COBRA Calculus Mar 31, 2009

San Francisco, CA – According to Jennifer Benz, founder and chief strategist of Benz Communications, helping employees recognize the value of their company-sponsored benefits is always smart and beneficial; doing so during tough economic times is imperative.

“Nothing better illustrates the value of company-offered healthcare plans than COBRA – especially now with all the media attention surrounding the 65% COBBRA subsidy passed by Congress to help newly unemployed Americans afford the level of benefits they had while employed,” says Jen. “Unfortunately, many companies neglect to tell their employees the true cost of their healthcare benefits. As a result, employees rarely realize what a great deal they’re getting on their benefits—until they’re paying for it themselves,” she continues.

Jen maintains it doesn’t have to be that way. “There are many simple ways companies can help employees appreciate and understand the value of their benefits—while they are still working. And, as employees value benefits more than company culture or advancement opportunities – according to a recent MetLife study – why not give them a full understanding of just how valuable those benefits are, especially given the current economic environment when stress is high and budgets are tight,” Jen concludes.

Benz Communications offers five ways to increase employee understanding of their company-sponsored benefits.

Get employees to use the plans
Nothing demonstrates real value better than use. Encourage employee engagement with simple reminders about how and why they should be using their benefits. Promote preventive care, remind employees about the fitness incentive or wellness programs, explain all the ways your EAP can help (well beyond counseling), and aggressively market on-site resources or discount programs.

Explain what it means to be self-insured
Employers generally forget to tell their employees they’re self-insured, which leaves employees to assume “the insurance company” is picking up the tab. Explain: a) what it means to be self-insured and b) how that translates into what the company is providing.

Show the employer and the employee contribution
At new hire enrollment, during open enrollment, and whenever employees submit life-event changes, show both the employer and the employee contribution. Many companies let employees know the percentage of payments they pay – e.g., “We pay 85% of premiums – but never reveal the actual number, which speaks volumes.

Promote your Total Rewards statement
If you have a print or online Total Rewards or Total Compensation statement, make sure your employees are seeing it. (If you don’t have one, create one.) These statements “add up” the employers’ investment in benefits and can be a great help to managers during those tough salary conversations that will surely be happening this year.

Ask for feedback
Do you know what your employees want or need? Let them tell you what would make the benefits program more valuable or easier to use. Some of their suggestions could prove useful—and you’ll earn their respect for valuing their opinions and ideas.