Best Practices for Designing a Great Employee Benefits Program
Sponsoring an employee benefits program is a big step. It’s a long-term investment that can have a very positive impact on your employees and your company. What’s important is to get it right the first time; this can be achieved with a little prep work.
- Identify Goals for the Plan
The very first step in designing a great employee benefits program is to identify the goals for the plan. This will ensure that you’re focusing the plan design to meet those goals. Common goals for employee benefits plans include: attracting and retaining employees, rewarding existing employees and improving the health of employees. Ranking these goals can be especially helpful. Whatever they are, be sure you’re clear on your goals and how they tie into your company’s long-term plans.
- Set your Budget
Sponsoring an employee benefits plan requires a financial commitment. Careful consideration must be given to the budget so that any employee benefit plan that is introduced is financially sustainable over the long term. There’s nothing worse than introducing an employee benefit plan one year, then having to scale it back or cancel it in the following years. Consider whether your employee base will grow over the coming years, and how that will impact the cost of the plan. Leave some buffer room so that rate adjustments don’t cripple the plan, and be sure to take advantage of cost containment tools.
You should also take into account how the plan will be covered. Will you pay for 100% of the plan, or will you share the cost with your employees (for example, the company will cover 80% of the plan cost and employees will cover 20%)? Will you provide access to optional benefits so employees can purchase additional coverage above and beyond what you will provide?
- Choose Benefits that Matter
Take a look at the goals you identified at the start of the process, and then identify employee benefits that will help you meet those goals. For example, if one of your primary goals is to attract and retain employees, then you should research the employee benefits your competitors are offering. You’ll want to offer a comparable or superior employee benefit plan in order to remain competitive.
If your goal is to reward employees, then you’ll want to offer employee benefits that your employees will value. You could start by reviewing the demographics of your workforce. Millennials are known to value different benefits than baby boomers. If your workforce is primarily young and single, they will likely value different benefits than a workforce composed of families with children. Demographics are a good starting point, to give you a general direction as far as what is typically valued.
Next, you should consider surveying your workforce. There’s no better way to find out which benefits your employees will value then to ask them! Consider an anonymous survey to get the most candid results. Keep in mind that you won’t be able to satisfy everyone. Different people value different things, so the best you can do is to try to offer a flexible plan where employees make some decisions on where benefit dollars are spent.
Typically, choosing benefits that matter starts with offering health benefits. Often this includes prescription drug coverage and dental benefits. Then you can consider adding on other benefits such as life insurance, disability coverage, accident and serious illness coverage or a health spending account. The possibilities are endless and you should definitely work with a good provider to figure out the best combination for your workforce and your budget.
- Select the Right Provider
Selecting the right employee benefits provider is critical to ensure you’re getting the best value for your investment. Don’t settle for mediocre. Shop around and find a provider that is going to go above and beyond to help you deliver a financially sustainable, versatile employee benefits plan that your workers will value. You need great customer service and real people that you can turn to for support.
Look for a provider that has easy-to-use technology (for you and for plan members). Do they have online enrollment? Do they have a mobile app? You want to get the most out of your benefit dollars – see if they have any value adds. Is an employee and family assistance program (EFAP) included? Medical second opinion? Wellness support? Virtual healthcare? These “add-on’s” can often become the most popular parts of a plan.
The right provider should also have cost containment built into the plan. Do they have disability management services? Products to help contain prescription drug costs? With sustainability being the end game, you’ll need proven tools to keep your plan financially sustainable.
What Comes Next
After you’ve worked with your provider to design a great employee benefits program, you’ll need to develop a communication plan to explain the benefits and the enrollment process to your employees. Communication will likely be via a variety of mediums: meetings, intranet articles, paper handouts and more. What’s important is to deliver clear, easy-to-understand communications so that everyone is on the same page.
The actual enrollment process is next. Online enrollment is preferred because it’s easy to oversee, it prompts employees for required information and there are fewer transcription errors.
Good Advice is Key
Are you ready to introduce a great employee benefits plan to your company? Do you need help designing a plan that meets your goals and your budget? Review your options with one of our licensed advisors on the phone, or contact us for a comparison quote.