Successful benefits programs: A fifth player emerges
Employers have increasingly relied on benefit administration systems to relieve their team of burdensome work.
During a recent discussion with an associate about our business, we agreed that we have traditionally identified four major players in successful benefit programs: employers, employees/dependents, brokers/advisors, and insurance companies/benefit service providers. But a fifth player has entered the picture and may be the most important of all: the employer’s selected benefit administration system.
In the past, I often thought of ben admin as a background commodity. The market has proliferated with a variety of systems to choose from, all designed to provide benefit administration functions. But as the market has matured, employers have increasingly relied on these systems to relieve their team of burdensome work. How does an employer approach the selection process?
Related: Benefits administration complexity creates broker opportunities
There are some key functions that employers and their advisors need to consider. Some have become more important in light of the increasing number of employees working from home. Others have increased in importance based on advances in technology, both within the ben admin platforms and inside insurance companies and product manufacturers.
Working from home changes needs in functionality and communications. Ben admin platforms need to be easy for employees and their dependents to access from home. Access via mobile technology is part of that, as is an intuitive interface. Ongoing benefit communication throughout the year needs to be a primary use of the system. It should be easy for employees to obtain info about their benefits and claims processes, enroll in or modify their benefits, obtain forms, and update their info for the employer. The system can also act as a communications hub, pushing out messages targeted to specific employees.
Second, advances in technology have made it possible for benefit admin systems to act as real-time processing hubs for multiple insurance companies and providers. These connections are automated data feeds between the employer and their insurers. There’s never a gap between a change and the insurer being updated. This can extend to automated processing of the evidence of insurability provided by those applying for excess coverage, or entering the program when ineligible for guaranteed coverage. This eliminates confusion for everyone.
Billing often causes administrative issues and extra work for the employer’s team. It’s important to understand how the system operates with respect to the insurance company billing systems and the employer’s payroll system. When there is an interface between the bills and payroll, with the benefit admin platform providing the hub, there can be seamless transition of info between the employer, payroll and insurer. All processes happen simultaneously. Most billing issues will be eliminated.
Selecting the appropriate benefit administration system is important. Key factors include:
- Capabilities for ongoing benefit related communications to employees
- Ease of accessing the system by remote employees (including the employer’s benefit management team)
- Interfaces between the benefit administration platform, the employer’s selected benefit providers, and their payroll companies
- Traditional evaluation standards like price, customer testimonials, and demonstrated functionality
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