7 ways to keep your sanity during open enrollment
Originally posted on https://ebn.benefitnews.com.
‘Tis the open enrollment season in the benefits world. For many benefit managers, that means stress, panic and very long days (and nights). But there are ways to make this time of year less frantic and more productive.
HR cannot run open enrollment in a vacuum. So lean on consultants and communication pros to craft your messaging. Turn to senior leaders for top-down messaging on why changes are happening. Bring in your benefit vendors to explain the impact of changes and walk employees through the enrollment process. Like many things, open enrollment takes a village, so use yours.
Few things can set off a fire drill like systems crashing and just plain misbehaving – especially with online enrollment. Get ahead of the game by partnering with IT to determine how people will enroll, how data will be handled and how it needs to flow between departments (like HR and payroll). Map out contingency plans and decide who will be on point if things go awry.
Be straight-up with employees about what’s changing, why and what they need to do. No spin. No sugar. If you’re making significant plan changes this year, use personas to help people understand how this will affect them. And provide decision guides that walk them through all the variables (particularly deductibles, co-payments, HSA contributions, covered services and provider network details) so they can make the best choice for themselves and their families.
We all put a ton of blood, sweat and tears into benefit planning and open enrollment communications – so much so, that it can become a bit of a one-way street. Keep in mind that this is a time when employees are sitting up straight and paying attention. Ask for their feedback. How do they feel about what’s changing? The benefits overall? Why? What could be done differently? Whether you’re talking with employees at a town hall, engaging with them over social media or asking for their honest responses to a survey, really listen to what they have to say, thoughtfully respond and act on their feedback as much as you can.
We know – right now, it’s all you can do to stay focused on the enrollment at hand. But it’s less daunting than it sounds: what we’re suggesting is that you take employee feedback and lessons learned from this enrollment period and start compiling them for next year. That might be possible benefit changes, new benefits to add or ways to communicate differently. You know what they say about the early bird … and in this case, the sooner you nail down what 12 months from now looks like, the more proactive (and effective) you’ll be when it comes to next year’s systems and communications.
Why not make open enrollment fun – and an opportunity to earn points and prizes? Launch an Open Enrollment Challenge and reward employees for taking various actions, like attending an open enrollment info session, updating beneficiary details and enrolling by a certain date. Or plan an Open Enrollment Walk, where people can head out for a stroll with HR and colleagues, giving them an opportunity to ask benefit questions along the way (and make time afterward too).
Although you may feel like you just don’t have time to take a break, right now you need it more than ever. Along with those enrollment meetings, town halls, social media replies and survey reviews, block time for yourself on the calendar. Go for a run, head out for a relaxing healthy lunch, read a great book, meditate, take a yoga class – whatever makes you happy and keeps you sane.
Nearly One in Four Employers Say Private Health Insurance Exchanges Could Provide a Viable Alternative for Full-Time Active Employees in 2016
Originally posted September 25, 2014 on https://www.insurancebroadcasting.com.
ARLINGTON, Va.--(BUSINESS WIRE)--Results of a July 2014 survey of midsize to large employers by global professional services company Towers Watson (NYSE, NASDAQ:TW) showed that 28% said they had already extensively evaluated the viability of private exchanges. Nearly one in four (24%) said private exchanges could provide a viable alternative for their active full-time employees as soon as 2016.
“Private exchanges are a relatively new path for many employers — one that has only recently become available to provide benefits for active employees”
The results are from the 2014 Towers Watson Health Care Changes Ahead Survey, which was completed by 379 employee benefit professionals from a variety of industries and reflect health care benefit decisions for 2016 – 2017.
The survey also revealed that the top three factors that would cause employers to adopt a private exchange for full-time active employees are:
Evidence they can deliver greater value than their current self-managed model (64%)
Adoption of private exchanges by other large companies in their industry (34%)
An inability to stay below the excise tax ceiling as 2018 approaches (26%)
Public Exchanges Not Considered Viable for Full-Time Active Employees
In contrast, nearly all employers surveyed (99.5%) said they have no plan to exit health benefits for active employees and direct them and their families to public exchanges, with or without a financial subsidy. More than three out of four employers (77%) said they are not at all confident public exchanges will provide a viable alternative for their active full-time employees in 2015 or 2016.
“Private exchanges are a relatively new path for many employers — one that has only recently become available to provide benefits for active employees,” said Dave Osterndorf, a managing director with Towers Watson’s OneExchange. “However, with the Patient Protection and Affordable Care Act’s excise tax top of mind for large employers, and with the potential to cost companies billions of dollars unless they act now to keep the cost of health benefits below government-mandated thresholds in 2018 and beyond, new solutions are necessary. Even employers that have managed to keep increases in their health care benefit costs lower than industry averages are working very hard to maintain that success. Private exchanges offer employers a new opportunity to save on health care coverage with a reduced operational burden, which is the main reason they are more seriously evaluating them for their active employees.”
Data from the 2014 Towers Watson Health Care Changes Ahead Survey revealed that nearly three-quarters (73%) of employers said they are somewhat or very concerned they will trigger the excise tax based on their current plans and cost trajectory. More than four in 10 (43%) said avoiding the excise tax is the top priority for their health care strategies in 2015.
Osterndorf added, “Effective private exchanges can provide value in many ways. For example, as more employers move to account-based health plans, they can realize the promise of avoiding the excise tax while providing the added benefit of putting employees in charge of how their health care dollars are spent. Private exchanges offer more choice, including account-based plans, with the tools and support for helping employees make better health decisions, and recognize the connection between their physical and financial well-being. Employee understanding and engagement are critical to the long-term sustainability of an employer’s program. Private exchanges can accelerate the fulfillment of that goal.”
According to the 19th Annual Towers Watson National Business Group on Health Employer Survey on Purchasing Value in Health Care, released in March 2014, nearly three-quarters of respondents currently offer account-based health plans (ABHPs), with another 9% expecting to add one for the first time in 2015. Nearly 16% of respondents have adopted ABHPs as their only plan option, up from only 7% in 2012. Nearly one-third of all companies could offer ABHPs as their only option by 2015, if they follow through with current plans.
About the Surveys
The 2014 Towers Watson Health Care Changes Ahead Survey offers insights into the focus and timing of U.S. employers’ plans and perspectives related to their health benefits, and their efforts to better manage costs and employee engagement, as well as their planned responses to the business risks associated with the 2018 excise tax. The survey was completed during July 2014 by 379 employee benefit professionals from midsize to large companies across a variety of industries and reflects respondents’ 2014 – 2017 health care benefit decisions. The responding companies comprise a broad range of industries and business sizes, and collectively employ 8.7 million employees.
The 19th Annual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in Health Care tracks employers’ strategies and practices, and the results of their efforts to provide and manage health benefits for their workforce. This report identifies the actions of high-performing companies, as well as current trends in the health care benefit programs of U.S. employers with at least 1,000 employees. The survey was completed by 595 employers between November 2013 and January 2014. Respondents collectively employ 11.3 million full-time employees, have 7.8 million employees enrolled in their health care programs and represent all major industry sectors.
ABOUT TOWERS WATSON
Towers Watson (NYSE, NASDAQ: TW) is a leading global professional services company that helps organizations improve performance through effective people, risk and financial management. The company offers consulting, technology and solutions in the areas of benefits, talent management, rewards, and risk and capital management. Towers Watson has more than 14,000 associates around the world and is located on the web at towerswatson.com.
New benefit offers education help to parents of special-needs children
Originally posted September 12, 2014 by Andrea Davis on https://ebn.benefitnews.com.
Joanne Burke can’t count the number of hours she spent researching special-needs law and preparing for meetings with educators and therapists about her daughter Gabby’s individualized education plan. Gabby, eight, was born with spina bifida, a birth defect that happens in utero when a baby’s still-developing spinal column doesn’t close all the way. When she was four, Gabby was also diagnosed with a rare form of epilepsy, which caused steep cognitive regression. Today, Gabby primarily uses forearm crutches to get around and attends third grade at a public school.
It is families like Burke’s that led Adam Goldberg to launch myEdGPS, a company that helps parents of children with special needs map out an education plan for their child. It’s a program that can be offered as a standalone employee benefit, and it is also being offered through Bright Horizons, a provider of child care services as part of that company’s suite of employer offerings. The Bright Horizons program, Special and Exceptional Needs, powered by myEdGPS, will be exclusively offered to companies with more than 3,500 U.S. employees by College Coach, a division of Bright Horizons specializing in providing answers to education concerns.
Burke’s employer, an automotive parts supplier based in Michigan where Burke lives with her husband and Gabby, has been supportive of her need for flexibility. They’ve offered Burke a flex-time schedule where she starts at 6:30 a.m. and leaves the office by 2:30 p.m. to collect Gabby from school. And, when she returned to work after Gabby was born, she was able to work from home on days when Gabby had multiple medical appointments. Still, when Gabby was ready to go to school, Burke spent countless hours attempting to figure out the family’s options. While she investigated sending Gabby to a private school, in the end, the private school could not handle Gabby’s multiple needs. Through the public school system, Gabby has access to physical and occupational therapy, as well as speech therapy.
“It's just a lot of juggling. It's almost like having two full-time jobs at once,” says Burke. “The case management aspect of it can be pretty heavy at times. It's not all the time, but if there's any sort of medical issue going on, it can take up a lot more time and effort to manage all of that at once.”
After years of providing private consulting services to parents who could afford to pay for it, Goldberg, who holds a masters’ degree in education with a concentration in assessment, realized that “we were turning away 95% of folks who couldn’t afford to pay for these types of private services,” he says. “This really was the manifestation of my burning desire to democratize the model and be able to scale it through technology so that we could have an impact on millions of children and their families out there.”
One in five children struggle with some type of special or exceptional need and Goldberg estimates that translates into an impact on 10% or more of the workforce. Working parents lose up to five hours a week running around to various doctor, therapist and teacher appointments, to say nothing of the hours they spend filling out paperwork and figuring out who’s paying for what.
Goldberg likens myEdGPS to TurboTax for special education because when parents first enter the online system, they’re asked a series of questions, a virtual intake of sorts. Then, depending on how far long parents are in their journey, the system serves up a series of roadmaps designed to guide parents and give them the necessary information, depending on what their needs and goals are.
They system also includes a virtual binder that can be accessed on any mobile device to help manage and store all the documentation involved. There’s also a calendar feature, which Goldberg says is particularly useful since different states have different timelines for when certain documentation needs to be provided and to whom.
“Once the system knows your child is being educated in Ohio, for example, and you request an evaluation, the system knows to alert you that within X number of school or calendar days, based on Ohio regulations, that you should expect to hear a response back from the school and then it goes to the next step in the timeline,” he explains.
The system also includes a behavioral tracking journal for parents and a letter generator “so that you can get it right the first time when you’re requesting an evaluation from the school or an independent evaluation of the school, or requesting a team meeting to address an issue,” says Goldberg.
Bright Horizons is currently piloting the program with a handful of companies, says CEO David Lissy. It’s included in the company’s core offerings but employers can also customize the program to include in-person education onsite and/or live webinars.
And apart from helping employers with productivity issues, Goldberg says myEdGPS offers the opportunity for tangible savings on health care expenses.
“What most people don't know -- including parents, administrators, and especially employers -- is that the knee-jerk reaction is to go to the medical plan if you suspect something's going on with your child, without any knowledge that you can actually get some of these same exact services from a school,” he explains. “That's a federally mandated system. The two systems [health care and education] really don't talk to each other that well. What we're doing is we're helping empower these parents to be able to understand what their rights are and how to go about it, step by step, finding the right help in the right ways through schools.”
For example, an employee has a five-year-old child who may not be hitting certain developmental milestones. The parent’s first instinct is to take the child to the pediatrician, who then refers the child to a series of specialists. Each visit requires the parent to take time off work, the medical plan incurs costs and the employee may have co-pays to deal with.
“The reality is, at the very beginning you should also be requesting an evaluation through school, because it's free if you ask for it in the right way,” says Goldberg, adding that there’s a whole host of related services, including speech language therapy and some behavioral therapies, that are within the legal construct of the Individuals with Disabilities Education Act.
“All of this fundamentally is supposed to be free and in very many cases overlap with those medical services,” he says.
For Joanne Burke, who researched all of daughter Gabby’s educational and therapeutic needs herself, a service like myEdGPS would have been invaluable. “If I had access to a resource like this it would free up valuable time to address other issues,” she says. “The law is complex and learning how it affects our daughter as well as learning about accommodations and assistive technology is constantly in the back if my mind.”
Is it time for a checkup for your client's 401(k) plan?
As we approach the end of the plan year for most plans, now is a good time for plan administrators and plan sponsors to give their 401(k) plans a quick once over to see if everything is properly in place. The IRS even provides a 401(k) plan checklist with some suggested corrective mechanisms that can be taken to bring plans into compliance.
A good starting place for a compliance tune up is to see if you can answer some basic questions about your plan:
- Who are the trustees?
- Who is the plan administrator?
- Who are the outside service providers and how often are they contacted?
- What are the plan’s eligibility rules and who is responsible for verifying them?
- How are participants notified of eligibility?
- How is plan documentation distributed?
- Where are the plan records kept?
- Who is responsible for preparing and filing the form 5500?
After you get past these, some basic questions about plan administration come into play:
- Who keeps track of contributions and limits?
- How does the plan define “compensation”?
- What is the vesting schedule?
- Are there required contributions from the employer?
- Who is responsible for the discrimination testing?
- Does the plan permit loans and how are they tracked?
- Who is responsible for reporting to participants?
- How are distributions made and who is the contact person?
The reason I bring this topic up is that I was recently working with a client who had one person who was solely responsible for benefit administration. Unfortunately that person passed away suddenly and no other person in the organization could answer any questions about the 401(k) plan. Although it seems like the above information is simple to collect, the company still spent hours and hours recreating the plan history because they neglected to keep a record of how the answers to these questions had changed over the years.
Think of your 401(k) plan as a well maintained car. It needs a check up on a regular basis to keep running smoothly. You have to keep records of what was done and you have to know where the important information is if you need it. Just like your car, you hope your 401(k) plan never breaks down. But in anticipation of a future problem, it is worthwhile to stop and make a record of the responsibility for plan administration and the current status of the plan. That way it will be easier to make repairs if they ever become needed.
7 sins of wellness programs
Gold standards are starting to emerge for corporate wellness programs. Virgin Pulse, which has been monitoring wellness program adoption and design, says there are basically two categories extant in the corporate world today: wellness 1.0 and wellness 2.0.
The overarching difference lies in engagement levels. But engagement has been a tricky quality to define, and even harder to achieve. Virgin's idea with 1.0/2.0 is to simplify the process, identify the major components that can lead to engagement, and offer easy-to-adopt methods to begin to grow engagement.
“While wellness 1.0 is a great start to showing your employees you care, it’s limited from the very beginning — many of these programs can be inapplicable and unappealing to a vast majority of people,” Virgin says in “Moving Beyond Wellness 1.0. “They may not offer enough variety or flexibility for people at different stages of their journey to better health. For some, there may be too many barriers to participation for them to overcome.”
Wellness 2.0 programs tend to include options that address three key health areas:
- Exercise options, which make “people more energetic, focused, and productive”;
- Healthy food options and health eating support, which offset “poor nutrition stemming from eating too much sugar, carbs, or fat can actually [which] cause cognitive impairment”; and
- Sleep assistance options, because people who are well rested perform much better on the job than do those who don't get enough sleep.
But beyond those elements, the 2.0 programs don't have the characteristics that Virgin found in programs that are bedeviled by lack of engagement.
Virgin starts by examining the 1.0 level of wellness programs, and offering a list of defects that these low-engagement programs typically display. The Seven Deadly Sins of wellness 1.0 programs are:
- They only target the sick
Positive: Good for those with health issues who want to change.
Negative: Limits the number of employees who will be interested in the program or who can take advantage of what is offered. - They don’t encourage lasting behavior change
Positive: Elements of the program can lead to quick benefits.
Negative: Healthy behaviors aren't reinforced so health gains are often lost later on. - They don’t engage your potential wellness champions
Positive: For those they target, these plans can work well in the short term.
Negative: If the program is all about helping people with health problems get somewhat healthier, the program leaves out the healthy workers who want to further enhance their health. These people can be champions of the wellness plan, Virgin says. But too often they are not considered in plan design, so they don't participate.
- hey lack daily engagement
Positive: There isn't one for this category.
Negative: Poor communications with employees about their wellness options can doom even a robust wellness program. As Virgin notes, “Once the kickoff meeting is over, an employee’s health risk assessment is complete, and they have their login for the wellness site, most don’t engage with the program again until they’re nudged — or as far out as the next wellness kickoff meeting.” Engagement needs to be daily, Virgin argues, to drive engagement. - They focus on HRAs and biometrics alone
Positive: Both are great tools for evaluating the physical well-being of your workforce.
Negative: Too often, the information from HRAs and biometrics screenings isn’t used to create an actionable wellness plan that helps address the health concerns these assessments uncover.
- They only offer rewards upfront
Positive: The upfront “bonus” attracts people to the program initially.
Negative: That bonus is often the only tangible reward employees ever see for participation. “The unfortunate result is that many of the people you’d like to see in your program may very likely disengage after the big initial reward is gone,” Virgin says. - They’re an administrative burden
Positive: Keeps employment strong in the HR department.
Negative: Costly! “The last thing you need is a system that’s tough for you to manage and tough for your people to use. Unfortunately, that’s often what happens with wellness 1.0 programs. The harder it is to administer, the further down the list of priorities it falls.”
How to help alleviate specialty Rx costs
Originally posted September 9, 2014 by Melissa A. Winn on https://ebn.benefitnews.com.
Half of large employers say the cost of specialty pharmacy drugs is their second or third highest cost-driver, behind high-cost claims and special conditions, according to a recent survey by the National Business Group on Health. Brian Marcotte, NBGH’s president, calls the concern “significant,” considering specialty pharmacy currently impacts only about 2% of the population, but advancements in the manufacturing of these expensive drugs threaten to greatly increase the number of employees using them.
As employers consider their 2015 health plan designs, they “are very focused on specialty pharmacy drugs and the potential impact they have” on the company’s bottom-line, says Marcotte. Benefit advisers can add value by offering solutions to reign in the costs of these drugs, including programs to limit the quantity of the drugs dispensed at any one given time, the use of prior authorization to confirm the necessity of the treatment, and even the use of a freestanding specialty pharmacy.
“Benefit advisers should make sure employers are utilizing all of the specialty clinical programs offered by the medical and pharmacy vendors for their benefits,” says Brenda Gagnon, a pharmacy benefit adviser and president and CEO of the health care consulting firm B.M Gagnon Associates.
This is especially true in light of the fact the utilization of the drugs is bound to increase. “Current estimates for specialty medications are that they will cost an employer 50% to 60% of their total health benefits by 2016,” says Gagnon.
That’s true not only because the high cost of developing and manufacturing the drugs is reflected in their high price tag, but also Gagnon says, because “drug manufacturers have put more effort into finding more than one drug therapy for the drug.”
For example, she notes, AbbVie’s Humira is used for rheumatoid arthritis, Crohn’s disease, colitis and psoriasis.
Research and development costs are “passed onto the employer when an employee is taking a specialty medication,” Gagnon adds, saying the cost of the drugs can be anywhere from $1,200 to $12,000 a month, depending on the disease.
Utilization controls
An employer client has no control over the high price tag on these drugs, says Michael Zucarelli, national pharmacy practice leader for the employee benefit and financial firm CBIZ.
Where benefit advisers can help employers tame their client’s drug spend, however, is through health plan options designed to manage these drugs’ utilization, he says.
First and foremost, plans should have some sort of appropriate use protocol or prior authorization. Such a procedure would ensure claims are reviewed to make sure the drugs are safe and effective for the employee, as well as safeguard the plan financially, suggests Zucarelli.
In addition, employers have an opportunity to manage drug use as the number of specialty drugs available to treat any one disease expands, creating competition within the drug classes.
Employers “can now become a little more creative in how they set up their plan. They may prefer one or a couple of treatments over another,” he says.
This can be designed as a formulary in which a less expensive drug option would be covered at 100% and the more expensive option would require the employee to pay 100% of the cost share, he says. Otherwise, it can be set up as a step-therapy program, in which the more expensive drug cannot even be used until the less expensive option has been tried and failed.
“We’re seeing plan sponsors look at that as an option and more are adopting it,” says Zucarelli, adding that he typically advises employers to institute a step-therapy program as soon as possible, while it affects only a small number of plan members.
Advisers can also work with employers on channel management, Zucarelli suggests, saying employers should have a consultant, pharmacy benefit manager, or medical plan carrier evaluate where the drug spend is to gain visibility and look at opportunities for site-of-care management.
“Maybe a patient is getting a particular specialty drug in a hospital infusion suite and that may not be the most convenient or cost-effective treatment,” he suggests.
Gagnon agrees employers can use a third-party consultant company like Artemtetrx, which uses data analytics to evaluate claims data and identify high drug spend and opportunities for cost management across clinical management, reimbursement management, site of care management and plan design.
When an employer client raises a question about a high-dollar claim, Zucarelli says the plan’s PBM or carrier could also be asked to do a case review and insure the patient is taking the high-cost drug for an appropriate use.
“Unfortunately, once an employee is on a certain drug, it’s hard to get them off of it or switch it,” he says, adding that that’s why he suggests employers get a lot of these tactics in place now, before the use of the drugs increases, which is inevitable.
“Getting these management techniques in place now is going to further minimize disruption,” he adds.
5 tips to make retirement education meaningful
Originally posted on https://eba.benefitnews.com.
Through the use of education and communication, employers and benefit advisers can have a huge impact on their employees’ retirement readiness. Making that education meaningful, however, is key to employee engagement and understanding. Here are five tips from Grinkmeyer Leonard Financial and investment advisers with Commonwealth Financial Network on how to make retirement education meaningful.
1. Paint a picture of their "future self"
Employees who can envision their future selves are more likely to understand their financial needs during retirement. The advisers with Commonwealth Financial Network suggest one strategy for embracing your future self is to have employees envision not only their financial retirement goals, but also lifestyle retirement goals. By forcing today’s self to recognize how he or she will look in the future, employees are more likely to save for that future, they say.
2. Help them plan for an achievable number
For too long the financial services industry has focused on the daunting pot of money people should accumulate in order to retire, the advisers say, adding that breaking the number down to monthly saving increments is less scary and seems more achievable to employees.
3. Account for health care
A 2013 study conducted by Fidelity's Benefits Consulting Group estimated that out-of-pocket health care costs for a 65-year-old couple with no employer-provided retiree health care will be $220,000, assuming a life expectancy of 17 years for the man and 20 years for the woman. As part of a comprehensive financial education plan, the Commonwealth Financial Network advisers say it is imperative that medical and insurance costs be incorporated into the retirement planning discussion.
4. Start 'em young
The power of compounding interest is evident in retirement plan balances, the advisers say, adding that evidence has shown the benefits of starting to save at a young age. Interest adds up over time, so even starting to save at 30 instead of 40 can save exponentially more money.
5. Keep the message relatable
Paramount to the success of any education strategy is using simple terms and relatable examples to illustrate potentially complex issues, the advisers say. For example, telling a group of participants that inflation will erode the buying power of their dollar over the entirety of their retirement may be lost in translation, they say. But telling that same group of participants that the $5 sandwich they enjoy today will cost $22.93 in 30 years will likely keep their eyes from glazing over.
Better understanding of benefits helps both employee and employer
According to new research from Unum, a recent survey of more than 1,500 employees shows only half of U.S. employees would rate their employer as excellent or very good. Even less than that, the 47% who were offered benefits by their employer, rated the actual benefits as excellent or very good — some of the lowest ratings for benefits the Unum has seen in recent years.
The data points to a lack of employees getting information needed on the benefits being offered. Only 33% of those surveyed who were asked to review benefits in the prior year rated the benefits education they received as excellent or very good — a drop from 2012 and reversal of the upward trend since 2009.
“Offering employees effective benefits education can contribute to satisfaction with their employer,” says Bill Dalicandro, vice president of the consumer solutions group at Unum. “Even if employees don’t have a particularly good benefits package, those who say they received quality education about the benefits they are offered are far more likely to consider their employer a very good place to work.”
Employers can also get a win when providing educational guidance in choosing the right benefits. Correlation between employee satisfaction with their benefits continues to run parallel with overall employer satisfaction.
More than three-quarters of those employees who rate their benefits package as highly also rate their employer as an excellent or very good place to work. By contrast, only 17% of employees who consider their benefits package to be fair or poor rate their workplace as excellent or very good.
Additionally 79% of employees who reviewed benefits in the past year and rated their education as excellent or very good also rate their employer as excellent or very good — compared to 30% who said the education they received was fair or poor.
The survey also found:
- 40% of employees say they understand supplemental medical coverage somewhat or very well.
- 47% say they understand critical illness insurance somewhat or very well
- 48% whose employers offered long or short term disability insurance said no one explained disability insurance to them.
- 66% agree employers should do a better job educating employees about these important benefits.
“This research underscores the value of an effective benefits education plan, because when an employee understands their benefits, they tend to value them more and in turn may then value their employers more for providing access to them,” Dalicandro adds.
Employers partner with academic institutions to create specialized programs
Originally posted August 27, 2014 by Nick Otto on https://ebn.benefitnews.com
It’s a new spin on an older system, as benefit managers are trying to evaluate the long-term benefits of helping to pay for their workers’ education — and more cost-effective and results-oriented methods of doing so. The big question: do these programs indeed serve to attract more candidates, and does the training necessarily produce workers who are better skilled and interested in staying with their current jobs?
In the past, tuition reimbursement programs were a more unstructured offering — occasionally the classes needed to be work-related in order to qualify for employer reimbursement, depending on an employer’s needs — resulting in a pleasant but not entirely critical employee benefit, with workers paid back for their studies as long as they maintained an acceptable
grade level.
Under a new model emerging at a variety of employers, direct partnerships with the online-specific satellites of accredited post-secondary institutions are helping to create more specialized and self-directed educational offerings, catered to the skill sets employers have found lacking in their workers. The participating college offers a discounted tuition rate and in exchange, the employer works to promote that particular program. Employees have less range of choice in educational offerings as a result, but may find the classes more individually suited to their needs and ultimately more important to their professional development.
“Corporate America is always trying to attract and retain the best talent, that’s certainly a very key HR strategy for most employers,” says Carol Sladek, partner and work-life consulting lead at Aon Hewitt. “So what we’re seeing is an increased interest on the part of employers to try to find the types of benefits and programs and policies that will help employees not only join their team, but stay on their teams and also help better employees along the way.”
Anthem Blue Cross and Blue Shield of New Hampshire partnered last year with College for America, a nonprofit college launched specifically for working adults and their employers, to create a competency-based program with no credit hours or courses. Students learn through projects targeted toward specific, employer-focused skills — communication, teamwork, ethics and others — resulting in either Associate- or Bachelor-level degrees. One of the biggest perks is the price tag: At $2,500 annually, the all-inclusive program is self-directed and online, providing an approach that allows students to progress through the program at their own pace.
Chris Dugan, director of public relations for Anthem’s New Hampshire operations, says it was one of the first companies to partner with the university last year, and since then, the insurer has had 56 employees participate in the program.
“Not only are employees going through this program stronger at their day job, but it could open up other opportunities in our company — so we promote this vigorously to our employees, and they seem to have strong interest [so far],” Dugan says. The convenience factor, plus Anthem’s arrangement to pay employees’ tuition, has also added to the new program’s success.
To date, College for America has enrolled nearly 1,000 students since its pilot launch in January 2013, adding more than 100 new students per month in recent months. Currently, it has about 60 employer partners — including corporate, government and nonprofit groups — offering the College for America program to their employees.
“We’re currently in program development discussions with several national employers and associations who see a specific labor market need where a competency-based, workforce-applicable degree would help with their talent development pipeline,” says Colin Van Ostern, a member of the college’s leadership team. “We’re seeing significant demand.”
Another example of corporate-academic partnerships can be seen with Starbucks, which recently created a program allowing any employee working 20 hours a week or more to be eligible for a full reimbursement if they enroll in Arizona State University’s online program as juniors or seniors. Freshmen and sophomores receive a partial scholarship and needs-based financial aid toward the foundational work of completing their degree.
According to data from EdAssist, an administrator of tuition assistance programs, spending on — and utilization of — tuition assistance varies by industry. Among health care companies in its database, for example, the average annual spending per employee on tuition assistance is $2,332, yet the industry boasts the highest utilization rate at 8%.
Anthem and Starbucks’ examples come in contrast to other employers’ internalized education programs — fast-food retailer McDonald’s and its well-known Hamburger University in Oak Brook, Ill., a corporate managerial training program that has offered skills-based training to thousands of company employees since being founded in 1961.
Whatever the venue, Karen Hutcheson a partner in the rewards and talent management practice at Mercer, says that employees are keen in keeping up with current skills.
“I’m finding employers also want to make sure their employees have those opportunities; it’s a win-win,” she says. “On the employer side, if you can educate your workforce in an affordable and manageable fashion, you can feed into stronger engagement.”
Higher education needs to be more nimble and responsive to student needs, she adds. And people in the workforce want strong skills, but the cost of traditional higher education is so high. “This is a nice way to marry the two together,” Hutcheson says.
Limiting options
On the flip side, overly focused programs do limit some employees’ options, and might lead to lower benefit participation.
“With the lack of choice, high potential employees may discount the value of obtaining a degree or graduate degree,” Hutcheson says. And although it’s still too early to tell, another potential downside would be the perceived value of an online degree versus the historical degree. “Not all Bachelors [degrees] are created the same,” she adds.
Bruce Elliott, manager of compensation and benefits at the Society for Human Resource Management, says the College for America model is part of a growing trend of employers working with community colleges, vocational schools and traditional universities to create structured programs.
Part of that growth, he says, seeks to offset a continued imbalance in the labor pool.
“During the height of the recession, there were employers desperate for skilled tradesmen and couldn’t find them to save their lives,” he says.
In the future, Elliott says he expects to see more corporate partnerships as a way of helping to drive down the cost of continuing education for employees — particularly in the Starbucks’ example.
“The reality is, these kids will be graduating with maybe $10,000 in debt,” compared to the much higher numbers in average student loan debt as the result of traditional, self-funded college programs. “You do the math.”
Aon Hewitt’s Sladek says that business costs and overall return on investment continue to be the biggest questions facing benefit managers as they consider the wider range of educational options.
“A lot of employers are sitting back waiting to see what will happen,” she says. “The Starbucks thing was really interesting and there was a lot of interest. I think a lot of other employers are standing on the edge watching.”
Hutcheson calls it a “wave of the future.”
“What we’re seeing in the workforce are people being more focused on building and maintaining skills,” she says. “We see employers wanting to see their employees be more prepared and in charge.”