Benefits Administration Breakdown

In the spirit of full disclosure, I’m new to OneDigital Health & Benefits and new to benefits consulting, having spent the last twenty-three years working for various health insurance carriers. I’m still drinking from the proverbial fire hose in my new role, but one thing I have learned very quickly is that the job of an employee benefits consultant is not just about the benefits themselves, but also about how to communicate those benefits to employees; how to get employees enrolled in plans that best meet their needs; how to keep employers and providers compliant with an abundance of regulations; and how to help employers and their employees navigate a confusing and often cumbersome process with limited to no pain. In short, benefit consulting is as much about benefit administration (“BenAdmin” from this point forward) as it is about benefit program design.

More and more, employers and their consultants are turning to technology to make the BenAdmin process more efficient and effective.

Where there is demand, supply will follow, and the BenAdmin technology supply chain is chock full and getting fuller. This saturated market makes the process of choosing a partner to help make benefits administration less confusing really confusing. Confused? Of course you are. So, to help make sense of it all, here’s a list of key considerations when developing a BenAdmin strategy and/or choosing a technology solution:

One size does not fit all. We’ll call this the cardinal rule. It’s the underlying theme driving the other key considerations that follow. Different situations call for different solutions and there are many different options available to employers for benefits administration. These options include manual/paper enrollment; using carriers’ web-based self-service enrollment tools; third-party enrollment platforms that spit out eligibility files for transfer to the carriers or transmit eligibility via full-blown Electronic Data Interchange (EDI); enlist the help of a soup-to-nuts benefits enrollment firm; or some combination of these. And within most of these options there are seemingly countless vendors from which to choose, with varying degrees of capability and service. The good news is you can almost certainly find a BenAdmin solution that meets your needs. The challenge is that you need to properly and thoroughly assess all of the options against those needs, and that’s where it can get confusing. Fortunately, your benefits consultant can help with that.

What’s your budget? As there is a wide range of available BenAdmin solutions, there is also a wide range of costs. The natural reaction to this point is, “Oh no, I can’t afford to spend another dime on my benefits!” But the truth is that you’re likely already incurring costs related to your benefits administration and compliance, even if not in the form of outright fees. How much time is your Human Resources team spending on benefits administration and compliance? How many headaches are they suffering for it? What important work are they not doing because of said time and headaches around BenAdmin? An honest cost-benefit analysis often reveals that hiring a BenAdmin partner or paying for BenAdmin technology may be well worth the expense.

What’s your workplace environment? By workplace environment, I mean - are you a single site or multi-site (or even multi-national) employer? Do you have a multi-lingual workforce? Do all of your employees have access to technology (computers, internet, etc.) at work? The BenAdmin solution you adopt will depend on how you answer the above questions, and others, regarding your workforce and workplace environment.

How complex (or not) is your benefits strategy and structure? If your benefits are fairly simple – medical/prescription insurance only; one plan; one set of rates; one uniform contribution strategy; one carrier… you get the point – your BenAdmin needs are fairly simple too, and your technology solution doesn’t have to carry a lot of firepower. On the other hand, if you offer your employees multiple lines of coverage and multiple plan options within some of those lines; you have multiple divisions and/or employee classes, each with a unique premium contribution strategy; and you layer on top of that wellness incentives, spousal surcharges, voluntary benefits, employer funding of an HRA or H.S.A., and more, well then, you have an entirely different BenAdmin need and your technology solution has to be robust.

No pain, no gain. If you’re going to implement BenAdmin technology or convert from one platform to another, invest the time and effort up front to assure long-term success. To get it right, there will be a level of effort on the part of the employer to determine business requirements, interview potential vendor partners to assess capabilities, choose the right technology partner, and thoroughly and accurately build-out the specifications. Without question, the vendor of choice will run point on implementation and offer ongoing support throughout, but it is not an effortless process for the end user. Cutting corners up front will almost certainly lead to post-implementation frustration, so take the time and get it right from the start. You will be rewarded in the end.

Whatever you do, if you feel your current BenAdmin needs are not being met and you need a change, don’t go it alone. Contact your OneDigital Health & Benefits Consultant or Advisor and we’ll help you figure it out.