Concerned about Next Year’s Employee Benefits Budget? It’s Time to Start Considering It!
Spoiler Alert: You should get rid of those underperforming benefits.
As we reach the mid-point of the calendar year, many Human Resources teams are checking off some of their last open items from the prior plan year, like 5500 filing, Patient-Centered Outcomes Research Institute (PCORI) tax payments, and yes, finally, getting that contract you’ve been waiting for executed. Are you one of them? If so, I have some thoughts.
Prepare for Next Year’s Open Enrollment Now
First, now is not the time to put the list away. In fact, now is the time to think about next year’s employee benefits. Yeah, I know, it seems too early, but the more proactive you can get, the better off you will be once the annual enrollment season kicks off.
So, what can you do?
- Consider the various point solutions and programs you have been offering.
- Dust off the prior year’s medical claims reporting your insurance carrier provided last April. Does the data provide any year-over-year (or better yet, a 3+ year period) reductions in per member per year (PMPM) trends? Note: Look at this data per member not per employee.
- Review your latest employee engagement Are your people telling you there are gaps in what you are providing?
- Talk with members of your company’s C-suite and your peers about what innovative programs they’re considering. Are any of these point solutions on your road map?
- Identify what your pharmacy benefit manager’s upcoming formulary changes and program updates will include. Have you considered how disruption can provide opportunity?
Assign Your Return on Investment
When you consider all the various destinations of your medical and pharmacy spend, there are a lot of areas you may find where you are able to tighten the belt. Take an analytical point of view and assign your own return on investment (ROI) to what you offer.
You will find those budget dollars to double down on the high value ROI programs by pruning out the low-value program offerings. Also consider your vendor contracts. Ensure you’ve got the right transparency on-point solution pass-through arrangements and be sure your performance guarantees are renewed and accounted for annually.
Not sure how to get at that data or where to start with an ROI metric, reach out and let us know. We have experts on hand to help!
Published on: 07.07.22