Why Do Employees Make Bad Decisions at Open Enrollment?
Open enrollment is a stressful time for employees and human resources. With the wealth of information available, it can be frustrating to see employees make poor decisions regarding their health care. Every employee has unique needs and there is often a plan that corresponds to their specific health situations. Unfortunately, 80% of Americans pick a health care plan that is incongruous with their health needs.
The reasons for this are obvious when considering the statistics:
- 83% of employees spend less than an hour researching their options for open enrollment
- 92% select the same benefits options as the year before
- A meager 4% know the meaning of health care terminology such as deductible, coinsure, and out-of-pocket maximum
Considering open enrollment is so important, it seems downright irresponsible for employees to be so flippant about their health care options. However, it’s not a lack of care that drives their poor decision making; it’s stress and intimidation. The multitude of options and the confusing terms overwhelm employees so they default to whatever option looks most similar to what they had the year before.
The problem with mismatching benefits with actual needs is that employees end up over- or under-insured. Excessive insurance can lead employees to seek unnecessary tests and procedures that inflate claims and increase the cost of healthcare for the entire organization. Limited insurance can bankrupt an employee if they fall ill and need more than basic care. They may also avoid seeking care altogether and try to weather an illness without assistance. This can lead to prolonged illness, absenteeism, and reduced workplace morale.
How to Fight Mismatched Benefits
Human Resources can drastically improve open enrollment outcomes by following the lead of industry titans like Amazon and Netflix. While healthcare is worlds apart from ecommerce or media services, there is an appeal of having a recommended for you option. Amazon and Netflix do this well and, as a result, see increased engagement. If HR took this approach to open enrollment, they could help employees shop for benefits that best match their needs.
Provide a simple survey to learn an employee’s most pressing needs and then make recommendations from there. Providing employees with a few options that correspond to their health situation is much less daunting than presenting them with an overwhelming number of plans and benefits offerings. To learn more about improving your employee benefits program, contact the experts at The Reilly Company.