Here’s how the COVID-19 pandemic impacts your business and workforce this open enrollment season.
Annual benefits enrollment season is upon us and businesses are working hard to prepare their staff members to make their elections for 2022. The process typically begins on November 1 and runs through December 15, when employees will have to either make new, change existing, or retain coverage from 2021. As the pandemic wanes, there may be areas you wish to discuss with your staff before they make their elections. This can help assure they have the right coverage for themselves and their families.
For SMBs new to the open enrollment process, it can be a complex deluge of choices, questions and paperwork. Understanding the process is critical to managing it correctly for business and their employees. Incomplete paperwork, forms submitted past their due date, or forms not returned at all can result in devastating loss for employees and their families for the entire coming year. Managing open enrollment correctly supports employee health and boosts employer metrics for engagement, reductions in absenteeism and reduced healthcare costs overall.
COVID-19 in the mix
42% of workers said they would sacrifice additional pay monthly for a more expansive health benefit plan.
The advent of the COVID pandemic has shifted the focus for business and employees to health. SMBs, whether required by law or not, have seen an uptick in the amount of workers who want access to healthcare coverage and those who wish to enroll. A survey by Willis Towers illustrated how important healthcare benefits are to workers. A majority, 57%, said benefits are more important than ever before. Another 42% of workers said they would sacrifice additional pay monthly for a more expansive health benefit plan.
Gone are the days of employees newer to the workforce waiving coverage because they consider themselves hale and hearty while the cost of coverage was too high. The pandemic has changed the risk/benefit ratio in favor of purchasing coverage. Employers are seeing larger participation in existing plans, and employees requesting more comprehensive coverage when possible.
The pandemic has changed the way we provide coverage. Virtual and telehealth programs are the newest way to see a doctor without leaving home. Most providers offer this benefit as part of their standard package, providing doctors participate. Mental health coverage has also expanded into the virtual realm as many employees required additional support for the stress and anxiety brought on by the pandemic.
Virtual medicine may have begun in earnest with COVID, but it will likely continue to be a sought-after option for physical and mental health long after the pandemic has ended. Telemedicine not only helps employees with its convenience, it:
- Reduces time off work for appointments — particularly routine checkups
- Reduces office wait times
- Lessens exposure to other patients and their illnesses
Changes in coverage that may affect elections
Early on in the pandemic, many insurance carriers waived the cost-sharing requirement for COVID-19 treatment. An estimated 88% of workers enrolled in private healthcare coverage were subject to no out-of-pocket costs if they were treated and/or hospitalized with COVID-19 in the early stages of the virus.
Many providers are no longer waiving cost-sharing for treatment. While required in some states, and loosely agreed upon in others, many fully insured enrollees have begun seeing co-pays and out-of-pocket expenses for treatment and hospitalization with the virus in 2021. More will likely see co-pays and out-of-pocket costs in 2022.
Insurers suggest that with widely available vaccines, the need to absorb these costs is no longer necessary: some phased out the waivers recently, others plan to do so in the coming months. For business and workers, this may mean electing coverages that provide lower deductible and out-of-pocket expenses to assure no devastating financial impact in the event they are treated and/or hospitalized with the virus. Businesses may see an increase in participation and enrollment as these changes roll out.
Many fully insured enrollees have begun seeing co-pays and out-of-pocket expenses for treatment and hospitalization with the virus in 2021. More will likely see co-pays and out-of-pocket costs in 2022.
More employees opting into healthcare coverage requires more paperwork. For SMBs, the volume of work required by open enrollment is an annual loss in productivity. Savvy business owners turn to digital solutions to manage the enrollment process for the coming year, and for all additions, deletions and changes employees have for their coverage during the plan year.
Most business owners are not benefits administration experts: they may face challenges in choosing the right coverage plan(s) for employees and to assist workers in understanding the options and coverage available. Next comes the actual process of enrollment – issuing, completing, and returning and submitting forms to carriers. Hours and days are spent away from high-value tasks to manage enrollment. Outsourcing the process to experts who have the answers and have automated systems for perfect enrollment, every time, is a cost-effective return on investment for business.
Make healthcare a priority
Many small businesses not required under the Affordable Care Act to provide coverage: some are not mandated but do so anyway. If business or employees are purchasing coverage through the ACA’s Small Business Health Options Program (SHOP) plans enrollment begins Monday, November 1, 2021 and closes on January 15, 2022. To acquire coverage that begins on January 1, however, they must submit enrollment by December 15, 2021.
Providing coverage is a priority for workers and business, but many SMBs worry healthcare isn’t affordable. With so many options available today there are plans available for every size business at virtually every price point. When you factor in reduced absenteeism, sick time and turnover, and increases in engagement and retention, most organizations find providing coverage is a smart investment with a solid return.
For every business, no matter its size, there are tax benefits and incentives for providing coverage to employees and their dependents. When organizations share the cost of coverage with employees, their pre-tax portion reduces overall payroll tax burden. For the employer contribution, deductions are available for these necessary business expenses. Healthcare coverage is a win/win for business.
A significant change for 2022 and beyond as a result of the pandemic is the lesson learned: the need to attend to the physical and mental well-being of employees is critical, for their benefit and the benefit of the organization.