Inflation Narrows Employees' Choices at Open Enrollment
Nearly half of employees said high prices make it difficult to pay for benefits
Nearly half (48 percent) of U.S. workers report that inflation is making it difficult for them to pay for their benefits, while 40 percent said inflation will make them scale back on the benefits they choose during open enrollment for 2023. These findings are from The Hartford's Future of Benefits Pulse Survey of approximately 900 full-time and part-time employed adults in the U.S., conducted in July.
Employers should advise employees "to take extra time this year to reflect on what changes have occurred in their life and select the benefits that best fit their individual needs and budget to help protect their finances in the long run," said Dana MacKinnon, head of relationship management strategy and enrollment for The Hartford, a provider of accident, disability and other insurance benefits.
Younger workers were more likely than their older peers to report that they would cut back on benefits. More than half (51 percent) of workers ages 18-34 said they are likely to scale back on their benefits, compared with 41 percent of those ages 35-54 and 25 percent of those age 55 and older.
Approaches to Benefits Selection
The survey also showed that many respondents roll over the same benefits choices they made the previous year. While some are "analyzers" who study the coverage and crunch the numbers for all of their benefits choices, others are "avoiders" who tend to ignore all the open enrollment e-mails and would prefer not to think about their benefits. Some are characterized as "planners" who keep up-to-date on benefits throughout the year so they are prepared at enrollment time, and others as "consulters" needing to talk with someone else before making their benefits selections.
However employees approach benefits decisions, employers can help them to understand their benefits options so they can make informed decisions that protect themselves and their families. MacKinnon suggested the following actions:
- Communicate all year long about benefits so employees are better prepared at decision time. Many workers (39 percent) indicated they typically enroll in benefits as soon as the open enrollment window opens.
- Offer a variety of tools to reach the workforce, such as e-mails, webinars, one-on-one support from benefits counselors, educational videos and interactive decision support tools. About 48 percent of U.S. workers have used social media platforms to learn about benefits, with YouTube and Facebook being the most common platforms used.
- Use clear language and personalized messaging to demonstrate how the insurance products relate to employees' lifestyle rather than simply listing what benefits are being offered.
- Highlight the services that are available through the benefits program, such as mental health counseling through an employee assistance program or will preparation services through a legal advice benefit.
Employer Priorities for Enrollment Season
Employee health and well-being is top of mind for the majority of employers (cited by 60 percent of respondents) when it comes to benefits priorities going into 2023, according to another recent survey. Other top priorities include cost containment of health care prices (40 percent), improving employee satisfaction and engagement (38 percent), and leveraging benefits to attract talent and reduce turnover (23 percent).
Ease, an HR and benefits software firm for small businesses, recently released the above findings from its 2022 Open Enrollment Readiness Report, which surveyed more than 1,700 employers and brokers in June and July.
"Inflation, an uncertain economy and the ongoing churn from the Great Resignation have placed benefits offerings squarely at the forefront of talent attraction and retention strategies," said David Reid, CEO and co-founder of Ease.
In 2022, a growing number of employers (74 percent) said benefits administration technology remained a high priority going into this year's open enrollment season. Specifically, employers noted better cost-estimating tools for employees (32 percent), personalized employee engagement materials (30 percent) and easy enrollment technology (22 percent) as the top three areas insurance brokers should support.
Related SHRM Articles:
Open Enrollment Success Relies on Effective Communications, SHRM Online, August 2022
Open Enrollment for 2023 Reflects a Changing Benefits Landscape, SHRM Online, August 2022
Health Insurance 'Knowledge Gap' Is Wide as Open Enrollment Approaches, SHRM Online, August 2022
Fine-Tune Benefits Before Open Enrollment, SHRM Online, July 2022
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