Open or Annual Enrollment is about as much fun as doing your taxes. It’s something you have to do, even though it’s something no one wants to do. And like tax preparation, taking the time to do it correctly can have a huge impact on your employees and your business.
To better understand what “doing it correctly” means, let’s first think about the typical open enrollment process.
Every fall your employees receive some sort of generic communication notifying them that it’s open enrollment season. Those communications probably range from a postcard to a brochure. And somewhere in those communications is information about their health plan options for the upcoming year. I’m assuming that information is probably technical, boring and therefore a bit intimidating. Immediately overwhelmed (because health insurance is inherently complex and overwhelming), your employees don’t make the effort to understand the different plan options, costs and coverage, or recognize they may be overpaying. Instead, they pass on making a decision and opt to continue on their current coverage (or the next generation of their coverage). And by passing on the decision, they are passing on the opportunity to make health insurance better for themselves and for the company!
As an HR representative who wants the best for his/her organization and employees, your primary goal is to help employees make the best choice about their health insurance plan (and save your organization some money along the way). If so, are your enrollment communications working hard enough to change your employee’s default behavior?
Before you answer that, think about the following:
- 28% of employees cannot correctly define “co-pay”
- 41% of employees cannot correctly define “maximum out-of-pocket” expense
- In a recent study, each participant was asked to presume he’d use a certain amount of health care and, based on that, to choose the lowest-cost plan from among eight choices, which varied by premium, doctor co-pay and deductible. Only 21 percent could accomplish this task, a figure not statistically different from chance. The annual cost of errors was about $250.
These statistics are scary considering we ask employees to put on their smart healthcare consumer hats once a year and make informed decisions about the health plans that impact both their lives and your business.
Because many employees are healthcare illiterate and inexperienced, a large portion of the population ends up overpaying for health insurance. By doing so they believe they’re erring on the side of caution when instead they should be taking the time to consider their actual health care needs and evaluate their plan options against those needs. You know the numbers for your organization – how many of them would save money by switching plans? Probably moving to an HDHP and HSA? I bet it’s more than 10 people. Probably a few hundred. Maybe even a few thousand. Now think about how making the transition could benefit those employees in the long run and, in turn, how much it would save your organization?
So what’s holding them back? Based on the evidence it’s a lack of understanding—and fear—since when it comes to health no one wants to feel like they’re taking shortcuts.
So then the question becomes: how do we help employees overcome their fears and insecurities to become expert healthcare consumers?
By creating communications that respect your audience and meet them where they are at. This means communications should not only raise awareness about the open enrollment period, but also educate employees. It means using conversational language, not jargon. It means creating visually interesting comms so employees take the first step and read whatever you’re sending them – or at the very least don’t discard it immediately.
Creating open enrollment communications that emotionally resonate with your employees takes time. If you’re only thinking about it four weeks out, you’re probably too late. We recommend starting your open enrollment communication planning three to four months ahead of time. This gives you an opportunity to define and vet your open enrollment goals. It also gives you a chance to review your communication tactics to see if they support your established goals. For example, if you need to educate people about basic insurance lingo, burying definitions on the second to last page of a 12-page brochure is definitely advised against. Maybe it’s better to produce table tents for the cafeteria with quizzes about different terms a few weeks before the open enrollment period. Then, during open enrollment, you can remind your employees about those terms at the front of the brochure, but spend more time talking about the plans themselves.
If you’re looking to move a portion of your employee population to HDHP and HSAs, you need to help them understand why an HSA might be a better option and is absolutely worth consideration. How do you do this? Well, you start by talking about HDHPs and HSAs in real language. Not HR speak. Not legal speak. Both can be intimidating and off putting. And your employees probably haven’t invested as much time as you understanding the language and the nuances of the different plan options so you need to explain it in a way that makes sense to the novice healthcare consumer.
Remember, buying insurance, even if you’re passively rolling over from one year to the next, is an emotional decision. You need to stop treating it like a purely factual decision and start connecting with your employees’ emotions so they better understand the facts and can earn their smart healthcare consumer badge by making the best decisions for them, and hopefully for your business.