Open Enrollment With a New Twist

Mercer PeoplePro Blog Open Enrollment

Open Enrollment Season — It’s Here!

Sorry to interrupt on Friday but if you haven’t started to give serious thought to your company’s open enrollment benefit program, time is running short.

As you turn your attention to updating your benefits program you may also want to consider plans that focus on Employee Assistance Programs (EAP) that encourages a culture of well-being.

Open Enrollment With a New Twist

Yes, we can hear you — and we know you don’t have the HR staff to spend a bunch of time on benefits, or for that matter, HR itself. But open enrollment is an important event, both from a cost management and an employee engagement standpoint. It doesn’t have to be a resource drain on you, and it shouldn’t be a hassle for employees.

First, a little about what open enrollment is. Technically, open enrollment is an employee’s annual opportunity to select benefits in what’s called a Section 125 plan, maybe better known as a cafeteria plan. IRS Section 125 is what allows benefits deductions from an employee’s paycheck to be paid pre-tax.

Detailed Regulation

Usually small businesses don’t have complex benefit plans that involve a lot of choices because the administration involved doesn’t make sense. But it’s common to at least provide some simple options, for example, to opt out of certain benefits if an employee doesn’t need them (maybe they’re covered under their spouse’s medical plan), or to select higher levels of coverage if needed (like for life insurance). There are IRS filing and other documentation requirements involved with starting and maintaining a cafeteria plan, along with some very detailed regulations, that Mercer PeoplePro experts can help with.

Open enrollment for benefits is important because every employee has different benefit needs. I’m sure you’ll agree that benefits are expensive—as a small business, you don’t want to pay for coverage your people don’t need or use. And, since benefits are expensive, you want employees to get and appreciate the value they provide. Open enrollment is really the primary way employers have of, at least once every year, engaging employees in their health, financial needs, as well as in their total rewards package.

Why Start Now?

It’s smart for your business to start thinking about your benefits now. Making changes is easier when you’re not at the end of the year and can only react to cost increases or vendor issues, likely having to make some quick and unpopular decisions—then communicate them on a shoestring.

There’s an even more important reason. Today, private exchanges are now a very viable option for benefits enrollment and delivery. These are very different from the public exchanges you hear about on the news. Private exchanges are run by consultants, brokers and health plans. They provide small businesses the opportunity to potentially provide a much wider array of benefits and administer those benefits completely online, at a very reasonable cost. In many cases, the broker or consultant will take over much of the day-to-day administration that you now do yourself.


HR Expertise On Demand

If you’re interested in learning more about open enrollment or need help on anything related to benefits for your organization, our PROs are standing by and ready to help. Schedule an appointment today at Mercer PeoplePro — we’re standing by and ready to assist.


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