Michele Harmon
It is time for many employers to begin open enrollment for their employees’ insurance and other benefits for the 2025 year. Are you ready?
Have you met with your broker and rebid your current product offerings? Have you met with at least one other broker to see if your current broker continues to be competitive?
Compensation and benefits go hand in hand. Salary is just part of your most significant costs. If you think your home and car insurance is getting higher and higher, check out health insurance.
Your current and future long-term, tenured employees do care about their benefits. If they do not care, their family members do.
In the Permian, we have an influx of workers from Venezuela, Cuba, and other countries who came here for work. Employers may need to start on the right foot with these workers. These workers care about the bottom line—their paychecks—and not so much about benefits such as insurance and a 401K. However, it is your responsibility to educate them on your organization’s offerings, just as you have cause to improve their financial literacy. It will pay off in the long run.
As an extension of financial literacy, insurance literacy is a trait employees need to cultivate. It is as critical as financial literacy. You must provide your employees with coverage and assist them in understanding their benefits. Additionally, as the employer, you should have staff available to walk them through questions of how they should handle insurance decisions involving family. For instance, should they ensure their spouse and/or family or, if their spouse is employed, will their spouse’s insurance prove less expensive for their family?
Employees must also understand that open enrollment is more than just a one-and-done event for the year. Suppose your employee or their spouse experiences a qualifying event, such as job loss causing a loss in benefits. Or what about a new baby, a new marriage, a divorce, or a death? If, say, your insured child is turning 26, or if there is a change in residence to a different county, these qualifying events—and there are others to consider—could trigger an opportunity for the employee to change their current benefits.
Next, you need to offer group plan benefits to your employees. They are far cheaper than individual policies. When a new employee joins you, your payroll staff must track and meet deadlines for your group insurance enrollments and any policies your new employee might have purchased individually if you opt to run the individual policies through your payroll.
No offense to separate policies, but I suggest you let your employees buy them independently. If they change their mind about keeping them, then, since such policies are generally paid for with post-tax, rather than pre-tax, dollars, the individual can drop the policy anytime. For all coverages except life insurance (which is post-tax), policies paid for with pre-tax payroll deductions come with a condition. Should the employee decide he or she no longer wants or can afford the individual policy during the general period of 12 months between open enrollment periods, that employee has no way to drop the plan other than to resign from employment from you.
If you change carriers, will your employees’ current providers continue on the list? Have a side-by-side comparison and include a variety of stakeholders in your decision to change.
Did you do anything to get the broker to cut some costs if other costs were going up? Did you offer the choice of a traditional plan and a high deductible plan? If you provide a high deductible plan, will you contribute to your employees’ tax-advantaged health savings account?
Are you going to ensure that all your employees have a month or two heads-up on your changes and have the correct contact information for questions and concerns if there is a new set of carriers?
Did you add telemedicine? Did you ensure that all your employees know the difference between an urgent care facility and an emergency facility?
Did you add voluntary benefits at a group rate? If so, short-term disability is not part of a Covid or Flu policy. Ensure that your employees know the number of wait days before short and long-term disability kicks in and how it collaborates with Worker’s Compensation and Family Medical Leave. If you need more clarification, provide every employee with contact information to get accurate information. Most of you need to be larger to have in-house benefits staff.
Are you offering an employee wellness program? Two things are the most detrimental to anyone’s health, and we have a massive issue with both in the Permian Basin: being overweight and using tobacco products.
I will not talk about property and casualty insurance, but you should ensure a safety program that encourages driving at the speed limit and avoiding texting while driving. The other day, I got into an Uber, and the driver was watching a movie on his phone, which was prominently displayed on his dash.
Are your benefit options, as well as assistance, accessible via an online platform? If not, get with the program because everyone has a cell phone. It saves your staff’s time, and time is money.
Lastly, do you offer an Employee Assistance Program (EAP)? Life is full of stress, and toughing the hard times out only delays dealing with the roots of the problem. Ensure you have an EAP program allowing your employee access to at least three free visits. We may be in short supply of providers in the Permian, but there is also Telehealth for counseling.
The best medicine at open enrollment is educating your staff about their options so they can show up daily and be productive employees.
“Your employees are the heart of your organization.” Dr. Michele Harmon is a Human Resource professional, supporting clients in Texas and New Mexico that range in size from five to more than 3,000 employees. Email: micheleharmon1@gmail.com