For HR professionals around the country, the beginning of Summer means that it’s already time to start thinking about your next open enrollment period. This means looking at your current benefits plan, making adjustments, and trying to quantify the differences between this year’s benefits plan and next year’s benefits plan. This can be a daunting task when done appropriately due to the massive scope of the project. In a matter of weeks, you need to:
In addition to being time-consuming, this can get expensive. Hiring an actuary to analyze one plan design, for example, can cost thousands of dollars. If you want to compare three options to give your organization a holistic picture of their options, the cost can be staggering. That’s why we recommend leveraging a health analytics tool that has plan design analysis features built-in.
As you analyze your current benefits plan design and start to make changes, we want to help you stay on track. That’s why we’ve put together four simple checklists that can act as guideposts to keep you focused on what’s most important.
The first thing to consider when running a plan design analysis is looking at your current plan as it exists today. You want to make sure that you’ve made all of the decisions below deliberately. It’s okay if you don’t have a benefit listed below, but you need to have a deliberate reason for not including it.
Here is a simple checklist of questions that you should be able to answer if your current plan is well-defined.
For most HR professionals, that checklist is a breeze. You should know all of the answers to those questions without doing much homework. If that’s you, congratulations! You’re ready to run a needs assessment on your benefits plan.
Next, you’ll want to conduct a needs assessment on your current benefits plan to identify areas where you could improve. This is vital, because an optimal benefits plan covers what employees want to be covered, while also understanding what benefits may not be necessary depending on your population. This is a very delicate balance, and when done poorly, can result in having a population that is woefully under-covered.
To prevent under-covering your population, complete all of the following items before revising your benefits plan.
Once this is done, you should have a comprehensive list of items that you should add to your plan. Make a list of any needs or wants that have arisen and compare that list to your current benefits plan. Now, you can craft and compare benefits plans to determine the best fit for your organization.
Now that you have a comprehensive understanding of your current plan, in addition to a full view of areas where you could use additional coverage, it’s time to design some new benefits plans. The objective here should be to provide a menu of options to your organization, with a complete understanding of the costs and benefits of each. Ideally, you would design “small” plans that are designed to cut costs, “medium” plans that are designed to keep coverage similar, but optimize around the edges, and “large” plans that are designed to increase coverage.
Here’s a list of three things you can do to provide your organization with a strong menu of options.
Once you’ve completed these tasks, you’re ready to compare your benefit plan designs to the rest of your industry
Finally, as you dial in your benefits plan, you want to compare your plans to your competition.
Here are three things you can do to identify how your benefits plan stacks up against your competition.