The numbers don’t lie: employees aren’t engaged with their benefits. Three in five employees don’t understand how to use their benefits, and they don’t trust their employer with their health information. As a result, companies estimate that more than half (53%) of their healthcare spending goes to waste.
The simple truth is that benefits are an afterthought for most employees — that is, until they need to use them. So, how can HR start improving employee engagement with benefits options? We went to the experts to find out.
Our CEO, Amanda Lannert, moderated a panel of three HR and benefits leaders at Engage 2022 to get their thoughts on how organizations can drive greater employee engagement and deliver more value. Joining her were John Hosea, Vice President of HR, Benefits, Operations at Health Care Service Corporation; Ed Ligonde, Executive Vice President at Nielsen Benefits; and Sarah Erzinger, Director, Benefits, Global Total Rewards at McDonald’s.
In case you missed it, catch up with the full recording here. We’ve also highlighted some of the main takeaways from our speakers below.
What are the key benefits challenges that companies are facing today?
The first challenge is communication. Ed observed that with everyone working remotely, there are fewer channels for information communication and collaboration. Try as we might to mimic the office virtually, the best, most meaningful, and personal form of communication is in-person.
“[Communicating remotely] was a big hurdle for us. But at the same time, we believe that you choose which lens you view life through. So, we wanted to see it as an opportunity, so we’re working to figure out how we can increase engagement between employers and their employees.”
Sarah noted that triaging all the employee requests has been difficult. Since the pandemic began, employees have been more open about their need for benefits. She remarked, “We always knew what the opportunities were, but it was fascinating to see vulnerability from people coming forward and saying ‘I need this from you as my employer.’ We haven’t had that before — either the feedback channels or the flood of requests from employees.”
“They’re asking questions about what’s available to them. Their most common struggles are mental and financial. They’re asking about our EAP, including how many visits they get and how they can access it. They’re asking about whether we can help their spouse who lost their job — whether we have financial advisory tools, budgeting tools, or 401(k) and hardship loans.”
John commented that the two biggest challenges that he’s seen have been uncertainty and complexity. “A week doesn’t go by that something doesn’t change. From one day to the next, we don’t know what new legislation is coming or what the pandemic will bring. Not a single day has gone by that employees haven’t asked a million questions: Do we have to come back? When will we come back? What will it look like? What are you doing to keep us safe?”
In responding to the complexity, John commented that the best approach is to keep it simple. “We need to communicate frequently, communicate with clarity, and try to bring as much certainty and simplicity to our lives and the lives of our employees.”
Why is it so hard to get employees to pay attention to benefits?
What’s holding employees back from thinking about their benefits?
John said, “Engagement is at the heart of our strategy. We do everything we can to drive engagement.” But communication isn’t enough, because there’s too much information available everywhere, he observed. “People can’t consume or retain it all. That’s why repetition, clarity, and simplicity are so important.”
It’s also important to engage employees at what John called “the moment of truth,” when an employee needs to know what benefits are available. Organizations must be prepared to make the right information available at that precise moment.
How can companies control their benefits costs?
Ed remarked, “I wouldn’t wish a pandemic on anyone, but it did force employers to look at one of their biggest expenses to determine the return on their investment and the employee engagement they’re getting out of it.”
But Ed also noted that employers need to know that products like health and dental plans are a means to an end and don’t offer an actual solution.
“We’re just throwing product at a problem and not trying to figure out the why. If we want to enhance the employee experience, offering a medical plan isn’t the way to do it.”
Instead, employers should think about how they can help their employees and their family members deal with a diagnosis and make the best decisions.
He also suggested that employers might want to consider community providers who might offer high-quality care at a lower cost than big names. “People need to stop associating the price tag with quality.” Whatever choices make, employers have to consider it carefully. “They need to unpack their solution, figure out why they’re offering it, look at their demographics, get feedback from the team, and then start putting their offering together.”
What’s next for employee benefits?
Many employers are focused on elevating the employee experience, and McDonald’s is no exception. Sarah believes that poor employee engagement stems from a lack of investment in the employee experience.
“Employees often believe their employer is trying to pigeonhole them into a plan, so there’s a lack of trust. That’s why people look to their peers or managers instead of our tools. That’s why we’re going to step up our game in the experience area in 2022. It’s not about offering everything under the sun. It’s about connecting with people in the moments that matter.”
McDonald’s is also studying cost containment and reinvestment opportunities. Sarah remarked, “We’re always thinking about how to reinvest dollars, not just save them. We’re looking holistically at our benefits and reward programs and doing some benchmarking and auditing work to see where we are and aren’t competitive. We’re figuring out where value sits and where employees are engaged in programs and whether we need to do something about their lack of engagement.” She explained, “It’s not about tweaking the medical plan, deductibles, or out-of-pocket maximum. We’ve moved past the design and shifted into the engagement and experience era. It’s about finding the right value to add to the total employee value proposition.”
John is similarly hyperfocused on the employee value proposition to maximize engagement.
“I don’t think it’s that employees don’t want to engage — it’s that they don’t know how to engage because they don’t know about benefits programs. It’s about how we get better at point-in-time knowledge. We’ve got ALEX and other tools that we use to direct employees. But if they don’t know where to get those resources, we’re dead in the water. We’ve got to find new ways to get that information in the hands of our employees, whether that’s gamification or some other way that’s simple, engaging, and lighthearted.”
Driving Employees’ Benefits Engagement in 2022
If your current communication and engagement strategies aren’t boosting benefits engagement, something needs to change in 2022. To hear more suggestions from our panelists for how you can drive more employees to your benefits program, check out the replay of this lively session.