Getting 'The Benefits Story' Right
As open-enrollment season approaches, employers might want to reflect on whether their efforts are taking into account the life stories of employees.
By Carol Harnett
People like my friend and colleague, Bonnie Pang (a senior vice president of employee benefits for Oahu-based Atlas Insurance Agency), taught me more than a decade ago about how Hawaii, in 1974, became the first state in the union to set minimum standards of healthcare coverage for workers. And, Pang pointed out, as the nation's leader in the number of intergenerational households, how Hawaii has much to teach human resource executives about how caregiving and long-term-care insurance impact employees.
One of the greatest experiences I've gained from my time in the Aloha State is this opportunity to "talk story" with my Hawaiian counterparts. Their art of sharing information and storytelling expanded some of the ways I consider employee benefits -- and particularly how I communicate. In fact, Pang invested several hours with me during my first visit to explain the Prepaid Health Care Act so I had context for how other benefits fit into the Hawaiian health-and-welfare landscape.
I find myself reflecting a great deal lately on how we can give employees context for the way they think about their benefits options -- particularly as open enrollment season approaches.
That may surprise some of you, given how much discussion is taking place around benefits enrollment, benefits communications and choice architecture. Don't misunderstand my concern. I appreciate the nuances associated with everything from framing language to regret lotteries. But I think we're missing something more basic. I believe we're missing the art of how to talk story about employee benefits.
Let me explain what I mean using examples from my own life.
When I entered graduate school, I was awarded a teaching assistantship. This scholarship paid for my classes, provided me with a salary and gave me medical insurance. As I reflected on how to budget expenses for the year, I realized I could lose everything if something happened and I was unable to teach the two undergraduate labs my grant required.
I pictured having to go to my parents for help (an abhorrent thought for someone as fiercely independent as I am). Part of me knew my folks would come to my aid. But another side of me understood this would financially strain my family and limit what my parents were doing for my younger sister. So I took out a disability insurance policy (which I still have today). An unusual move for a 22-year old, but this ability to put my situation in the larger context of my family influenced my first benefits selection beyond healthcare coverage.
Fast forward to the last five years. I've operated my own business during this time frame and created my benefits package. I started out with health insurance, selecting the top-level plan. Having worked at some of the best medical facilities in the United States, physician and hospital choice is important to me and I'm willing to pay the extra premiums.
But, once set for medical care, I stopped and considered my benefits structure within the story of my life. When I did, three things became vitally important to me: disability insurance, long-term-care coverage and retirement savings.
I calculated how long I could cover my expenses if I became disabled and understood if I didn't increase my benefits plan, at some point, I'd have to go to my family for help. So I increased my coverage to protect my family.
After my mom died last year, I reflected about the expenses associated with the last few years of life. I pictured my young nephews -- who may wind up being responsible for me -- and knew I needed long-term-care insurance to remove the potential financial burden related to any complicated assistance I might need at some point.
Finally, I reviewed my retirement savings. Given lessons from my parents from the time of my first job, I executed a plan that leaves me reasonably well set for my later years. I shouldn't have to turn to family and friends for help. But, just in case, I continue to add to these benefits.
As I review the current use of behavioral economics and choice architecture for employee benefits, I realize we are leaving out the story of employees' lives.
If I designed an open-enrollment tool, the first thing I would have employees do is upload photos of key people in their families. I'd then ask them to consider various life scenarios in the context of the impact on their loved ones.
If the employee is a young, single dog owner, pet insurance might become a benefits selection. Heck, I met a psychologist who consults on benefits communication. He was able to increase the purchase of disability insurance by millennials with a three-minute video that asked, "What would your dog do if you weren't able to work?"
While I've personally rejected dental insurance as part of my benefits package, it might make sense for a 32-year-old mom with three kids, a limited family income and a poor family dental history.
Finally, if I were a human resource executive, once workers understood their benefits stories, I'd help them find the best way to fill in the blanks.
I recently spoke at the Mid-Sized Retirement & Healthcare Plan Management Conference in Boston. Kris Gates, another speaker and the vice president of marketing and consumer experience at MassMutual Financial Group, shared the headline comment from their consumer studies: "Don't tell me what to do, show me how to do it."
How can we help employees make their benefits stories fit their wallets? Can we show them from their history how they don't take advantage of a selection in the way they hoped? (Tom Sondergeld, senior vice president of benefits and well-being at Deerfield, Ill.-based Walgreen Co., pointed out during our presentation on private exchanges that 55 percent of Walgreen employees who chose dental coverage hadn't filed a claim in two years.)
As HR leaders, you once again are in a unique position of influence. Consider how to assist employees with telling the stories of their benefits lives. They may wind up living happily ever after.
Carol Harnett is a widely respected consultant, speaker, writer and trendspotter in the fields of employee benefits, health and productivity management, health and performance innovation, and value-based health. Follow her on Twitter via @carolharnett and on her video blog, The Work.Love.Play.Daily.
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