Six strategies to maximize the impact of your benefits budget | Part 2: Maximizing simplicity
Throughout our blog series, “Six strategies to maximize the impact of your benefits budget,” we share actionable tips to help HR and Benefits leaders get the most from their benefits amid economic uncertainty. In Part 1, we introduced the six strategies. Here in Part 2 we dive into the first two strategies, which increase the impact of your benefits by maximizing simplicity.
The impact of simplicity
Companies have quickly responded to evolving employee needs by offering more benefits – including access to virtual primary care, mindfulness and mental health apps, home office stipends, and more – particularly since the onset of the COVID-19 pandemic.
But the delivery of these benefits has mostly been through burdensome payroll reimbursement processes or through disconnected point solutions, many of which have expanded their services, resulting in overlap. All of this has led to mounting confusion and fatigue for both employers and employees:
For employers, each new solution means more:
- Programs to communicate and educate employees about
- Vendors to manage, each with different utilization metrics
- Points of contact for troubleshooting & support
- Sources, formats, and delivery cadence of reports
- Budget line items to demonstrate ROI for
For employees, each new solution means more:
- Cognitive load to understand all their benefits
- Apps to download
- Portals to log into
- Passwords to memorize
- Cards in their wallet
As companies look for ways to do more with less, simplifying the benefits portfolio and experience will not only increase utilization but also give HR and Benefits teams more time back for higher-value work. Streamlining benefits to meet more employee needs without requiring more point solutions is now possible through solutions built for the future, like Level.
Assessing your portfolio with an investment mentality
Simplification doesn’t necessarily mean fewer benefits. Rather, as companies are even more dependent on their employees’ productivity and engagement, it’s critical to still invest in the workforce with best-in-class benefits. But past strategies for delivering these benefits aren’t the optimal way forward.
It can be tempting to first look at benefits with low utilization and ask if that spend should continue. But the low utilization may not be an indicator of importance or value to employees. Some speciality benefits may only be used by a portion of employees at any given time, but they’re still meaningful and should be accessible for the entire workforce, as evidenced by employee survey results and feedback. So rather than a value issue, the cause of low utilization is likely a delivery issue, rooted in the fact that employers and employees will always struggle to make the most of a complex set of disconnected point solutions.
Like any portfolio manager would, acknowledge and accept that what worked in the past may not be right for the future. Then focus on identifying solutions that allow you to more efficiently use your budget and your time while still delivering the same – if not more – meaningful benefits to all employees.
Repurposing budget into more impactful benefits
A complex portfolio of disconnected point solutions is difficult to use, manage, and understand, but it’s also likely expensive. Most point solutions charge per-employee-per-month (PEPM) fees, and employers aren’t reimbursed for unused spend, making it difficult for employers to optimize every dollar across their portfolio.
Because these benefits are important investments in attracting and retaining talent, increasing employee engagement, and creating a positive work culture, a simpler and more cost-effective strategy is to repurpose the budget from this set of solutions into fewer, more flexible and comprehensive benefits. This frees the employer from the need to procure, manage and educate employees about so many vendors. And it reduces the cognitive load while improving the user experience for employees.
But it also creates levity for all by reducing the pressure on employers to find a set of solutions that covers the full range of diverse needs of their workforce. Instead, a more flexible and inclusive benefit creates an opportunity for each employee to spend allotted dollars on what’s most meaningful to them, while employers only pay for what’s used.
Strategies in action
One benefit employers commonly start with is wellness. Why? Because over the years, employers have adopted and implemented a number of wellness programs spanning:
- Wellness platforms
- Gym memberships
- Passes to fitness classes like yoga and spinning
- Wearables for monitoring exercise, sleep and heart health
- At-home fitness equipment
- Virtual classes
- Mindfulness and meditation apps
- Sports massage
Many of these programs may be line-item budgets, and many employees might want to use one or two of the programs but not all of them. By taking an inventory of the wellness programs offered, the utilization and cost, employers can identify a dollar amount that would enable employees to access the benefits that they want to use.
Additionally, medical carriers may issue a wellness credit, further motivating employers to support employees’ wellness habits. Employers should check with their broker and carrier if there’s a wellness credit in place and if Level qualifies as an eligible expense. And over time, the potential for employees to become healthier due to greater, ongoing wellness utilization means employers’ medical costs could be positively impacted as well.
By using Level to deliver a streamlined, flexible wellness benefit, employers simplify the employee experience, remove barriers to utilization, and support a healthier, more productive workforce for the long term. Wellness dollars are easily accessible through the Level App and Level Card, with no extensive reimbursement processes that burden employees and the team administering the programs.
Coming up next in Part 3 of our series, we’ll detail how to maximize the equity and inclusivity of your benefits by looking beyond the limitations of marketplaces and avoiding the inequity of reimbursement-based programs.
We’re here to help
Level’s benefits and platform are built to simplify the experience for both employees and administrators. Comprehensive, flexible benefits are delivered through one app and card for members, and one integrated dashboard for administrators. Our customers have repurposed budgets from low-utilization programs to provide more flexible, inclusive benefits, with any unused dollars being retained by the employer. If you’d like to explore how your current budget could be reinvested into a simpler experience, reach out here to set up a conversation with our team.