If HR leaders want their employees to make appropriate decisions when electing and using their healthcare benefits, then the organization needs to provide helpful education year-round—not just during open enrollment, says Kim Buckey, vice president of client services at Carmel, Indiana-based Optavise, which helps benefits brokers, employers and employees navigate the healthcare benefits world.

Buckey spoke with StrategicCHRO360 about why your benefits package is more important than ever and how to craft a communications strategy for making sure employees understand what’s available to them.

Why should HR teams help employees become better healthcare consumers?

Today, the average employer invests $21,726 annually per employee in employee benefits—benefits that are too often misused or go unused because employees aren’t aware of them or don’t understand them. Employees traditionally spend little to no time reviewing their options during open enrollment season, and this can be attributed to many of them feeling overwhelmed and confused. By not taking the time to understand what plans work best for them and their families, employees risk paying more than they need to for coverage.

A study by the National Bureau of Economic Research found that 71 percent of people couldn’t identify basic cost-sharing features of health insurance plans. In a national assessment of adult literacy, only 12 percent of adults were deemed to have “proficient” health literacy—that is, the capacity to obtain, process and understand basic health information and services needed to make appropriate health decisions.

Compared to those with proficient health literacy, adults with low health literacy experience four times higher healthcare costs, 6 percent more hospital visits and hospital stays that are two days longer than the average, according to the Partnership for Clear Health Communication at the National Patient Safety Foundation. This means that employers and employees alike end up paying more than they need to for their healthcare—and employers are losing money on their benefits investment.

What role does benefits communications play in that process? 

To truly help employees become better healthcare consumers, HR teams need to remember that benefits communications is a year-round requirement, not just an activity that occurs at open enrollment. Preparing and executing a benefits communications strategy ensures that HR—and its partners—are focused on the same objectives, coordinating their communications efforts for maximum impact and meeting employee information needs.

If you have access to benefits communications specialists, make use of them. Your typical benefits communicator has spent years, if not decades, learning how to write about benefits in a way that drives engagement. They’ll also have suggestions on enhancing readability, and even what channels will reach your audience segments.

How should HR teams be thinking about benefits communications, especially as more people look for new jobs and HR teams prepare to onboard new employees?

Today’s employees—particularly in the midst of the Covid pandemic and the Great Resignation—are more focused on benefits than ever before. Reportedly, some 20 percent of workers changed jobs during the pandemic, and 30 percent of employees switched jobs for better benefits. So, it’s more critical than ever that employers ensure that prospects, new hires and current employees alike are aware of all of the options and programs available to them, how to access them and what the advantages are.

A robust benefits package—with flexibility for the employee or job candidate to select a range of programs that supports their physical, mental, emotional and financial health—can be a substantial competitive advantage if the intended audiences are aware of them.

If onboarding is being done remotely, one-on-one communications channels—telephonic or virtual—can ensure new hires get their questions answered and are directed to where they can access information, such as summary plan descriptions and online resources, to reference at their convenience.

HR teams may want to leverage internal champions or employees who have used certain benefits to get the care they need. By bringing these examples to life and putting a name and face to the story, other employees may be encouraged to take action knowing that a colleague has been through the process.

What tips do you have for HR teams to devise a successful benefits communication strategy?

Take a look at what types of questions you or your customer service teams have received in the past year or two. Identify any patterns. For example, are you getting a lot of questions about fertility coverage? Have there been a lot of complaints about billing and claims? Use this information to craft future messaging.

Make sure to consider all of your audiences—employees and their family members, managers, retirees, new hires, prospects, employees who work on-site versus those who work remotely or on different shifts.

Determine your goals and objectives. Do you want to increase participation in a particular program? Drive employees to use urgent care or retail clinics instead of the ER? Encourage enrollment in a particular health plan option or in voluntary coverages?  How will you determine whether you have achieved those goals?

Look at what channels you are using to share information with your audiences. Are you using everything available to you—and are they actually channels your employees use? For example, relying on printed posters and group meetings may not make sense if most of your employees are working from home or off site. Look at what tools have—and haven’t—worked in the past, and when in doubt, ask your employees what they prefer. Keep in mind that personal conversations are the preferred channel for employees across the board. In fact, 80 percent of respondents to a recent DirectPath survey reported that these conversations are very or extremely helpful.

Schedule your messaging and make use of multiple channels throughout the year. You want to make sure employees have access to, and hear, the information they need when they need it. Reminders about free preventive care and vaccines, for example, are especially timely in late summer, before the start of the school year. Alerts about impending flexible spending account claims deadlines are helpful in mid-spring. Reminders about money-saving programs like advocacy and transparency, or well-being plans like employee assistance and other wellness plans should be repeated frequently.

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