When you read the word “renewal,” what comes to mind? Well, while this word has a generally positive connotation, it’s safe to say that, for most of us, the word “renewal” isn’t really associated with many fun processes. Renewing your driver’s license, renewing your car’s registration, renewing business contracts—these are all things that might make you cringe a little bit upon hearing the word renewal. For some, this may include the health plan renewal process. This one is almost twice as misleading as it combines the word renewal with the word benefits (even though health insurance plan renewal can often feel quite far from a renewal process that you benefit from). For business owners and benefits administrators, health insurance plan renewal is likely a process that you dread all throughout the year, whether it be because you’re scared of the inevitable price increase or you’re worried about all the confusion that typically comes with health plan renewal.
At Payday HCM, we’re very familiar with the potential confusion that comes with the plan renewal process. We have clients ask us questions about the renewal process all throughout the year leading up to open enrollment season. This largely includes questions about how to make the health insurance renewal process smoother than it’s been in years past. It’s an important question, and it’s one that businesses are frequently asking themselves.
That’s why, in this article, we’ll be going over the health insurance plan renewal process and how you can ensure both your renewal and open enrollment processes go smoothly. We’ll work our way all the way down the renewal process through open enrollment, starting with communication between the insurance carrier and the employer or benefits administrator, all the way through employees enrolling in benefits. We’ll dive into what this process looks like and the different ways that employers can help save both their employees and themselves time heading into their benefits renewal and open enrollment.
In this article, you will learn:
- Plan Changes, Price Increase for the Upcoming Year
- From Carrier to Employer to Employee: Preparing for Enrollment
- How to Ensure a Smooth Open Enrollment for Employees
Plan Changes, Price Increase for the Upcoming Year
The health insurance renewal process begins with the insurance carrier communicating plan changes and potential price increases to the employer or benefits broker.
Receiving Benefits Renewal Documents
Once it approaches open enrollment season, insurance carriers will begin sending out renewal documents to either employers who administer benefits directly to their employees or to the benefits brokers or agencies that administer employee benefits on behalf of the employer. If your business is partnered with a benefits agency, you don’t need to worry about renewal documents.
While the exact contents and structure of the renewal documents will vary by carrier, these documents generally contain information regarding the current health plan and the new plan being renewed. This information includes details on services covered as well as a price breakdown.
Assessing Renewal Documents
The renewal step is crucial in determining the shape and cost of your organization’s health insurance plan heading into the next year. This is the moment where either you, as the employer, or your benefits agency or broker will assess the renewal documents from the carrier to determine whether renewing your current plan or transferring to a different plan or carrier is the right step for your business.
The things to look for when assessing renewal documents include the kinds of services covered as well as the prices for those services. Of course, price increases are standard, so you shouldn’t be looking for no increase. Instead, keep an eye out for any larger-than-expected increases to things like deductibles, cost of emergency care, prescriptions, or other line items.
For businesses working with a benefits broker or agency, this process will look somewhat different as you won’t receive renewal documents directly from the carrier. When working with Payday, for example, we’ll go through and assess your renewal documents and provide you with a side-by-side comparison and breakdown of your plan changes, as well as any information on other plans that are available to you.
From Carrier to Employer to Employee: Preparing for Enrollment
Once you’ve decided on a plan and completed the renewal process, you’ll then need to start working toward open enrollment and communicating plan changes to your employees.
Communicating Plan Changes to Employees
So, now that you’ve decided on a plan for the upcoming year, it’s time to communicate with your employees what’s new heading into open enrollment. Informing employees of the upcoming changes to their health insurance plan is crucial, as some employees may want to make changes to their enrollment depending on how the plan will change in the coming year.
When it comes to communicating these changes heading into open enrollment, employers should plan on taking several steps in order to ensure complete understanding within their organization. This includes hosting an open enrollment meeting to discuss any plan changes in detail, as well as to go over how to enroll.
Like the health plan renewal process, the communication of plan changes to your employees may look different when working with a benefits agency or broker. With Payday, for example, we’ll take the lead in communicating these changes to your employees, hosting open enrollment meetings, and providing your employees with benefits guides and handouts to ensure total understanding of what’s included in their plan and how to enroll.
Creating Open Enrollment Documents
While a smooth open enrollment process begins with a productive open enrollment meeting, this isn’t the only step employers should take when it comes to communicating plan changes to their employees. Employers should provide their employees with detailed plan information in the form of a benefits guide so that employees can make an informed decision heading into open enrollment.
Following the renewal process, either the employer, if working with the carrier directly, or the benefits agency or broker will receive a Summary of Benefits and Coverage (SBC) from the carrier. This SCB can be combined with your open enrollment presentation and other relevant documents to create a comprehensive benefits guide you can provide to your employees.
How to Ensure a Smooth Open Enrollment for Employees
Now that you’ve completed the renewal process and communicated plan changes with your employees, it’s time for the members of your organization to begin enrolling.
Enrolling in Benefits During Open Enrollment
You’ve selected your health insurance plan for the upcoming plan year (whether that be you renewing or selecting a new plan), and you’ve communicated these changes to your employees—now what? Well, now begins the process of employees actually enrolling in or waiving benefits.
For those who are enrolling in benefits, it’s crucial that you go over all of the plan information to ensure that you’re making the best decision possible when it comes to enrollment. Whether you’ve continually enrolled each year or are relatively set on waiving, it’s still important to assess what’s available to you so you can make an informed decision.
Open Enrollment With a Benefits Administration Software
On the employee side, open enrollment hinges on a capable benefits administration software. Even if you take the time to communicate each and every plan change with your employees, it won’t really matter if they encounter software issues when trying to enroll or waive. The same logic applies if an employee is unable to readily answer any questions that may arise while completing the enrollment process through their self-service portal.
Just like the renewal process, it can be beneficial to take a look at the HRIS you’re using and assess whether to continue using it heading into the new plan year. Solicit employee feedback on the enrollment process from the previous plan year to determine whether there needs to be any changes to the benefits administration software your organization uses.
A capable benefits administration software can not only streamline the enrollment process for employees, but also alleviate some of the administrative burden for employers. isolved, for example, allows employers to upload documents, like a created benefits guide or open enrollment presentation, for employees to access during the open enrollment period and into the plan year for new employees enrolling outside of the open enrollment period.
Renew the Benefits of Benefits With a Smooth Health Plan Renewal Process
While creating a comprehensive, cost-effective employee benefits package is crucial, it doesn’t mean a whole lot if nobody enrolls in any of the benefits offered. Even if you do the work and research what benefits employees in your organization need or want, you still need to ensure everyone not only has a good understanding of how to enroll in benefits, but also that the software they’re using makes enrolling in benefits easier, not harder. Of course, much like creating a comprehensive benefits package, these things are often easier said than done. With the information provided here in this article, though, you can ensure that, from the moment you receive your renewal documents from your carrier (or meet with your administrator to talk about health plan renewal), you’re business is off to a great start.
Understanding what’s included in your business’s benefits plan can help you find what’s helpful for your employees and what’s not. Choosing the right health insurance plan for your business can not only make a significant difference in terms of plan cost but also enable employees to fully utilize their benefits. Check out our article for six ways to craft an effective company health plan and ensure that your employees are able to get the most out of their benefits.
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