Online Platforms Transform Open Enrollment

This is the first in a series of articles on meeting fall 2018 open-enrollment challenges for 2019 benefits. The other two installments are Employees Seek Personalized Perks During Open Enrollment and For Open Enrollment, Communications Get Social.

Consider this example: For the 2017 plan year, American Eagle Outfitters (AEO) increased the number of health plans offered at open enrollment. The company already offered two preferred provider organization (PPO) plans, which have low deductibles but high premiums, and a PPO-like, consumer-directed health plan (CDHP) with a health reimbursement arrangement (HRA). It added two low-premium, high-deductible health plans (HDHPs) with health savings accounts (HSAs).

If that overload of acronyms seems confusing, imagine how AEO's employees felt.

"We had a huge amount of education around that," said Tammy Fennessy, senior benefits manager at Pittsburgh-based AEO, which has 32,000 full- or part-time U.S. employees spread over more than 1,000 retail outlets, two distribution centers and three corporate offices.

In 2016, about 72 percent of AEO's workers were enrolled in PPO plans, "and we knew that our workforce really didn't belong there. With our store-based workers being predominantly Millennials, they're a very healthy group of people, even when benchmarked against other retailers," Fennessy said. "They were burning their money on premiums," and so was the company.

In reflecting on the fall 2016 open enrollment, Fennessy said, it was clear that the use of traditional communication methods hadn't moved workers out of the PPOs and over to the HDHPs, even when an online benefit-selection advisory tool that the company provided told them that, based on information they entered, an HDHP was the right plan for them. "Instead, the response tended to be, 'Yeah, I'm comfortable in the PPO. I think I'll just stay here,' " Fennessy said.

So last fall, AEO put in place an interactive enrollment platform from tech firm Benefitfocus. When they sign in, employees see an online hub called AEO2Go.

Behind the scenes, the platform analyzes employees' medical claims over the past year (shielded from the employer in keeping with federal HIPAA health-information confidentiality requirements). During the benefit-selection process, employees were shown, based on that data, how much they would have spent in 2016 under each of the health plans that AOE offered, "and that helped to give them a full picture of which plan made the most sense for them. Our population had that 'aha' moment," Fennessy said.

As a result, for AEO's employees who enrolled last fall for the current plan year:

• HDHP/HSA plan enrollment rose to 36 percent from 7 percent.
  

• PPO enrollment dropped to 42 percent from 72 percent.
  

• CDHP/HRA enrollment stayed consistent at 21 percent.
  

"It was a huge shift for us," Fennessy said. "Showing employees their claims through the platform brought the message home that they were paying too much in premiums for the type of plan they truly needed to be in."

Consolidating the Benefits Experience

The AEO2GO hub is also accessible via a mobile app. The single sign-in platform lets employees "click on any vendor connections without having to put in another username and password for information on their medical, disability, life insurance, flexible spending account, and voluntary benefit options, as well as the 401(k) plan," Fennessy said. "They can go in and make whatever changes they need to make."

During the year, employees use the portal to make benefits adjustments such as changing HSA or 401(k) contributions, altering beneficiaries and enrolling in well-being programs.

"This year, in response to employee feedback, we're adding an additional vision plan that's more robust in covering eyewear and contacts," Fennessy said. "Anytime we have a new offering, we put it front and center on the portal and use videos"—which are scalable so employees can watch them on their phones—"to let them know what's new."

"With video, plan comparison tools and cost estimators integrated into the enrollment process, employees can better understand their benefits beyond the price of the premium," said Catie Grigsby, senior manager for content marketing at Benefitfocus.

[SHRM members-only how-to guide: How to Design an Employee Benefits Program]

Enrollment Tech Upswing

Most employers have increased their spending on benefits-related technology in the past five years, with about half expecting further increases in the next three years, a 2017 study of 2,000 benefits decision-makers by The Guardian Life Insurance Co. of America showed. "Benefits technology is reshaping how employers think about their benefits strategy," said Marc Costantini, executive vice president, commercial and government markets, at Guardian. "A multi-generational workforce along with mounting pressures on employers to contain costs, simplify their benefits, and stay compliant are prompting employers to make this a priority."

That view was echoed by other providers of benefits-administration software and technology.

"A growing number of employers are looking to consolidate multiple workplace benefit plans onto a single platform, streamlining administration and creating a more simplified experience for employees," said Kevin Barry, president of workplace investing at Fidelity Investments, a large administrator of retirement and other benefit plans.

"We see a broad trend of enrollment portals unifying the employee experience by showcasing a wide range of benefits, programs and perks that an employer offers," said Joe Levon, vice president of strategic partnerships at Jellyvision, a benefits communication tech firm. "Each year, enrollment portals are expected to serve as a gateway to a broader suite of benefits available to employees."

"In today's business environment, many employers are communicating with employees whose ages range five or more decades," noted Shelly McLean, a principal at benefits tech firm OneDigital. "The newest group of employees entering the workforce expect self-service, choice, [and] ease of access and to make personal buying decisions."

"Millennials want everything at their fingertips and taken care of in one place," said Zane Dalal, executive vice president at Benefit Programs Administration. "They want to access their benefits and services on the go—whether they are at work, home or traveling."

A sign of enrollment platforms upping their game is a just-announced move by tech benefits firm PlanSource to integrate Jellyvision's interactive benefits counselor, Alex, into its benefits platform "so that employees can go from learning about their benefit options (education) directly into choosing/purchasing (enrollment) their medical insurance and retirement savings plan," PlanSource wrote in its announcement.

"When companies can pair a communication and education tool alongside their benefits-election platform, there's a clear amplification and impact on the employee experience," Levon said.

Human Support Still Popular

Although enrollment platforms are becoming more user-friendly, there is still interest in contracting for one-on-one support services around enrollment, said Kim Buckey, vice president of client services at DirectPath, a provider of personalized benefits education, enrollment and health care transparency services.

Online products that help with the enrollment process can be a great starting point, Buckey said, "but everyone has their own particular nuance in their life that might color what benefits they chose and what plan might make the most sense for them, which is one reason we're seeing more interest in [providing access to] human interaction."

Given that, overwhelmingly, employees simply roll over to the same health and benefit plans year after year, "there's a level of communication required to impress on individuals that this isn't always the best thing to be doing," Buckey said.

Related SHRM Articles:

Does AI Have a Place in Open Enrollment?, SHRM Online, September 2019

Data-Driven Benefit-Selection Tools Are Just Getting Started, SHRM Online, September 2019

For Benefit Platforms, Employers Pick User Experience Over Cost, SHRM Online, January 2018

Related SHRM Resouces:

SHRM's Open Enrollment Guide & Resources

Vendor Directory: Benefits Enrollment and Admin