Step-by-Step Guide to Employee Health Benefits Renewals
Employee health benefits renewal time may not be something that business leaders look forward to: too often it’s time-consuming, stressful and confusing. But it doesn’t have to be! Let’s look at what should be involved in a renewal experience built around your needs.
1. Review Past Performance of Your Employee Health Benefits Plan
First and foremost, a good employee health benefits renewal needs thoroughly analyze what has happened since your last renewal.
Prescription drug claims can be a good example of how to make the most of your renewal. It’s not just about whether the total cost of the claims has gone up, but what the claims are for. Are there certain classes of prescription drugs that account for a significant amount of the total? Where are the drugs being dispensed and at what cost? Are there a few claims for very expensive “special handling” drugs that have significantly affected your claims experience? Your broker (at GroupHEALTH we call these experts “Advisor Partner”) should be able to identify trends or red flags in your prescription drug spend.
All other aspects of your plan should be thoroughly reviewed as well. Examples include:
- The type and frequency of paramedical claims: are your employees using a disproportionate amount of one type of coverage?
- The average length of a long-term disability claim, and why it’s this long
- The split between major and restorative dental claims
- How much vision care your employees have needed
- Whether you’ve experienced critical illness claims
Your entire claims history should be examined carefully. Knowing what’s happening in your plan now will help you figure out how to move forward.
2. Look at Changes to Your Organization or Circumstances
Next, it’s important to look at your employee composition and your company’s own circumstances. Have there been any significant changes to the demographics of your organization? Are you seeing a trend of a younger workforce as many of your older workers retire? Have you increased or decreased the size of your workforce substantially?
These are all important factors because if the makeup of your organization has changed your employee health benefits plan may need to change as well.
Looking at your company’s own circumstances is also important. Are you able to sustain the plan in the current state or do changes need to be made to meet your budget? Has it been a very good couple of years and you want to reward employees by expanding the scope of your benefits coverage? Plan renewals can be the right time to get an updated picture of your workforce and your company.
3. Identify Challenge Areas in Your Claims Experience
After a thorough analysis, you should work together with your Advisor Partner to identify challenging (or potentially challenging) areas of your plan. You should also be aware of significant changes to the employee composition. Once you’re both on the same page, you’ll be able to prioritize the most important issues (if there are any) and where you are willing to make changes.
Once these issues are identified then you can work with your Advisor Partner to make sure that you’re monitoring your plan through the year. It’s important to know if the changes you made are making a difference.
4. Look at New or Different Options – Challenge the Status Quo!
Your Advisor Partner can help you the best value, give you the best services and be a resource to you as you sponsor an employee health benefits plan. They’re also meant to bring you new and different options that you may not have considered.
For example, if you’ve identified that prescription drugs are causing your premiums to rise, your Advisor Partner should bring you options to control your drug spend. For example, GroupHEALTH has Smart Rx Prescription Drug Plans that are creative ways to manage prescription drug costs and can be implemented at any time.
If the length of your long-term disability (LTD) claims is a sore spot, does your current plan include disability management services to help get employees back to work quickly and safely? Should you adjust your contribution levels or formulates to reflect your current budget? Again, these are great examples of options your Advisor Partner should bring forward.
A good Advisor Partner will challenge the status quo. They should educate you on market trends that could affect your plan now and in the future. They should present you with options. And an Advisor Partner will advocate on your behalf when you’re not receiving full value from your plan.
Finally, a successful renewal doesn’t start with a once-a-year meeting. You should have dialogue throughout the year with the team supporting your benefits plan. If you review claims and trends several times a year, you’ll have a better handle on the plan. That way if you need to make changes you can, and you’ll know what you can expect at the next renewal.
5. Talk to the Right Advisor Partner
Are you looking for help or advice so that you can have better renewals? Review your options with one of our licensed advisors on the phone or in-person or contact us for a comparison quote.