According to the Bureau of Labor Statistics, workplace benefits are available to 74% of American employees, which equates to a lot of work for benefits administrators during open enrollment periods (BLS). However, with the right information, employee benefits plan enrollment doesn’t have to be a headache. With a better understanding of the process (and the right partners), you can make the process less stressful and more efficient.
Guide to Open Enrollment
Benefits are an important part of any HR strategy. They can impact recruiting, retention, employee loyalty, and more. However, your benefits package only helps the employees who actually use it.
Open enrollment is your annual opportunity to boost employee engagement, productivity, and well-being. During this time, it’s crucial for HR to support the team through employee benefits plan enrollment. You can do that by communicating clearly, keeping to a set schedule, and expecting the unexpected. For example, you could set aside time to answer your employees’ questions and follow up with your insurance carrier. Partnering with a broker can help you streamline this process since you’ll have more access to an expert in the field.
Most importantly, HR should plan ahead. Reading this article is a great place to start. You can also check out other resources on Paycor’s site to learn more about benefits administration. Now, let’s look at some of the most common questions HR professionals have about open enrollment.
1. What is Open Enrollment?
Open enrollment is a period during the year, generally two to four weeks long, when companies allow their employees to make changes or additions to their elected fringe benefits such as health insurance, unemployment benefits, or retirement plans. Employee benefits plan enrollment goes well with clear communication, a strict schedule, and insurance providers who can support HR through the process. Without the right tools, however, it can be a major headache.
2. When Do Most Companies Have Open Enrollment?
The open enrollment period differs for every company, but it typically starts 1-2 months prior to coverage. If a company is on a calendar year plan, benefits coverage often kicks off January 1, so open enrollment would start November 1.
Keep in mind that some states have their own enrollment platforms for health insurance, so be sure to review your state requirements.
3. How Should You Prepare for Employee Benefits Plan Enrollment?
Getting organized ahead of time will help streamline your open enrollment process. HR should:
- Obtain renewal numbers and rates from your carriers for the coming plan year.
- Analyze costs and decide whether you’ll switch carriers well in advance.
- Communicate with employees about any changes this year (especially pertaining to the Affordable Care Act) and prepare them for the open enrollment process.
- It’s impossible to make smart decisions about benefits without data. Paycor’s HR software allows employers to access status reports to see the progress of the current open enrollment, compare coverage costs from different years, and gauge how employee election trends change from year to year.
4. What Should You Do During an Open Enrollment Period?
- Be explicit with your employees on when the enrollment deadline is.
- Share details about the current plan so that eligible employees can use that as a guide to make decisions as to what they will need in the new plan year.
- Collect all the relevant information from your employees.
- Update payroll with the new deductions.
- Notify your carriers of changes and new enrollments.
5. How Can You Overcome Common Open Enrollment Challenges?
Many HR departments face serious administrative problems during employee benefits plan enrollment. This is often due to a few common mistakes. Here’s how to avoid them:
- Go paperless. Why aren’t you starting electronically? After all, employers build their plans online, and their employees sign in to make their elections at home, in the office, or anywhere. Paycor’s Benefits Advisor allows employees to view benefit plan summaries and other documents, receive updates on uncompleted enrollment tasks, and review how their elections will affect their compensation.
- Eliminate unnecessary data entry. Once employees have made their elections, HR has to input all of the updated information into their payroll system, which poses the risk of human error. Since Paycor has a single system of record, which means no double entry, saving time and vastly reducing the chance of error.
- Enjoy seamless connectivity to carriers. After employee elections are updated in your system, you still have to notify your insurers. Paycor pushes enrollments directly to carriers, so there’s no need to update this information in multiple places.
6. Is One Open Enrollment Conversation Good Enough?
According to a recent survey, 86% of employees are confused about benefits (Business Solver). Employers can address this by communicating about benefits throughout the year – not just during open enrollment. The subject matter is complicated and outside many employees’ areas of expertise.
Think of this as a training module or even an internal marketing campaign. A robust communication strategy can empower your team to make the best possible choices about benefits. Communicate with employees over as many channels as possible, such as:
- Company intranet
- Newsletters
- Posters and banners
- Paycheck inserts
- Webinars
If you’re sending out information electronically, make sure you have current personal email addresses on file so that employees, especially remote and frontline workers, can access the details of the health insurance plan at home.
7. As the Employer, What Am I Legally Required to Do if an Employee Misses Open Enrollment?
Employees are legally responsible for completing their own benefits elections during open enrollment. If an employee doesn’t sign up during the open enrollment period, they won’t be able to be part of the initial plan offering.
However, if they miss the window, there are other ways for them to utilize the benefits offered by the company. For example, they might qualify for certain special enrollment periods. If they experience a major life event, a change in their household income level, or the loss of an existing health plan, they might be able to enroll at another time of year. Any one of these events will typically trigger a 30-day window in which they can enroll in the company’s benefits plan.
Employees can also seek short-term health insurance outside the company’s offered packages. Short-term plans provide them with a health insurance plan if they miss the open enrollment deadline. These plans give employees more flexibility, enabling them to get limited health coverage.
Still Have Questions?
To learn more, you can join us for a live or on-demand webinar about benefits. These sessions will teach you about the enrollment process, mandatory and non-traditional benefit options, and compliance requirements. You can also download The Complete HR Benefits Toolkit for practical tips on how to design a benefits package.
Paycor’s Benefits Advisor supports HR through every step of employee benefits plan enrollment. This robust, user-friendly tool empowers you and your whole team to make the most of open enrollment.
