Businessolver Blog

Banana Platforms, Communication and Exchanges, Oh My!

Banana Platforms, Communication and Exchanges, Oh My!
Posted on Friday, December 19, 2014 by Natalie McLinden

We want to thank everyone who was able to attend our webinar last week, “’Tis the Season for Exchanges.” We had a great turnout, and were pleased to have Jen Benz, CEO and Founder of Benz Communications, co present with Jen Daniel, our AVP of Voluntary Products. We had great dialogue around private exchange trends along with the importance of communication, no matter which route you take. If you weren’t able to attend, take a look at the five key myths uncovered, or listen to a recording of the webinar here.


Myth #1: Defined contribution only works in a private exchange.

While defined contribution is more commonly associated with private exchanges, it’s important to note that both exchanges and benefits administration platforms are able to support defined contribution. Of course you want your employees to be good consumers of their health, but shifting that responsibility could have intended consequences. Going from the paternalistic approach where consumers think “My employer is going to make the right decision for me” to “I am now responsible for where my benefits dollars are going,” consumers feel under pressure and become distracted knowing that they have

Myth #2: Employees want to shop for benefits.

While it sounds great to have an “Amazon-like” shopping experience, the reality is that people don’t like to shop for benefits. The average consumer doesn’t know what they’re doing, is confused, and feels under pressure to make the “right decision”. Worst, we found consumers to take less than 20 minutes to make their elections. Given that one in three consumers takes a few days to research most big ticket purchase decisions, it seems like they’re going just wanting to get the process over with and not taking into consideration the long term planning and effects that should be put into such a large decision.

Myth #3: Employees want more choices!

We’re American—we love our choices and always want more! But how many choices are too many? Too much choice can easily cause choice paralysis, causing consumers to freeze up and pick what you’re familiar with because you already know it, or worse—nothing at all. Choosing insurance is an emotional choice, and when given too many choices, the pressure for people to make the “right decision” can be overwhelming. Limited time to make a choice that will affect you for the next year requires long-term planning, and adding too many options on top of that only benefits to a point for the average consumer. If all employees were benefit connoisseurs, we’d say bring on the choices, but reality is the average consumer sees a lot of choices and alongside sees a lot of work and “wrong” decisions to choose form.

Myth #4: Exchanges are the perfect fit for everyone

The truth is, there will never be a “perfect fit” for everyone. Each employer needs to evaluate their needs on a case-by-case basis, but there are a few guidelines to keep in mind. Exchanges, by nature, tend to be more black-and-white—less customizable. While you may not need a “flashy” enrollment platform, the customization goes deeper than looks. Can your exchange offer different benefits to different tiers within your company? Can your exchange answer your employees with dedicated customer service reps that are trained to know your employees language? If the answer is no, and the configurability is something your company could benefit from, you may want to consider a benefits administration platform.

Myth #5: Do I really need my employees engaged year round?

Yes!!! Engaging your employees year round will only make your job the rest of year outside of annual enrollment (because yes, there is life after annual enrollment) all the easier. 75% of HR benefits managers say that engaging employees and families year round is a top challenge. Communication is never easy, but a little bit of work can ensure that you’re doing your best to ensure your employees—and their families– are taking full advantage of the benefits that they’ve elected.


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