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The new rules of benefits communication

A playbook for helping your clients craft and deliver targeted messages to employees

By Elisabeth Boone, CPCU

It's almost 2014 … do you know where your clients are in their efforts to tell employees what they need to know about their benefits under health care reform?

Communicating benefits information is a major challenge at the best of times, and that challenge is intensifying as we move toward implementation next year of the key provisions of the Patient Protection and Affordable Care Act. As that time draws near, employers are looking to their agents and brokers to help them create and deliver benefits communications that employees can understand and act on.

That's a tall order, and agents themselves are seeking guidance in this complex arena. At HNI, an all-lines brokerage with offices across the Midwest, benefits communication is a multi-front endeavor that requires focus, discipline, and a keen grasp of what employees need to know and how they want to have information communicated.

Gone are the days when employers could use a one-size-fits-all approach to benefits communication—each year distributing to their work force a fat, jargon-packed compendium of facts about premiums, deductibles, co-pays, and exclusions. Even then, most employees stuffed their booklet into the back of a drawer and didn't take it out until they needed to file a claim.

Today, says Mike Natalizio, president and chief executive officer of HNI, employers are challenged to create messages that are appropriate for the different segments of their work force, and they must communicate benefits information via multiple channels, including blogs and social networking. That's a specialty at HNI, which describes itself as a nontraditional brokerage dedicated to helping its clients achieve risk clarity and a high level of employee engagement (see "Changing the Game in Benefits" in the April 2011 issue of Rough Notes).

"We're challenging our clients to humanize their companies and humanize their communications, especially when it comes to benefits," Natalizio says. "Benefits communications tend to have a lot of legalese and a lot of acronyms. They're confusing and hard to understand, and they often fail to engage employees in their company's benefits offerings."

The fear factor

"With the advent of health care reform, we're seeing employers holding back on benefits communication because of fear," Natalizio remarks. "They fear making decisions about benefits because they're uncertain about the impact of health care reform, and they fear communicating with employees because they don't want to provide incomplete or erroneous information. Instead of keeping the lines of communication open, many employers are shutting down," he says. "They don't know what they should say and what they shouldn't say, so they don't say anything."

This fear and the resulting inaction, he observes, creates a vacuum that breeds rumors, speculation, and dissatisfaction among employees. As morale declines, so does the workers' level of engagement with the company and with their jobs. "With the implementation of health care reform on the horizon, many employers are saying, 'I'm going to wait to communicate until I know all the facts,'" Natalizio comments. Employers do need to make some weighty decisions, he acknowledges, and making the wrong decisions can be costly—but the decision not to communicate with employees can carry a high price tag.

To help its clients become comfortable about communicating with employees, HNI encourages employers to develop a strategy that promotes an ongoing flow of communications, rather than waiting until all health care reform measures are actually implemented and their full impact is known. "Sometimes an employer has to deliver bad news—layoffs, increases in health insurance premiums, coverage reductions—but communication shouldn't be used only to convey negative information," Natalizio asserts. "Employers need to communicate in an authentic and timely manner about good things, neutral things, and bad things. Employees can sense when their employer is holding back information or trying to sugar-coat bad news. We encourage our clients to get into a rhythm of short-form, conversational communications so that important messages aren't dropped like bombs onto employees."

The advent of health care reform complicates an already challenging employee benefits dynamic, Natalizio observes. As group health premiums continue to escalate, employers are being forced to increase employee contributions, raise deductibles and co-pays, and even reduce coverage. As the traditional employer-paid benefits structure erodes, many companies are filling the gaps with a suite of voluntary products so employees can choose those that meet their needs and pay for them via payroll deduction. In addition to the conundrum of health care reform, Natalizio points out, employers today have plenty to talk about with regard to their benefits offerings.

A new dynamic

To inform and engage employees, Natalizio says, "Employers need to rethink their whole benefits communication strategy. They need to determine what to say, who needs to hear it, and how to deliver it. These factors are critical to effective communication, because employees today are more skeptical as they see their benefits decreasing and their premiums rising. As employers begin to provide information about health care reform measures, employees are going to have their radar up," he says. "They're going to be saying, 'Okay, here it comes. How much more of the cost are they going to shift over to me?'"

In this atmosphere of uncertainty, Natalizio says, "It's enriching and authentic for an employer to tell employees: 'We don't know yet what we're going to do; here's what we're exploring.' The key is to keep employees in the loop so they know their employer is doing something."

In crafting a benefits communication strategy, Natalizio says, "We encourage our clients to align their internal communication strategy with their external communication strategy. Just as they build trust with a customer externally, they should do that internally with employees. Telling employees they're going to pay an extra $150 a month is not communication because it's a one-sided directive. The goal of communication is to build trust and promote engagement. Over time, employers can change the way they communicate with employees. By using more transparent tools like blogs and social media, they can start to shape a message about what their culture is like. Instead of a patronizing message from the CEO, employers can deliver bite-size communications that support the company's goals and culture," Natalizio says.

Just as companies regularly undergo financial audits, he comments, so should they audit their employee communication efforts to see if they are achieving the desired results and if they are consistent with the company's external communication strategy.

To help its clients see where they stand on this vital issue, HNI conducts an Internal Communications Assessment that encompasses five areas of evaluation:

Evaluation Area #1:

Alignment of internal and external communications

• Do internal and external perceptions appear to be aligned?

• Is there an equal investment in external and internal messaging?

• Do employees feel like your company is a great place to work?

• Is someone charged with maintaining consistency of messaging?

Evaluation Area #2:

Clarity of internal communications

• Do you use benefits jargon?

• Do you explain any terms people may not be familiar with?

• Do you make use of case studies and examples?

• Do benefits communications guide people toward making decisions?

Evaluation Area #3:

Accessibility of information

• Are communications efforts continued year round?

• Are your communications concise and easy to scan?

• Do you use an internal social platform to communicate?

• Do you use a variety of channels to reach the broadest possible audience?

Evaluation Area #4:

Focus of internal communications

• Do you explain "why" you're offering your benefits?

• Do you use case studies or testimonials internally?

• Do you conduct employee surveys?

Evaluation Area #5:

Targeting of messages internally

• How often do employees receive messages that aren't relevant?

• Is there potential to better segment communications?

• Do you use survey data to improve the focus of programs?

Sources for the assessment are a survey questionnaire and documents such as the employee handbook, employee newsletter, insurance renewal communications, and responses to employee surveys like wellness questionnaires. Each question in the assessment can be answered "Yes," "No," or "Unsure." Based on the client's responses in each evaluation category, HNI presents its observations as well as ideas for ways the client can improve its benefits communication strategy.

Target the message

Bombarding employees with flyers and e-mail messages can cause them to tune out, says Andrea Tarrell, HNI's marketing director. She presents some simple steps an employer can take to get and keep employees' attention:

Ask people what they want to hear about. Conduct a brief survey to find out what topics people are interested in and use the responses to target communications.

Communicate employee benefits through multiple channels. People consume information in different ways. Experiment with different media—mailers, e-mails, lunch 'n' learns, microblogging—to appeal to a broader group.

Use enrollment data to target your message. Tap into this gold mine of demographic information to target communications to different segments of the population.

Use "personas" for communicating benefits. Develop a variety of personas that describe typical employee sub-populations, for example, older employees who are preparing for retirement or recent college graduates. Develop communications that explain how these and other sub-groups can take advantage of specific benefit offerings.

As HNI's experience demonstrates, an ongoing flow of targeted, relevant messages, delivered via multiple channels, can be a vital step in building employee trust and engagement in their employer's benefits offerings.

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