How your organization can benefit from new opportunities in the employer channel
The non-stop change and disruption taking place in the benefit space shows no sign of slowing this year, especially with the possible retooling of the Affordable Care Act (ACA) on the horizon. However, some potential shifts could be good news for those of us in the benefit space.
There is no doubt that greater government oversight of medical benefits had a dampening effect on both innovation and business performance for many carriers and brokers. At the same time, new opportunities are emerging in the industry, thanks to innovative technologies and member-engagement methods adopted from other sectors.
While these opportunities will take various forms, some of the most profitable are set to take place within the employer channel. For example, the potential removal of both the employer and individual mandates could drive greater interest in voluntary supplements to major medical coverage products—accident, critical illness, gap, and other supplemental plans. This is especially true for hourly workers who can’t afford (and often don’t value) major medical coverage, along with the deductibles and other out-of-pocket costs that climb beyond the worker’s reach.
If employees don’t face a penalty for passing on major medical coverage, many will be seeking first-dollar coverage for more common, everyday medical costs. Or they’ll be looking for benefits to protect themselves only in case of a serious accident or illness.
Whether or not the ACA is dismantled, out-of-pocket costs will continue to rise in the next several years, opening wider the door for supplemental benefit products that are designed to offset these costs.
With unemployment going down and the talent pool drying up in many sectors … it’s the perfect time to leverage the opportunities available in the workplace channel by offering innovative, tailored benefits.
At the same time, new technology platforms and engagement programs offer benefit providers a viable avenue to increase enrollment in a variety of products. These solutions streamline member experience, provide valuable insights about enrollment, and allow for proactive, targeted communications designed to retain membership.
Penetrating the workplace channel
In the past several years, carriers and brokers focused on selling voluntary benefits faced some challenges penetrating the workplace channel. HR staff were already overwhelmed with all of the requirements of the ACA related to major medical coverage, and they had little time and energy to focus on other benefits. This obstacle is likely to be less profound this year, and benefit organizations must be ready to take advantage of this shift.
However, some organizations underestimate how much is involved in successfully marketing voluntary products to employers and their workers.The “initial” sale to the employer is only one challenge to overcome. The more complex, and equally important,requirement involves engaging employees to drive enrollment and long-term retention. This can’t fall on the shoulders of the employer alone.
The following strategies can help your clients not only acquire—but keep—members who will increasingly look to enroll in voluntary benefits in the post-ACA world.
Use data to your advantage. One of the most effective strategies involves becoming more in tune with consumer purchasing patterns. If your client doesn’t collect, track and monitor enrollment data, it’s already one step behind in the process. Fear not. There are many offerings available today that integrate this functionality into benefits technology. For example, business intelligence dashboards are being used by some leading carriers to analyze enrollment trends and product preference and to identify precise opportunities for engagement.
These dashboards are integral to enrollment, engagement, and administrative solutions offered by providers like us, because they can provide near real-time insights to our clients. As a result, benefit organizations can quickly shift their marketing approach to focus on the greatest opportunities.
For example, an organization may have a population spread out geographically consisting of home office professional workers, hourly retail workers, and seasonal staff. These cohorts likely have unique product preferences and interests. If one of these groups is suddenly showing greater interest in a particular benefit package, ramping up marketing for this product is critical. Acting immediately on this insight is key, given that market trends can come and go quickly.
Timing and tweaking. Product interest can fluctuate with the seasons. Accident protection for youth sports is a prime example; carriers and brokers must keep this in mind as they promote these products to employees. However, other trends may not be standard across every book of business and can be identified by analyzing historical data and current enrollment trends through the analytical methods detailed earlier.
When it comes to product offerings, customization also is king. Employers must be willing to accept that the days of choosing a one-size-fits-all benefit solution for their workforce is long gone. Instead, savvy organizations will look for their brokers to offer more tailored benefit packages designed to fit the unique needs of each segment—from limited benefit plans for hourly and seasonal workers to executive coverage designed to help them retain C-suite employees.
Rethink design. If many of the current restrictions are lifted from the ACA, carriers will have all the room they need to optimize benefits in unique and impactful ways. In fact, many insurers are already taking steps in this direction, even for more traditional voluntary benefits like vision and dental. One of the ways to deliver greater value to employees is by ensuring the portability of benefits so that individuals can retain this coverage even after a job change.
Another method involves allowing for roll-over of certain benefits like vision coverage, that traditionally have benefit-period restrictions. Rather than limiting coverage for eyeglasses and contact lenses on an annual basis, employees can be allowed to roll over this amount if it’s not used. This helps employees avoid the mad rush to the eye doctor that often occurs before open enrollment, or the potential loss of benefits.
Features like these can help drive greater long-term loyalty and product preference.
Make buying easy. The benefit industry has lagged behind many others when it comes to the purchasing experience, both in the individual and employer channels. While the ACA may not be around for the long haul, it has made a lasting and significant impact on the way consumers expect to shop for benefits. Enrollment via online portals now is a must-have feature. And buyers expect to be able to have all types of products integrated into a single digital environment.
Consumer interest in decision-support tools is also high. These include online calculators and other resources that help individuals decide what kind of coverage to purchase and in what amount, when applicable. Consumer decision-support tools aren’t just popular with employees. They appeal to employers, too, because they can reduce the amount of confusion and questions that arise during open enrollment. Attitudes are changing when it comes to packaging benefits together. Products that have often been bundled together—like vision and dental—may be more appealing to certain populations when offered separately. In other cases, bundling a unique combination of products could make them far more impactful. For instance, carriers may put together accident coverage, critical illness, employee assistance programs, and telemedicine to create a targeted product for younger, healthier employees without high healthcare utilization.
Invest in the future … It’s well documented that the cost of acquiring a new customer (or in this case, a member) far exceeds the cost related to retaining one. As a result, it pays to invest in employee retention strategies that engage your client’s employees all year round—not just when you’re asking them to renew.
Engagement marketing can be as simple as sending out regular emails, but they must be timely and relevant to your audience. For example, if an employee has purchased pet insurance, sending articles related to pet ownership will be perceived as more interesting and will not be viewed as intrusive as sales-driven messaging. This same approach could be timely if content is tied into a specific time of year—for example, sending out tips during flea and tick season or an article about keeping dogs cool in the summer heat.
Yet, no matter what the topic, the most important aspect of these efforts is ensuring that they are data-driven, and this is accomplished by leveraging business intelligence about the population segment. Doing so will allow for the most targeted, precise, and effective outreach.
… but seize opportunity today. With unemployment going down and the talent pool drying up in many sectors, workers are suddenly expecting far more from their employers. As a result, it’s the perfect time to leverage the opportunities available in the workplace channel by offering innovative, tailored benefits.
Yet equally important, your client must be willing to invest in long-term solutions that help it keep its valuedemployees by looking to today’s technology, data analytics, and tried-and-true marketing strategies. Those approaches will give you a strong advantage over competitors looking only to sell to employers and simply walk away from the difficult—but fruitful—task of improving employee enrollment and retention.
Mike Groeger is chief revenue officer for Genius Avenue, responsible for all external affairs, enterprise revenue generation, and client services for the Phoenix-based firm that offers voluntary benefits, enrollment, and engagement tools. For more information, visit www.geniusavenue.com