by jeffp | Feb 25, 2015 | Employee Benefits
According to the Merriam-Webster Dictionary, the word “meaningful” means “Having a meaning or purpose, full of meaning, significant.” It’s a concept that’s decidedly absent in much of the retirement benefit education employers provide their workers. Sure, they may cover all the bases, from how much a worker can contribute and how those contributions can be made to the basic options for investment of their funds and tax benefits of each. These facts are important. But they’re not as meaningful as engaging employees in a real conversation about their personal future.
If you’d like to make retirement benefit education at your organization more meaningful—and therefor impactful—consider the following suggestions.
Help Them Connect with Their Future Self
It’s easy to put off saving for retirement when you’re living purely in the present, consumed by your current wants and needs. Your workers may not be thinking about how the financial decisions they make today—from buying a $6 mocha latte to taking a European vacation—will impact their future. Fortunately, you have the opportunity to help them do so.
Ask your employees to imagine their retirement. What do they see? Are they traveling the country in a recreational vehicle? Are they living on the beach or in the mountains? Do they golf every day or spend time volunteering? How do they feel? Are they comfortable, happy and content? Do they worry about outliving their money? Once they make an emotional connection with their future self and what he/she will want and need, it will be easier for them to save for retirement.
Help Them Set an Achievable Savings Goal
Without a concrete savings goal, your employees cannot create a successful retirement plan. Unfortunately, most of them have no idea how much they will actually need. One 2013 survey found that 45 percent of savers believed they were not saving enough because they didn’t know how much money they would eventually need. Seventy-seven percent said they would save more if they knew how much today’s savings would be worth in future retirement dollars.
Instead of giving your employees a daunting goal to shoot for, help them find the answer to all those “how much?” questions. One way to do this is to choose a retirement plan vendor that offers online tools to allow your employees to model potential scenarios. They can then visualize how much they will need to save based on current rates to generate the future income they want.
Help Them Factor in Healthcare
Senior healthcare can take a big bite out of retirement savings. One 2013 study found out-of-pocket health-related expenses for a 65-year-old couple could be as much as $220,000 given average life expectancy. According to the study, most savers are only planning for $50,000 in healthcare expenses in retirement.
If you help your employees understand your employer sponsored healthcare plan as well as their future Medicaid and Medicare options, you will ensure they have a better picture of the benefits they will receive and the possible out-of-pocket medical expenses they’ll have to cover on their own. They can then incorporate this sum into their retirement savings goal.
If you’d like additional insight into meaningful retirement benefit education, contact your benefits advisor.
by jeffp | Feb 11, 2015 | Employee Benefits
When it comes to engagement, employers need to think about more than salary and vacation benefits. There is an inextricable link between employee engagement and employee health. So much so, in fact, that study results often reveal that employees who participate in health programs are as much as three times more likely to be satisfied in their work.
Nurturing this satisfaction—or engagement—is well worth the cost. Research from the American College of Occupational and Environmental Medicine found that workplace health and wellness programs lead to significant reductions in lost work time—about 10.3 hours a year per participating employee. Employers also saved about $350 per year in healthcare costs per participating employee.
That’s enough to get anyone’s attention, and the use of such workplace programs continues to grow. The Optum Resource Center for Health and Well-being recently released a report on trends in workplace health management programs. Based on a survey of more than 500 human resource professionals at U.S. companies of all sizes, perhaps some of the findings—summarized below—will inspire you to create one at your organization.
- Health management programs are prevalent in today’s businesses. On average, employers offer eight such programs. The larger the organization, the more programs they offer (5.2 average for small employers vs. 9.3 at large companies).
- Employee assistance programs (EAPs) are the most common. Seventy percent of the surveyed employers offer them. Other popular programs are health/wellness websites (53 percent), health assessments (52 percent), wellness coaching (49 percent) and health/fitness challenges (48 percent).
- More health management programs are available online (81 percent). Seventy-nine percent of the programs surveyed employers used had an onsite component.
- Employers recognize the importance of establishing a “culture of health” in their organization. Sixty-two percent of the surveyed large company HR professionals said doing so is important. However, only 23 percent have actually done so.
- Program budgets remain stable. Despite economic concerns, companies of all sizes report their wellness program budget have remained stable. More than 21 percent of employers actually increased their budget last year. Nearly 40 percent plan to increase spending on health management over the next three years.
- Program administration is usually the most significant cost. This is followed by incentives, staff, communication, environment, program evaluation and other.
- Most wellness programs have been in place for at least four years. On average, at companies of all sizes, wellness offerings have been available for about four years. However, more than 40 percent of large companies have offered their programs for more than five years.
- Strategic planning is important. Nearly 50 percent of employers have established long-term strategic plans for their health management programs or—at minimum—an annual plan. Large employers are most likely to plan (73 percent), compared to midsized (44 percent) and small companies (43 percent).
- Incentives for participation are common. More than 81 percent of employers offer incentives. Most spend an average of $167 per participant per year. The most commonly incentivized program offerings are biometric screenings, fitness challenges and health incentives. Incentives often take the form of contributions to a health savings or health reimbursement account.
- Some employers reward their workers for achieving certain health outcomes. While most provide incentives to employees who complete wellness programs, 42 percent reward those who meet a health goal (such as losing weight or reducing blood pressure). In fact, the percentage of companies offering incentives for health outcomes increased from last year’s survey. The percentage offering rewards for program enrollment or completion actually decline.
- More employees are participating in the health management programs offered. Fifty-five percent participated this year, an increase from 47 percent last year. Small companies have the highest participation rate (62 percent), while participation is slightly lower at large companies (54 percent) and medium-sized organizations (47 percent).
- The success rate is quite high. Surveyed employers reported a 90 percent success rate for biometric screenings, 86 percent for onsite fitness centers, and 86 percent for health/fitness challenges.
As the Affordable Care Act continues to place an increasing focus on workplace wellness, companies across the nation are investing in health management programs. If you’d like to learn more about adding one to your roster of benefits, we’re here to help.
by jeffp | Jan 29, 2015 | Employee Benefits
During the summer of 2013, the U.S. Supreme Court heard the case of United States v. Windsor and subsequently ruled that Section 3 of the federal Defense of Marriage Act—also known as DOMA—was unconstitutional. This portion of the act had previously prevented the federal government from recognizing marriages between same-sex couples, even when those couples lived in states that had legalized same-sex marriage. At the time of the ruling, this included 12 states plus the District of Columbia. The re-legalization of same-sex marriage in California—also by the Supreme Court—soon increased that total to 13.
For employers, the United States v. Windsor decision meant changes to employee benefit plans. These changes primarily related to the definition of spouse—something every benefits plan should cover—though it has impacted a few other plan procedures and policies as well. If you’ve yet to review your plan documents to correct related issues, consider the following:
- If your company operates in a state where same-sex marriage is recognized, federal laws require you to treat same-sex and opposite-sex spouses equally when spousal benefits are offered.
- In states recognizing same-sex marriage, employees no longer have to pay federal income taxes on your contribution to a same-sex spouse’s medical, dental or vision coverage. Additionally, your worker’s can make contributions to a same-sex spouse’s coverage on a pre-tax basis under an appropriate plan.
- Businesses in states recognizing same-sex marriage must offer COBRA health insurance continuation coverage to same-sex spouses.
- If you have an employer pension plan and operate in a state recognizing same-sex marriage, it must pay surviving-spouse annuities to same-sex spouses.
- If you’re offering a 401(k) as part of your benefits plan in a state recognizing same-sex marriage, it must pay death benefits to same-sex spouses if they are beneficiaries.
- Companies in states recognizing same-sex marriages must allow employees to take family and medical leave to care for an ill same-sex spouse.
More than a year after the DOMA ruling, it is still unclear whether businesses within states that do not recognize same-sex marriage need to adjust their benefits plan policies to comply with the new federal definition. It appears these employers can choose either approach (to recognize same-sex marriage or not to do so) but their benefits plan documentation needs to explain their chosen definition of spouse clearly.
Guidance issued by the United States Department of Labor in September 2013 would seem to indicate that choosing to recognize same-sex marriages within your benefits plan could be the most prudent decision. It stated, “The term ‘spouse’ will be read to refer to any individuals who are lawfully married under any state law, including individuals married to a person of the same sex who were legally married in a state that recognizes such marriages, but who are domiciled in a state that does not recognize such marriages.”
Would you like assistance reviewing your benefits plan language? We’d love to help. Please contact us anytime you require additional insight into benefits planning and procedures.
by jeffp | Jan 17, 2015 | Employee Benefits
A 2012 study conducted by Aflac, the largest provider of supplemental insurance in the U.S., found that many of today’s workers value workplace wellness efforts. In fact, 28 percent stated that company-sponsored tools to improve health and lifestyle yield greater job satisfaction. Other research has provided statistics on workplace wellness benefits for employers. One analysis of multiple published studies found workplace wellness programs result in an average 28 percent reduction in sick days. They also reduced health costs by 26 percent and workers’ compensation claims by 30 percent.
If you’re not achieving these types of results, it may be time to improve your workplace wellness program. Doing so doesn’t have to cost a fortune, either. Consider these enhancements you can make on the cheap.
Nail down a strategy.
As Benjamin Franklin once famously wrote, “If you fail to plan, you are planning to fail.” Haphazardly throwing together a wellness program without determining exactly what you want it to accomplish—and the best methods to use to reach those goals—is never going to be very effective. Instead, think about the biggest health concerns in your workplace (you may want to survey your employees) and create a three- to five-year plan to address them.
Spend for data.
While you can develop a workplace wellness program that doesn’t cost a dime, spending a portion of even a small budget on data collection can be worth it. For example, hiring a vendor to conduct screenings will help you establish a baseline on the health and fitness level of your employees. Periodic re-screenings will help you gauge their progress and target new areas for improvement.
Take full advantage of your partners.
If you’ve hired a wellness program provider, solicit his ideas and consider his recommendations. You’re paying for his experience and expertise, so use it. Tap into your other benefits providers—from health insurers to 401(k) managers—as well. As part of their service, they may provide free resources you can use to enhance your wellness program, such as online educational tools.
Use free resources provided by government and non-profit organizations.
For example, the U.S. Centers for Disease Control and Prevention has created the National Healthy Worksite Program, which you can access online. You’ll find information on training opportunities, training materials, and other tools and resources you can use when enhancing your workplace wellness program.
Make the most of key health areas.
If you want to get the biggest bang for your wellness dollar, focus on areas of health in which small changes often yield big results. These include increasing your employees’ physical activity and improving their nutrition. For example, you might encourage them to move more with daily-steps competitions, short exercise breaks or setting up an on-site gym. You could swap healthy snacks for junk food in the office vending machine, organize a company-wide weight loss challenge, or distribute a newsletter with healthy-eating tips and recipes.
Whether you want to fine-tune an existing wellness program to produce better results or have yet to add this valuable supplemental benefit to your company’s roster, I can help. Contact me today for more information on creating and managing your program.
by jeffp | Dec 12, 2014 | Employee Benefits
You’ve probably heard the old saying “The squeaky wheel gets the grease.” It basically means that the loudest wheel (or in the case of a business, employee) will be given the most maintenance (or in this case, attention). While heeding this instruction may serve you well if you’re working on a bicycle, it could actually hurt your company’s benefits program. Why is this? The answer is simply because the desires of your most vocal employees aren’t always representative of the rest of your workforce.
The Danger of Misconception
If your employee benefits package is full of offerings the majority of your team doesn’t want, participation rates will suffer. The healthiest among them may not sign up for your health insurance plan, resulting in a smaller group (of potentially unhealthy workers) and driving up costs for your entire organization. They may opt out of supplemental benefits—such as life insurance—and increase the cost per participant of providing those opportunities. Even worse, unwanted benefits don’t enhance engagement. They do nothing to improve productivity or reduce employee turnover.
Fortunately, there are ways you can reach out to your workforce—including those who rarely speak their mind—and find out what benefits really matter to the majority of your staff.
Start With a Survey
You can use free or low-cost software such as SurveyMonkey to get a baseline reading on your employees’ opinions of your current benefits package. Basic questions you might want to ask include:
- On a scale of one to five, with one being the worst and five being the best, how would you rate the benefits package at Company XYZ?
- Given your personal situation, how would you rank the benefits provided within the package from least to most important? (Provide list of current benefits.)
- What other benefits should Company XYZ offer?
- Do you know how to sign up for benefits at Company XYZ?
- How can Company XYZ make it easier for you to sign up for or utilize your benefits?
You can require employees to complete the survey or incentivize their participation by offering a prize. Make sure your workforce knows that the responses will remain confidential and anonymous.
Consider Potential Changes
If your employees indicate they are overwhelmingly satisfied with their benefits package, then congratulations! If not, it’s time to consider potential changes based on their responses. Enlist the assistance of your benefits advisor to investigate your options. You may want to choose a new employer-sponsored health insurance plan, replace less popular voluntary insurance with new options, or add a few supplemental benefits such as a workplace wellness program or group gym membership.
Make an Announcement
Whether you’ve made changes to your benefits package or are sticking with the status quo, you need to communicate the results of the evaluation to your workforce. Statistics show that most people need to receive a message seven times before they take action. Over the course of a few weeks, use a mix of mediums to announce company benefits information. Options include paycheck envelope stuffers, bathroom and break room posters, email announcements and group meetings with your benefits plan administrator. Contact your benefits advisor for additional suggestions.
by jeffp | Nov 20, 2014 | Employee Benefits
How do you measure the success of your employee benefits program? If you’re like 62 percent of the employers responding to MetLife’s annual benefits trends survey, enrollment rates are your criteria of choice. After all, even the best benefits package will fail at increasing employee engagement and decreasing turnover if too few of your workers take advantage of it.
Fortunately, many experts agree that better benefits communication is the best way to improve enrollment rate. Prudential recently conducted its “Eighth Annual Study of Employee Benefits” and discovered several communication methods that employees continue to prefer above the rest.
- Work Email – Forty-seven percent of the employees Prudential surveyed said work email was their preferred benefits communication method.
- Personal Email – Personal email was the preferred benefits communication method of 28 percent of the surveyed employees.
- In-Person – Traditional group meetings and one-on-one meetings were the preferred benefits communication method of 18 percent and 19 percent of surveyed employees, respectively.
The employers Prudential surveyed had slightly different views on the subject. Communications methods with which they’ve had the “greatest success” included group meetings and seminars (74 percent), individual one-on-one meetings (72 percent), email (68 percent), toll-free phone number (61 percent), and mail at home (60 percent).
During open enrollment periods, 21 percent of employers noted that they had the most success with communicating benefits through mail at home. Eighteen percent had success with videos and DVD presentations, while social media networking also delivered results (16 percent).
As more employers move to a year-round communication strategy, rather than just talking about benefits during the open enrollment period, 84 percent said they plan to do so through email. This was followed by home mailing (77 percent), benefits websites (76 percent), phone calls (75 percent), and text messages (46 percent).
Based on Prudential’s data, it appears that employers who want to improve their enrollment rates would be wise to choose a mix of communication methods to suit the preferences of their employees. Surveying your own workforce is the most direct way to determine a specific course of action. While younger workers may be more comfortable with learning about their options through email, Baby Boomers or those who want additional insight may prefer the opportunity to attend group or individual meetings.
Regardless of the benefits communication method you choose, the Society for Human Resource Management suggests that you also:
- Ensure your benefits information is easy to understand. This means providing jargon-free details on available options so employees have the information they need to make educated choices.
- Personalize the benefits information to each employee’s needs.
- Provide your employees with an opportunity to talk with a benefits expert—in person or by phone—while on company time.
As the 2015 open enrollment period approaches, now is the time to make changes to your benefits communication process and earn increases in that enrollment rate. If you’d like further assistance, please contact your benefits advisor today.
