Life-event Focus Makes Health Benefits More Valuable, Cost-effective

By: Bryan Brenner - CEO, Benefit Associates

In the last few years, employers striving to provide meaningful health benefits have faced two dramatic marketplace changes: the rise of consumer-driven health care and the decline of the economy.

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These changes have forced us all to approach benefits in a new way. While good employers always provided good employee benefits communications, the recent MetLife �Study of Employee Benefits Trends� suggests employees want more than simple information � they also are looking to employers for direction and guidance on choosing benefits.

In response to these trends, we�ve often seen two approaches. Short-sighted employers slash benefits programs and essentially leave employees on their own to �figure things out.� Better employers seek innovative approaches to making existing � or even reduced � benefits more effective and, as a result, more valuable to employees. One approach I see as having a lot of promise is known as �life-event communications.�

For years, the marketplace has viewed benefits in the context of the calendar, structuring options according to an employee�s age. But we recently have learned that life events such as marriage, buying a house, parenthood, illness and retirement are better predictors than age of what benefits will be of the most value to a particular employee.

Why? Because life events alter a person�s point of view and cause him or her to refocus priorities and seek new information. As a result, life events give employees an opportunity to choose the benefits they need when they are most likely to need them, and they give employers reliable opportunities to provide information at the time when it�s most meaningful.

Life-event segmentation communications can be incorporated into existing benefit platforms in three major ways:

Through use of new media for specific life events. Use of electronic and social media allows companies to tailor targeted messages to specific employees more quickly and cost-effectively than traditional printed media. DVDs, streaming video, podcasts, online seminars and social media can reach employees experiencing certain life events throughout the year. Some employers may feel that, because Baby Boomers make up the bulk of the current workforce, new media tools would not be relevant. Not so. People over 50 account for more than a quarter of the U.S. Internet use, according to the Pew Internet and American Life Project. Plus, that figure is growing 7 to 8 percent a year�the fastest growing segment on the web.

By encouraging employees to spend more time making benefit decisions. It�s disheartening to those of us who spend months creating enrollment materials, but research shows that the typical employee spends only 30 minutes or less making his or her benefit decisions. Targeting messages to life events increases the likelihood that the recipient will spend focused time with the materials, and therefore make better decisions. In fact, the 2008 Study of Employee Benefits and Trends found that people undergoing specific life-changing events spent almost twice as much time reviewing their benefit options.

By supplying more useful information at the right time. The 2007 Open Enrollment Study by MetLife discovered that six out of 10 employees would welcome suggestions from employers that would be appropriate at their life stage. This represents a huge paradigm shift in the employer-employee relationships as it applies to benefits because, historically, employers have been among the least trusted source of health and wellness information.

Can employers benefit from life-event communications? Absolutely. By increasing the value of your benefits program, you increase participation and loyalty, and that builds a more engaged workforce, greater employee loyalty and a stronger position in the competition for new talent � all payoffs you can appreciate, in any economy and any benefits marketplace.

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