leveraging employee benefits technology to improve your company's bottom line

leveraging employee benefits technology to improve your company's bottom line

By: tim fitzpatrick, senior vice president, employee benefits, ioa & nancy damato, rda benefit services

Recent events have drastically changed how many businesses operate, and technology is playing a much greater role than ever before. With many employees working remotely and some still reporting to the jobsite, a new set of challenges emerges. Compliance with the day-to-day tasks of managing employees and administering their employee benefit plans has not changed, however. Communicating the details of their benefits offerings, tracking eligibility, and processing enrollments, among other tasks, are very important and time-consuming responsibilities. These tasks typically fall to a company’s human resources or finance department, and many smaller companies rely on a more all-purpose role, such as an office manager. These individuals are often more than qualified to handle these tasks, but the question becomes, is this the most efficient strategy, especially when everyone may not be in the same location?

Many small and mid-sized companies manually administer their employee benefits program through paper communication. This involves the dissemination of physical benefits summaries and requires the collection of paper applications for coverage. Although this can be an effective strategy if executed properly, there are some serious issues worth consideration:

• Compliance – are you able to properly track and document an offer of coverage and a subsequent election or waiver of that coverage? How about state and federally required notices, such as COBRA? Are you sure you are providing all the necessary notices to your employees?

• Communication – are you able to effectively outline all benefits offered and the accompanying rules, such as new hire waiting periods, that go along with them? Do you have a new system in place with employees working remotely?

• Time – how much time is your internal team spending on this process? What is your process for providing new benefit information to your employees so that they have enough time to decide during Open Enrollment? If outsourced properly, can their time be spent in a more strategic and cost-effective manner?

• Money - using manual processes to track employee information and perform payroll calculations often results in human errors. Using an employee benefits platform has proven to reduce these costly errors. One example provided by the general agency Savoy projects that a company with 75 employees could save up to $28,000 annually by changing over to an online system.

SOLUTION: Employee Benefit Administration Systems

“Ben Admin” systems are software solutions designed to centralize your HR records and synchronize your employee data across several systems. This includes payroll, new hire onboarding, benefits, and paid time off. These tools allow you to streamline the communication and tracking process for your company’s benefits package through an online portal designed specifically for your firm. The primary and most obvious advantage to these systems is online enrollment. Managing a manual enrollment process during the best of circumstances can be difficult, but recent events are exposing the limitations of this strategy as remote working and furloughs are becoming more prevalent.

“Online enrollment has been around for years, but this pandemic is highlighting one of its basic advantages, paperless enrollment,” Employee Navigator CEO, George Reese, explains. “In light of the new social distancing environment we find ourselves in, the ‘new normal’ won’t include in-person enrollment meetings for quite some time.”

When evaluating a benefits administration system, there are some key points to consider.

Cost, flexibility in design, integration with current carrier and payroll systems, and the ability to create a digital paper trail are all important factors in assessing what solution is the right fit for an organization. There are many more variables to consider so it is important for employers to enlist the help of a trusted advisor such as their insurance broker. Many brokers have established relationships with vendors in this space and can offer their clients product and pricing advantages over the open market.

George Reese continues, “While any broker can set-up and manage an enrollment solution, companies only benefit from brokers who have invested in developing operational expertise in this area that can supercharge the benefits of an online enrollment platform.”

Companies will need to adapt in the wake of the Coronavirus crisis and develop new and more efficient methods for connecting with their employees. Benefits administration systems can help in this endeavor by adding considerable value to an organization’s backend processes. They can create greater efficiencies in workflow and help to streamline the communication process, doing so in a more compliant manner. Employers should thoroughly evaluate how they can best leverage technology to maximize the advantages of an employee benefits platform and modernize their business processes.

Contributions from George Reese, CEO, Employee Navigator and Colleen Patterson, Director of Employer Services and Compliance, Savoy