Welcome to Ask an Adviser, EBN’s new weekly column in which benefit brokers and advisers answer (anonymous) queries sent in by our readers. Looking for some expert advice? Please submit questions to
We asked Eric Silverman, founder and owner of Voluntary Disruption, to weigh in on the following: Should we use an enrollment firm to help us educate our benefits during open enrollment?
It depends. I know, I know, that’s such a “consultant” answer. But here are some questions to consider as you explore whether an old-fashioned enrollment firm is right for your company:
- Do you prefer that each employee meet 1-on-1 with a benefits enrollment counselor?
- Do you enjoy organizing, administering and overseeing 1-on-1 enrollments?
- Do you believe that 1-on-1 enrollments are truly beneficial for each employee?
- Do you embrace innovative technology and all the efficiencies it has to offer?
- Do you run an HR department of just you, or maybe one or two others?
The reason these questions are so important to think about is because as innovative technology has become better, traditional old-school enrollment firms are increasingly becoming a thing of the past.
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Why? Well, for starters, you have to understand how enrollment firms get compensated. Typically, they receive commissions directly from the voluntary or ancillary insurance carriers based on the volume of the insurance products sold.
The enrollment firm then either pays their enrollment counselors commission and/or bonuses based on how much is sold by each individual counselor, or a per diem. They will usually bonus each counselor based on total volume as opposed to how much they sell to each individual employee. Either of these methods incentivizes what I call “product dump,” which leads to a commission and bonus grab on the part of the enrollment firm and/or the counselor.
Is this truly in the best interest of your employees? Keep in mind that they are supposed to be educated on all benefits, with major medical being the focal point. Sadly, counselors all too often brush over the medical to get to the voluntary and ancillary lines which they have a direct vested interest in selling.
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Regardless of whether or not they are commission and bonus-driven, the reality is they’re typically judged by their enrollment firm managers based on volume sold, even if they’re not receiving anything but a per diem.
Fast forward to where we are today, quickly moving into 2022. Benefit enrollment systems have become so good that we’re seeing more companies embrace self-serve employee enrollments.
Let’s face facts: we live and work in an on-demand Amazon age. With that in mind, the masses are wired to use the remote control of their daily lives — their smartphone — to become educated about a product or service that they may have interest in purchasing. Why wouldn’t we treat open enrollment the same?
A properly built benefits portal can handle all products and services, and employees can read about each program being offered, download a brochure, even watch a short video explaining the need for each product, and then enroll or waive right in the system. Isn’t this form of education exactly what we’re used to when we look something up on Amazon?
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I know what you’re thinking — what about the employees who don’t embrace technology? No problem. How about simply setting up an on-demand call center for them to access a live virtual counselor? The call center portion would be completely voluntary, and no one is required to use this service. It’s simply there for those employees who would like a little extra hand-holding. What you’ll find is that most employees will actually enroll themselves using the self-serve system they’re provided as opposed to voluntarily choosing to speak to an insurance salesperson.
