The fact is that the open enrollment process is evolving, especially for small to mid-size employers. It is migrating from a stand-alone, manual process to an automated, integrated environment where the latest technologies combine to make open enrollment as efficient, effective and productive as possible. Current research shows a migration from older, more obsolete methods of processing benefits applications to web-based initiatives that greatly streamline and enhance the entire process, thus creating a compelling employer ROI and more favorable employee experience.
The current state of “open enrollment” is a spectrum of 3 main approaches:
- Companies that use a traditional paper-based enrollment process
- Companies that use a stand-alone software application or web portal for enrollment data collection
- Companies that use an enrollment application that integrates with other critical HR applications
Paper-based enrollment has been around since the beginning of the enrollment process itself. Many companies still trust this method, thinking it is a satisfactory way to produce and distribute all benefits information to their employees. But let’s look at what’s really involved in this process:
- Printing benefits information
- Checking information for errors
- Assembling benefits brochures
- Manually sorting benefits materials so each employee gets information applicable to their current status
- Distributing benefits materials either by hand, or by mail
This first part of the process alone usually takes 1-2 weeks.
Next, comes the challenge of the actual enrollment itself. Most HR departments find that they need to assist employees in filling out the paperwork, thus opening up the chances for HIPPA violations. Lastly, the enrollment data must be compiled and manually entered into the carriers system AND into the company’s payroll system for premium deductions to occur. Human intervention, namely data entry, is always an error-prone process. This process requires:
- Enrollment forms that are checked manually for accuracy
- HR staff chasing down employees to determine who has completed the process
- Benefits calculations by hand
- Manual entry of enrollment information into the carrier site
Manual entry of deductions amounts into the payroll system
- Paperwork filed and stored on premise in employee files
This process can add an additional 2-3 weeks to the entire process.
The paper-based, manual method of open enrollment also incurs a soft cost that cannot be measured; employee dissatisfaction. Employees today are not happy with the level of communication they receive from traditional open enrollment. They want information on their terms. They want to be able to access everything they need to make an informed decision, including their own personal data, from one source. And they want to be able to access this information when it is convenient for them. Companies that do not deliver what employees are looking for risk falling behind in today’s competitive workplace.
Stand-alone software/web systems for enrollment are another common approach. This spectrum involves the implementation of an automated solution to process open enrollment. The case for such an approach is clearly made in the example above.
The key business drivers for eliminating a paper-based process and replacing it with an automated process are:
- Reduction in the time it takes to process open enrollment
- Elimination of the the cost of producing and storing paper materials
- Mitigating the possibility of human errors
- Increasing employee satisfaction
Typical applications enable storing and access of all benefits-related materials online, where employees and their families can review at their leisure. All enrollment forms are also completed and submitted online, with greater validation capabilities for enhanced accuracy. This results in major gains for the employees, including the ability to manage all their own enrollment programs, including FSA’s and 401(k) in one centralized location.
This type of portal allows employees to:
- Review material and make decisions at home with their families
- Get answers to questions directly online
- Compare and contrast different plans all through one easy interface
- Edit and update selections without having to contact HR
Employees are not the only ones who benefit from enrollment automation. Thanks to the customizable, rules-based validation capability present with this technology, the system will catch errors and incomplete information, prompting employees to make changes as needed.
Additionally, managers and administrators can run reports to discover who still needs to complete the process and send automated reminders, without having to chase down employees on a one-on-one basis. The workload on HR staff is greatly reduced, as employees can handle their own enrollment tasks.
Deploying such a streamlined new process can greatly reduce the time it takes to process open enrollment, and free up key staff to focus on more important tasks. Deploying an online benefits enrollment process can have a dramatic effect on an organization that is used to the slow, manual paper-based approach, cutting the process time in half from 4 down to 2 weeks.
An online enrollment process has some major advantages over paper-based enrollment—but it still falls short in several key areas.
Research has shown that employees and administrators are still dissatisfied with the level of information and analysis tools that are available with many stand-alone benefit enrollment applications. The fundamental issue is that in order to make informed healthcare decisions, employees, HR administrators, and financial buyers need access to data commonly found in HR/Benefits and workforce management systems. Access to demographic information alongside of benefit participation data allows a company to analyze trend so that no group is overpaying or under-utilizing the benefits. Data can be segmented into employee groups by:
- family status
- pay scales
- and multiple combinations of the above
This information helps an employer to make decisions on the contribution strategy for all benefits offered. The employer can maximize their benefit spend and in turn contribute fair amounts based upon the employee need.
Synchronizing data between the benefit enrollment software and the day-to-day HR/Benefit system is key to achieving this because employee data is always changing. This includes:
- Changing departments
- Changing pay-grades
- Changing locations
- Changing family status
- Changing work status and more
Some of these changes may alter employee eligibility and require the move from one type of plan to another. Without the proper system integration, data synchronization errors can result. Using disparate technologies to track employee information also results in data needing to be entered multiple times in multiple systems, or information that must to be imported from one system to another. In either case, the result is the same; information quickly becomes out of date soon after it is transferred. It is absolutely necessary that an organization’s benefit enrollment system is working off of the same database as their HR system to avoid these issues. The best option is a to find a system that offers both, day-to-day HR/Benefit management and one-time open enrollment management in one package.
The Completely Integrated Single System, one database approach is the best option available today. The need to make more information available to employees, and the need to streamline processes even further, are what drive many companies into the third—and most advanced—phase of their open enrollment evolution. This is the sweet-spot, where businesses integrate their benefits enrollment system with their HR/Benefits and workforce management platforms to develop a truly comprehensive, integrated approach.
When open enrollment is deployed as a complete, full-service package, an organization can:
- empower an employee’s decision process by providing all information they need—including paystubs, HR, business rules and workforce management—through one interface
- enter and update all employee information in one place
- maintain up-to-date data throughout the open enrollment process
- know that data integrity is assured from system to system
By taking this approach, a business is giving employees the dynamic tools to make open enrollment work for them. And HR departments gain the most streamlined, efficient process possible. Time and effort are saved, and important HR resources can be redeployed for more strategic tasks—all for a minimal investment in technology.
Current research shows that the complexity of open enrollment is a top concern for employers. It is the complexity of this process that can result in errors, additional costs, long delays and a drain on the resources of your organization.This makes it essential that you evolve your open enrollment through the deployment of the right technologies in order to restructure your process into the most efficient and effective operation possible.
Understanding the phases of open enrollment is key to this evolution. Knowing your place on the spectrum, and where you need to go, can help you make smarter technology decisions. Migrating to each new phase has its advantages, with the final option as the ultimate goal.