Applying Newton's laws of motion to annual enrollment

This is the time of year when most benefits professionals are taking a slight breather after completing the fall annual enrollment season. In reality, most of you are already actively reviewing the results before you start to plan for this year’s enrollment.

As you prepare for the year ahead, think back many moons ago to some of the first lessons you had in physics. Newton’s laws of motion may have been the bane of your high school existence, but in reality, they affect every part of our lives, including annual enrollment!

According to research conducted by Alight Solutions after the fall 2018 enrollment season, only 54 percent of employees actively enrolled in their benefits, meaning almost half of employees chose to do nothing, which could mean keeping last year’s coverage at current rates, missing an opportunity to contribute to a health savings account (HSA) or flexible spending account (FSA), or enroll in new benefits offerings. In fact, only 16% of employees changed their medical plan from the prior year. These enrollment rates have remained fairly consistent across the last several years.

One thing is clear from these results: workers’ behavior during the enrollment period mirrors that of Newton’s first law of motion.

To give a quick refresher, the first law of motion states that an object at rest stays at rest unless acted upon by a force.

Let’s see it in practice:

Employees that did enroll or make changes to their benefits during annual enrollment likely had an external force acting upon them such as changes to the benefits they were enrolled in, annual cost increases, or changes in their family situation. Most employees (i.e., the objects) began annual enrollment at rest and they stayed there throughout the process.

Newton’s other two laws of motion explain how to change the motion of an object:

• An object’s rate of change is proportional to the force applied against it.
• For every force, there is an equal and opposite force.

These laws can also be applied to annual enrollment and help give benefits professionals some guidance if they want to increase employees’ active participation this year.

First, define specific, measurable goals and objectives for the upcoming enrollment season. Most employers have general goals such as increase HDHP enrollment or “no noise” from employees. The problem is that it is difficult to measure success against those goals. By taking the step to clearly define and measure goals, organizations will be able to determine how much force to exert on their employees. For example, increasing HSA contributions and number of HSA participants by 10% may require less force than a 50% increase in high deductible health plan (HDHP) enrollment.

Second, exert force. Remember, force needs to be applied to move an object at rest or change the direction of the object. Employees will keep doing what they’ve always done unless force is exerted, or a specific action is required of them. The more aggressive the organization’s goals, the more force may be needed. Consider plan design, administrative practices, and communication levers to exert the force needed. Here are a few ideas for effectively applying force:

• Differentiation: Is there enough difference between features and costs of medical plans? Achieving a 20 percent increase in HDHP enrollments is unlikely to happen if the premium for the HDHP is the same as medical plans with lower deductible and/or co-pays.
• Change defaults: Consider changing your HSA default strategy during open enrollment. According to research from Alight, employers that default the HSA to the employee’s current contribution see significantly higher employee participation rates in the HSA compared to employers that default the employee’s contribution to zero each year.
• Give suggestions: Alight research shows that when employees receive personalized benefit suggestions, employers are more likely to achieve their enrollment goals: 35 percent of customers change their medical option – double the rate of employees that do not receive a benefits suggestion; and 77 percent of employees contribute to an HSA compared to 61 percent for employees that do not receive a benefits suggestion. Suggestions provide employees with a cognitive “anchor” from which to adjust enrollment decisions. In absence of a suggestion, the anchor is often the employee’s current plan.
• Consider active enrollment: Generally, most employees keep the same benefits they currently have unless they want or need to make a change. Understanding this to be the case, companies should consider conducting an active enrollment that requires all employees to make new benefit choices and default them to no coverage if they don’t enroll. According to research from Alight, organizations using an active enrollment strategy often see enrollment rates of 85 percent or higher. But to keep employees from simply re-enrolling in the same plans they’re in today, you’ll also need to shake up the benefit offerings or premiums more than normal. Requiring people to mechanically re-enroll without benefit changes creates more noise than the value the organization may achieve.
• Decision support: Annual enrollment can be overwhelming, and people need and want more help to make the most appropriate decision for their coverage. According to Alight’s data, people believe decision support tools are valuable—especially those that provide more personal and relevant content and services. Decision support tools like health care cost modelers, provider search tools, plan comparisons and guided enrollment experiences help make the enrollment process easier.

Next, plan for the equal and opposite reaction: When organizations exert force, employees will react. Remove barriers and reduce friction wherever possible. Help employees understand what’s happening and why, and be ready for their reaction.

• Segment benefits communications to better educate and promote your organization’s benefits strategy.
• Communicate with employees and their family members through the channels they prefer including digital (email, text, online), webinars and even employee meetings. Personalize the messages to make the most impact.
• Make sure operations are ready. Is the organization prepared to handle any increase in calls from employees? Can the website handle any additional traffic? Will employees have the tools they need to make complex decisions?

Finally, continually validate that plan design, administrative and communication decisions are aligned with the overall goals and adjust as necessary. Without alignment, any force applied might not move the object in the desired direction. It can be quite easy to get off track or lose sight of the bigger picture.

As you enjoy the slight breather before the heavy lifting of planning begins for the 2019 enrollment season, keep these laws of motion in mind. While it’s commonplace to reflect on enrollment data annually and make key decisions in next year’s enrollment process based on that information, too often, we leave out the human aspect of the process and forget to take a step back and look at the motivations behind the decisions our employees make. Thanks to Newton and his three laws of motion, we can confidently approach the upcoming enrollment period with the understanding that workers need a nudge from their employers in order to maximize the value of the benefits they receive.

Read more:

• Seeing the whole person: Make open enrollment work for everyone
• 5 communication insights (and actions) for open enrollment
• 5 strategies to improve CDH adoption this open enrollment season

Karen Frost is senior vice president of health strategy and solutions at Alight Solutions. She has more than 25 years of experience in health solutions and is responsible for growing and innovating Alight’s health solutions.

Sara Taylor is a product development leader within Alight’s health solutions business. She is responsible for innovating and developing Alight’s health solutions.