The overwhelming advantages of an automated benefits platform
Are you still processing benefits enrollments on paper? Is your desk littered with yellow sticky note reminders? Worse yet, does the amount of paper you have to deal with cover your yellow sticky note reminders?
If you’ve already automated your benefits, you would be surprised how many organizations still use paper to process benefit enrollments. If you’re still relying on paper, consider the hidden costs:
· Studies show that up to 8% of dependents enrolled in an employer’s medical plan are ineligible to receive benefits. For a $2,000,000 benefit spend, that could add up to $160,000 a year!
· Workers typically spend around 28% of their time doing purely administrative tasks. For benefits enrollment, this means manually entering information and maintaining paper-based files.
· Simply storing paper documents is costly. Think of how many filing cabinets hold benefits documents that must be retained, plus the cost of paper, printer ink and maintenance. These expenses vary by company, but they can easily climb into the tens of thousands of dollars per year.
Even the best of us make mistakes. In school, a score of 99 out of 100 is a really good grade. With benefits, getting 1% of the total wrong means several hundred thousand dollars can suddenly disappear. Benefits are just too expensive and too complicated to manage with an error-prone, manual system. A far better choice is the many benefits administration platforms that can cost-effectively automate the process, saving both time and money.
Automated enrollment systems greatly reduce errors. Most have a rules-based enrollment engine, which means your employees only see the benefits they are eligible for and the appropriate rates for each line of coverage.
Enrollment systems are also intuitive and very user friendly, and decision support tools are getting more sophisticated. Employees answer a few simple questions and are directed towards the plan options that best meet their needs. In a world filled with apps and mobile devices, employees have become accustomed to receiving the information that they need, when they need it. Presenting targeted communications during the enrollment period is an excellent way to fulfill that expectation, reinforcing important benefit reminders and ensuring that your employees have all of the information they need to make informed, value-based healthcare decisions.
Benefits administration technology can also help with compliance. While there are regulations that require distributing hard copies to employees, you can house your plan documents, summary plan descriptions and summary of material modifications on a benefits administration platform.
COBRA rules are time-dependent and error-prone, and if mishandled can create a lot of unnecessary compliance exposure for the employer. By automating interactions with the COBRA vendor, plan administrators can ensure that all required actions take place on time and correctly.
Benefits administration platforms can also help employers track medical insurance waivers and enrollments, so they can efficiently complete their 1094-C and 1095-C ACA information reporting requirements. If a medical plan is self-funded, the platforms provide an automated and easy way to access dependent information for Part III of the 1095-C form.
There are other advantages. Administrators can easily view, monitor and approve routine benefit transactions, such as life events and new-hire enrollments. Electronic data feeds update carriers and third-party vendors without having to reenter data into numerous portals. Most benefits administration platforms are flexible enough to import employee demographic data from third-party payroll systems and export data on deductions for accurate payroll processing.
Likewise, with benefits administration automation billing and reconciliation becomes a much easier process. For self-bill lines of coverage, simple reports show who should be covered and the appropriate level of benefit. Attach a check and payment is complete.
For lines of coverage that are invoiced, reconciliation reports can be used to ensure the carrier is billing the appropriate amount. It is not uncommon for carriers to miss a term or bill for the wrong tier level. Having a system that accurately tracks enrollment and eligibility data means carrier invoices can be readily reviewed and corrected, eliminating overpayments.
In short, automating benefits administration does more than streamline workflow and save time. It’s the key to more accurate accounting, consistent compliance and significantly reduced benefits costs.
For your employees, an automated benefits platform puts benefit information at their fingertips, providing the tools and information they need to make much better healthcare decisions.