If you’re an employer with a limited budget, you may find it hard to offer employee benefits. But a quality and personalized benefits package is necessary for your organization to be competitive.
Due to an increase in unfilled jobs and remote openings, today’s workers have more room to carefully consider an employer’s benefits before accepting a job. In addition to health insurance, employees want benefits that enhance their mental and behavioral health, improve satisfaction, and support a work-life balance.
Open enrollment season offers you the perfect opportunity to determine if your compensation package meets these demands. This article outlines five key strategies for preparing for open enrollment season and showcasing your employee benefits package.
What is open enrollment?
Open enrollment is the dedicated time for Americans to enroll in, renew, or change their health coverage from the Health Insurance Marketplace. This is the only time individuals enrolled in a Marketplace plan can change their current coverage outside of a special enrollment period. Open enrollment ensures individuals don’t wait until they get sick to enroll in or switch to a more comprehensive plan.
The exact enrollment dates vary depending on which state you live in. For states on the federal Health Insurance Marketplace, open enrollment typically runs from November 1 through January 15. However, Americans must enroll by December 15 if they want their health coverage to start on January 1.
Some states with their own exchanges allow residents to enroll in healthcare coverage until February, while others have a shorter enrollment period.
If you’re an employer that offers a group policy either through the Small Business Health Options Program (SHOP) or a private insurance carrier, your open enrollment period may be during a different time of year.
Either way, communicating details about open enrollment in advance is a great opportunity to show your employees they’re valued and educate them about their coverage options.
1. Set your benefits budget
If you’re preparing to launch a new or revamped benefits package for this year's ACA open enrollment period, you must know how much you can afford to spend. Setting a budget will keep you focused and realistic as you choose your benefits.
Health benefits are often the most expensive perk to provide. But the 2022 Global Benefits Attitude Survey1 found that 60% of respondents list healthcare benefits as an important reason to remain at their current job. If you have the budget, splurging on this benefit may be a great way to increase retention.
If you’re an employer with a small budget, there are affordable alternatives to costly employer-sponsored plans. For example, employers can offer a health reimbursement arrangement (HRA), which provides tax-free reimbursement to eligible employees for their individual health plan premiums and other qualifying out-of-pocket costs.
If you employ fewer than 50 full-time equivalent employees (FTEs), you can implement a qualified small employer HRA (QSEHRA). QSEHRAs are an affordable option for small employers looking to provide their staff with a quality health benefit. They have annual contribution limits that are set by the IRS.
For employers with more than 50 FTEs and a larger health benefits budgets, consider an individual coverage HRA (ICHRAs). ICHRAs work similarly to QSEHRAs in that they are a more cost-effective alternative to group health insurance. But they’re for employers of all sizes, have no contribution limits, and offer greater flexibility by allowing customization by employee classes.
Suppose you’re interested in a group policy but want to save on premium costs by switching to a high-deductible health plan (HDHP). In that case, you can supplement your group health insurance coverage with an integrated HRA. Employees on your group plan can receive reimbursements for eligible out-of-pocket costs that your insurance policy doesn’t fully cover.
Besides health insurance plan options, you should also budget for other employee benefits you want to offer. These can include fringe benefits like paid time off (PTO), employee stipends, life insurance, wellness programs, retirement plans, parental leave, flexible work schedules, and more.
Employers pay about $11.60 per hour on average for employee benefits2. That equals almost 50% of a typical employee’s hourly wages, totaling nearly $36 per hour per employee. In total, almost 32% of the average employer’s costs go toward benefits.
These averages vary depending on your industry and how much you choose to spend, but they’re an excellent place to start when creating your benefits budget. You should consider what benefits are mandatory and what voluntary benefits you want to offer to attract and retain employees.
2. Tailor your benefit options to your employees
Open enrollment season is the perfect time to review your benefits package, as it can play a major role in reducing turnover. But this only works if your employees see value in your offerings. That’s why tailoring your benefits to include the perks employees want most is essential.
Creating an employee benefits survey to gauge your employees' satisfaction with your current benefits is a great place to start. You can also ask them what other benefits options they want to see at your company.
From there, you can review the employee feedback and determine how to customize your benefits package to meet your employees’ needs.
While the open enrollment period tends to focus on medical coverage and health plans, employees expect more when they see an updated benefits package for a new plan year. In response, 85% of employers in a recent survey are now focusing on improving their employees’ physical, financial, mental, and emotional well-being3.
Ensuring employees understand how you support them creates trust and a great employee experience. So it’s vital to collaborate with your employees to provide benefits that offer the most value for them.
Adding or changing a few benefit selections could be the difference between retaining or losing good employees by showing them you’re committed to their health and happiness.
3. Determine a communication strategy
After you choose your benefit offerings, you must communicate which benefits will be available and what the open enrollment period timeline will be for your organization.
Employees tend to value a variety of benefits. But research has found that 85% of workers can find their coverage options confusing4. So you must do more than send your employees materials and expect them to read the information at their leisure.
Simplifying your benefits options and communicating their value is an effective way to provide your employees with vital information.
Your open enrollment communication strategy should start early and span many channels, such as:
- Group meetings or town halls to discuss benefit changes and new offerings.
- Availability for one-on-one sessions with the HR team or benefits specialists to answer any questions.
- Periodic open enrollment reminders via email updates with key enrollment dates and specific instructions.
- Messaging that designates relevant points of contact for further questions and concerns, like HR, the Health Insurance Marketplace, and benefit vendors.
Using multiple communication channels helps employees make their benefit selections on time and get their questions answered.
Allow plenty of time for questions, encourage personal conversations to explore options further, and explain your benefits to those hesitant to speak up in a group setting.
If you’ve made any changes to your current benefits, share the updates with your employees and thank them for their input if you decide based on their feedback. Employee morale is positively impacted5 when your staff sees the value of their contribution and opinions.
4. Provide resources to your employees
Many employers provide resources for educating employees about their benefit offerings. These resources can include webinars, benefit fairs, email campaigns, digital enrollment materials and guides, videos, health insurance marketplace updates, and presentations.
Virtual resources are impactful because your staff can use them throughout the year, and active employees can save them for reference when the election period comes around.
For example, if you have online benefits material for last year’s open enrollment, you can make changes for 2024’s enrollment and distribute the information well in advance.
The enrollment process can be challenging for your employees. So you can consider providing an individual health insurance broker as a resource. Brokers are health insurance experts with vast knowledge about various health coverage topics, changing health reform, and rising medical care costs to guide your employees through the process.
But there are many nuances within each individual plan, so your employees may need personalized support. Be sure to provide contact information for the marketplace, health insurance carriers, vendors, or a benefits administrator if anyone needs help.
If you offer benefits with PeopleKeep, our award-winning customer support team and online help center are here to help you at the click of a button with on-hand assistance and free resources so you can offer hassle-free employee benefits.
5. Make it easy to enroll
52% of employers6 have taken action to enhance the enrollment process. With more employees working from home, virtual open enrollment is becoming the most practical option for many employers.
While your open enrollment window may be during a fixed date, it’s crucial to make enrollment in all your company’s benefits easy and inclusive for all your employees—no matter their location, time of day, or device.
The key to making open enrollment a straightforward process—whether it’s enrolling for a health benefit plan on the federal marketplace or signing up to participate in your organization’s perks—is meeting people where they are. Your benefits enrollment program should be accessible by login email via desktop, mobile, tablet, or phone.
To achieve this, you can create a one-stop benefit offering platform for your employees to find information and resources, complete the online application process, and enroll in the offerings they choose on a self-service basis.
Your virtual platform can have links to the marketplace for health insurance enrollment and a chat feature ready to answer other benefit questions. The goal should be to direct your employees to your digital benefits platform, where they can access everything they need during the enrollment window—all in one place.
Showing your employees that you are committed to their health and well-being more important than ever, and your benefits package can either reflect or detract from that commitment. By preparing early for open enrollment, you’ll have time to tailor your benefits package and highlight all your available perks, encouraging your employees to make informed decisions about their benefits.
Providing resources, communicating early, and making enrollment easy are effective strategies to help your employees navigate their health insurance market and enhance their experience throughout the enrollment window and beyond.
This article was originally published on August 10, 2022. It was last updated on August 18, 2023.