Benefits Administration Platforms

More brokers and employers are making the move to administer HR and benefits online. But before we can get into how benefits administration platforms can streamline the benefits process you might need to understand the basics of what a benefits administration platform is and all that it entails.

Benefits Administration Platforms

According to a new study from Guardian, employers are increasing their spending and adoption of benefits-related technology, largely driven by Millennials. Guardian’s Workplace Benefits Study found most employers have increased their spending on benefits tech in the last five years, and half of the employers surveyed plan to make further increases over the next three years.

These increases are driven largely by Millennials, who continue to comprise larger shares of the workforce. Millennials are looking for a more efficient and intuitive benefits experience, and as a result, the majority of employers are focusing on improving self-service platforms.

The takeaway is that small and mid-sized employers are on the cusp of a huge move to administer HR and benefits online. But brokers play a key role in helping employers adopt and implement all-in-one solutions.  Because the majority of employers want to offer benefits online but don’t currently have a platform, there is a window of opportunity for brokers who provide a solution to better compete against brokers who don’t. 

In other words, right now, offering a benefits platform as part of your agency’s value proposition is a deal-winner. But as more and more employers adopt systems, it will become a deal-qualifier, or something all advisors will have to offer.

What is a benefits administration platform?

More than $1 billion was invested in the HR tech space last year, and many of these solutions are being marketed directly to employers. With the existence of more than 100 benefits administration software solutions, it is unlikely that your clients will all choose the same solution — or even the same five solutions.

Imagine your clients are using ten different benefits administration platforms. How is your team supposed to keep up with all of the updates and improvements those ten different systems make on an ongoing basis? In an alternative scenario, you choose a platform and incorporate it into your value proposition. Your team takes time to understand the system you’ve selected. You identify how you can improve your agency’s own internal processes and who is responsible for what. As a result, you are able to more successfully implement internally and with clients.

Why are employers and brokers adopting online benefits administration?

If you haven’t taken your benefits administration online yet, here are some reasons why you should consider the move now rather than later.

Time Savings

One of the greatest benefits of bringing ancillary benefits online is the all-around time savings. Employers with paper benefits administration are spending up to an hour per enrollee completing tasks such as duplicate data entry, answering employee questions and preparing benefit packets. However, paper benefits administration isn’t just more time consuming for HR staff, employees and brokers feel the burden as well. Imagine a process that now takes you months suddenly taking you weeks.

Reduce Errors

With online benefits administration, the risk of errors is significantly decreased by reducing instances such as misreading handwriting or losing forms. The Society for Human Resource Management suggests an error rate of 3% occurs on total benefit premiums when administration is processed manually. However, with an online platform, the data collection process is automated and integrated with carriers, which will drastically reduce the opportunity for error.

Convenience & Satisfaction

These days, nearly everything is available with a click of a button – from online banking to online shopping. Similarly, online benefits administration allows access by employers, employees, and brokers to benefit information at any time from anyplace. This allows employees to include others in the decision-making process, update their own benefits when Qualifying Events occur and even answer their own questions.

With all of the changing regulations, the majority of employers and employees find health insurance plans to be confusing. By providing benefits administration online, employees are more likely to recognize the full value of their benefits. By offering better clarity around benefits and convenience, there is an overall increase in satisfaction from all parties involved.

Analysis

Online benefit administration can also be easily tracked from both the employer and the broker side. At any given time, an employer can monitor and track the progress of their open enrollment down to an individual level. In addition, if brokers have all of their clients on a single platform, they can easily track participation across the board.

By implementing a software solution for benefits administration you will see significant advantages immediately. You’ve most likely taken other aspects of your business and professional life online – it’s time to bring benefit administration to that same standard. Before you know it, you’ll be able to spend more time on your key competencies, not shifting through administrative paperwork and answering repetitive questions.

How do you buy a benefits administration platform?

If you’re like most brokers, you have never had the task of purchasing an enterprise software solution. When evaluating different products, you must decide which internal processes you will support, such as open enrollment, termination, and qualifying events, and then choose your system priorities accordingly. Software is like buying a car—there are required functions, and “nice-to-have” add-ons.

STEP 1:
Identify a Champion
This is someone at your company who spearheads research and the adoption of the technology.

STEP 2:
Pick Your Priorities
What is most important to your agency? What in particular is driving this change?

STEP 3:
Identify Your Options
Compile a list of three to four vendors that initially seem to fulfill your criteria.

STEP 4:
Compare Products
Specifically, you will want to compare features, customer support, pricing, training, and scalability.

STEP 5:
Request Product Demos
Contact the vendors on your list and request demos of their products and be sure to ask questions.

STEP 6:
Narrow the Field
Discuss with your team to narrow it down to one or two options. Write down all your questions and concerns for each option.

STEP 7:
Make a Final Comparison
Compare options and select a final vendor from your short list.

STEP 8:
Begin the Contract Process
Once the paperwork is completed, you can now begin the training, implementation and roll-out processes.

The Buyer’s Workbook

The buyer’s workbook will cover how to select a benefits administration platform and what the buying process entails. Compare different vendors’ features and ask the right questions using the guidelines provided in the workbook.

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Questions to Ask Benefits Administration Vendors

If you’re evaluating benefits administration software, you are probably overwhelmed with all of the options in the marketplace. It seems like new benefits administration software companies are popping up daily (and they are!). Your vendor should be a partner who’s invested in your mutual long-term success. But how can you tell if the vendor will be a good partner? We’ve created this list to get you started. Here are some questions to ask:

What are the future plans for your software?

Statistics show that 90% of startups fail, most within the first few years. In the benefits administration software space, the majority of vendors were founded in the last 1-2 years. This leaves significant risk in choosing a company that may not be around in the next few years. Don’t worry, there are several ways to reduce this risk and vet potential vendors.

First, ask about the company’s product roadmap. This is the company’s plan for future software releases. If the company does not have one or will not share this information with you, it should definitely be a red flag. With all of the constant changes in healthcare reform, it’s important to choose a vendor that is constantly making upgrades to their solution to adapt to the changing healthcare landscape.

Second, ask the vendor how many successful open enrollments they have completed. Likewise, if they are not willing to share this information with you – it could be a risky investment for your organization. Also, watch out for vendors who haven’t completed more than at least 1,000 open enrollments. Below that number, the vendor will not have encountered a wide enough array of benefit strategies to help avoid making you feel like a beta customer.

What HR features should a benefits administration platform have?

Next, you should ask what HR features are included with the software. While you may solely be looking for benefit admin software, it’s important to select a vendor that has the option for HR features. In fact, in a recent study, 96% of employers wanted benefit admin software that is bundled with other HR features. Functionality such as onboarding, Paid Time Off (PTO) tracking, and payroll integration should be available.

By having a single solution for benefits administration and human resources, operations are streamlined and efficiencies are gained. Reducing the number of software applications used will ultimately reduce cost.

How does customer service work?

One of the most important questions to ask about is the customer service experience. While we all like to think that issues won’t arise with software, there’s a good chance they will at some point. In that situation, it’s important to know the process and what to expect. Make sure to ask what support is provided. Is support via the phone or just web based? Will you have an assigned account manager or deal with someone different each time?

ProTip: One great way to gauge the customer service of a software vendor is to talk to their customers. Ask the vendor if you can talk to some references – specifically to other organizations similar to your own.

What does training entail?

In addition to great customer service, make sure the software vendor has an organized training process with a timeline. Once you purchase the software, do they just give you a log-in and let you run? (Red flag if the answer is yes!) Things to look for would be an on-site training in which the vendor walks you through real-time setup of your instance. When you reach out to referrals, make sure to ask about how their training went as well.

What is the price of benefits administration software?

Last, it’s time to talk price! Pricing for benefits administration software can come in many forms – from vendors offering the software for “free” to per employee and tiered pricing. (Sidenote: nothing “free” comes without a cost!) The pricing with your vendor should be transparent and you should have a clear understanding of what all is included.

No benefits administration vendor prices their software the same, and often times hidden fees make products more expensive than they initially appear. Here are some of the most common pricing structures decoded:

• PEPM:

Per-employee-per-month is a popular pricing structure for software platforms and very common in the HR software realm. Most PEPM solutions have multiple pricing tiers with various features included. When considering a PEPM software, realistically calculate how many users you will have on the platform in a best and worst case scenario. Some solutions, like BerniePortal, are only PEPM for features not included in the broker license. This allows employers themselves to take on the cost of any upgraded features they would like to take advantage of such as PTO tracking.

• Per User:

Other solutions charge based on the number of users your brokerage will have. If you have support staff or multiple producers, make sure that the pricing you’re being shown is for the correct number of licensees. Also, check to see how much it would cost to add users if you’re anticipating growth.

• Flat Fees:

Flat fees are the most straightforward pricing structure. For most vendors with this model, there is a flat fee per month which includes an array of features. A flat fee approach can often be more cost-effective than a PEPM structure if you’re working with variant numbers. If you’re looking to have all of your groups on one platform, a flat fee with no limit on groups is the most cost-effective route.

• Support Fees:

While it’s easy to assume that support would be included with your software, many benefits administration software platforms actually charge for customer support and even limit the amount of support you get for that price. Make sure you ask on the front end if support is included so you’re not slapped with a large fee the first time you have a question about your new software.

• Implementation Fees:

Implementations are very common in the software-as-a-service world. Implementation fees typically include the training and support you will need to get running on a software. This one-time fee is an investment that will get you started on your new software.

• Pricing Combinations:

Many vendors use a combination of the above pricing structures. Make sure you read the fine print and compare vendors apples to apples. While it may seem obvious, you’re not going to get the same functionality on a platform that prides themselves on being “low cost.” Think about it – vendors that advertise a solution for a few hundred dollars a month have to have hidden costs such as charging for support to cover their overhead. To avoid hidden fees, ask the following questions:

  1. What does support include and how much does it cost?
  2. How many producers can I have?
  3. What does implementation include and how much does it cost?
  4. How often do you update your software and how much does it cost?

Implementing Benefits Administration Software

You’ve picked a benefits administration – how do you implement it?

STEP 1: Implement with your team

Before implementing with clients, make sure that everyone on your team knows how to use it. For example, if you have service team members who will be using the system, make sure they are up and running before you have a client calling in with a question.

STEP 2: Implement with smaller clients

Once your team is up and running, start implementing your new solution with a few of your smaller clients. By doing this, you will iron out any issues before you implement with your largest clients.

STEP 3: Implement with all your clients during open enrollment

Once you’ve told your clients you’re going online, now what? It’s as easy as addressing each feature as it comes up. First, you’ll start with open enrollment and show them how easily their employees will enroll. If you’ve chosen a platform that is very user-friendly, there shouldn’t be a learning curve. Next, you’ll address qualifying events when they happen. By teaching clients a little at a time, you won’t overwhelm them with information.

For employers that want to learn more, make sure your vendor has additional information available. Training guides and daily training offerings are a few ways you can make sure you and your clients are in the know.

STEP 4: Train Clients

In addition to great customer service, make sure the software vendor has an organized training process with a timeline. Once you purchase the software, do they just give you a log-in and let you run? (Red flag if the answer is yes!) Things to look for would be an on-site training in which the vendor walks you through real-time setup of your instance. When you reach out to referrals, make sure to ask about how their training went as well.

STEP 5: Continued Success

Once you have implemented your system, don’t let the communication with your software vendor stop. Your vendor should be continually making improvements. To make the most of your investment you should stay in the loop. This way, you can make sure you are taking full advantage of all functionality. Make sure every time you get an email with “Release Notes” you take the time to read it.

Last, make sure you are taking full advantage of all of the opportunities your software vendor offers. Attend webinars and trainings to always make sure you know what’s going on. Have an idea for an improvement? Send it to them! You probably aren’t the only user that could benefit from such a change.

The Buyer’s Workbook

The buyer’s workbook will cover how to select a benefits administration platform and what the buying process entails. Compare different vendors’ features and ask the right questions using the guidelines provided in the workbook.

DOWNLOAD GUIDE

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