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CCH® BENEFITS — 02/14/11

Employers Move To Decision Support Tools For Enrollment

from Spencer’s Benefits Reports: A greater number of plan sponsors than ever are providing decision support tools for plan participants, although satisfaction with the tools has decreased, according to a recent survey of annual enrollment from Towers Watson.

Key findings of the survey include these:

• Nearly six in ten plan sponsors (57%) provided decision support tools for participants. However, dissatisfaction with these tools increased, most notably for total out-of-pocket expenses for various plans using claim data as a predictor for 2011 and for estimated life insurance needs.
• A significantly higher percentage of companies that outsource (69%) use decision support tools during open enrollment, compared to 44% that insource.
• Large and midsize companies handle the enrollment process differently. For example, nearly half (47%) of midsize companies (fewer than 15,000 participants) insource annual enrollment, while this occurs with only about one-third (32%) of large organizations (15,000-plus participants). Three-quarters of the midsize companies that currently insource, however, are planning to outsource.
• The number of companies still using paper-based benefit enrollment dropped by more than five percentage points in 2010 and is now less than 9% (down from 14% last year).
• Companies increased their use of technology to communicate with employees, but they also held more face-to-face meetings—organizations are not dispensing with personal interactions, according to the survey.
• More than half of respondents (52%) reported that implementing health care reform in 2010 was somewhat easy. However, for organizations that outsource, it was even easier.
• Challenging issues for plan sponsors remain: helping employees understand new plan features, handling a greater number of service center calls and explaining price changes.
• The volume of merger and acquisition activity among benefits outsourcing vendors was high this year: Close to half (44%) of the larger organizations surveyed use vendors affected by these changes.

For more information on the survey, Annual Benefit Enrollment 2011, go to http://www.towerswatson.com/research/3721.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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