The risks of using paper during benefits election season

Open enrollment is right around the corner, and brokerages can be classified in two ways: those handling enrollment on paper, and those taking advantage of tech tools to streamline open enrollment.

An online platform makes it easy to compare benefit options, reduce errors and improve efficiencies. Enrolling in coverage through a platform is more like online shopping than what most brokers typically envision when open enrollment comes around.

open enrollment
Maryland Health Connection health insurance marketplace pamphlets sit at a Community Clinic Inc. health center in Takoma Park, Maryland, U.S., on Tuesday, Oct. 1, 2013. Government-run health insurance exchanges, the cornerstone of the 2010 Affordable Care Act, opened their doors today for sales of subsidized bronze, silver, gold or platinum policies, with correspondingly higher costs. Coverage begins in January and enrollment lasts through March 2014. Photographer: Andrew Harrer/Bloomberg

Though there are many advantages to moving online, often it is risks of paper enrollment that cause people to go online. Those who had been on the fence have told us four risks of using paper:

1) It’s becoming outdated. The U.S. workforce is changing — it’s becoming younger and tech-savvier. As millennials grow in their careers and take on decision-making roles at your clients’ organizations, they are increasingly going to expect benefits to be online. They are used to handling all of their business — from banking to travel and beyond — completely online. Brokers who are able to address those expectations with a platform may have an edge over those using paper alone.

2) It makes compliance more difficult. Do paper-based processes hold up to the stringent compliance standards employers face? Brokers are increasingly being asked to provide consulting services beyond benefits, including compliance and HR. While compliance certainly can be handled on paper, it’s not ideal. Managing ACA reporting and eligibility items on paper can eat up a significant portion of time. This administrative work can leave less time for business-growing activities, representing an opportunity cost.

3) Record maintenance is burdensome. The destruction caused by the recent hurricanes illustrates how susceptible paper records are to loss. It doesn’t take a major natural disaster, either. A burst pipe, office break-in or kitchen fire could easily result in a complete loss of your clients’ sensitive information. As technology advances, this kind of risk is becoming increasingly hard to justify.

4) It perpetuates inefficiencies. If an employee makes a mistake on an enrollment form, the process for resolving that issue has traditionally involved phone calls, emails and maybe even a fax machine or scanner. This isn’t the most efficient way to manage adds, terminations and changes. Inefficiencies build up over time, and operating this way reduces an agency’s ability to do what it does best: win new business, stay abreast of industry trends and develop great benefits packages. The transactional challenges of benefits can waste time that is better spent helping your clients.

Handling open enrollment on paper may seem “safer” than investing in new technology, but the reality is that it has its risks, too. As the industry progresses, the risks associated with paper enrollment will become increasingly frustrating ­— and ultimately unacceptable — to employers and brokers alike.

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