Most employee benefits and HR technology systems are integrated, at least half are hosted in the cloud, and benefits enrollment is the leading application and driver of decisions, according to new research conducted for Employee Benefit News.
Other key findings from the annual survey of HR and benefit professionals found that respondents were satisfied or very satisfied with their tech purchases. More than 90% of respondents said they spent as much or more on technology this year as they did in 2015. And the areas targeted for increased spending, changes or replacement included systems for benefits enrollment, administration and portals.
The 2016 EBN Tech Survey, in its third year, was conducted in August by Sourcemedia Research to identify technology trends. In total, 259 professionals responded to the online poll.
The motivation behind benefits technology purchases is a realization by employers that plan participants face an increasingly burdensome path along the way to properly engaging in their healthcare plans, observes Trevis Parson, chief health and benefits actuary at Willis Towers Watson.
“These are supposed to be attraction and retention tools,” he says, referencing the need “to improve the experience of people who are bearing more responsibility every single year with respect to their healthcare plan.”
This can help plan participants better manage plan choices, increasing costs and cost-shifting strategies.
Industry snapshot
Most of the individuals who responded to the EBN 2016 Tech Survey held the title of VP or director of HR (20%) or director of benefits (nearly 19%), while an even larger percentage specified “other” HR or benefits-related job descriptions (more than 30%). Rounding out the survey sample were brokers, consultants and C-suite executives.
There were as many working in healthcare as in “other” categories (21% each), followed by manufacturing (14%), financial services (nearly 11%) and education, institution or endowment organizations (7%).
In terms of the size of their organization, 37% of respondents work for entities that employ between 1 to 199 people. Nearly 21% work in companies in the 1,000 to 4,999 range and 17% in the 200 to 499 range. Nearly 9% work for companies with 500 to 999 employees, 7% with 10,000 to 24,999 employees and nearly 6% with 5,000 to 9,999 employees.
The survey respondents have the power to make final decisions about IT. Most are highly (47%) or moderately (31%) involved in benefits technology purchasing plans, and 21% take the lead when it comes to their involvement. The top decision-maker for these initiatives was identified as a senior executive (nearly 45%), VP or director of HR (20%) or CFO/VP of finance (11%).
Leading applications
Benefit technology decisions are largely driven by a desire to help employees enroll in, use and monitor their benefits (nearly 52%) and help the company gain greater control or oversight of its benefits package. Another objective is to help control benefit costs (nearly 11%).
In terms of benefits-specific technology that excludes HR functionality, the leading applications were for core benefits enrollment (nearly 82%), administration (74%), employee benefits portal (57%) and communication excluding social media (41%). Rounding out the responses were voluntary enrollment (39%), wellness enrollment (nearly 26%), voluntary administration (24%) and analytics (22%), and wellness apps and wearable wellness devices (15% each). The technology also is being used for other benefits apps (12%) and social media (11%).
Lisa Rowan, research vice president, HR, talent and learning strategies for IDC, was heartened “to see that employers are investing in employee wellness as part of their overall benefits programs.”
Nearly half of respondents said their benefits applications are hosted in the cloud, while the rest were unsure (both 47%). Most aren’t planning to port additional applications to the cloud in 2017 (nearly 70%).
Most benefits and HR technology systems are to some extent tightly integrated. The leading description was completely (28%) followed by mostly and partly (26% each) and not at all (nearly 19%).
When asked to list the top technology vendors, respondents cited many familiar names. They include ADP, Benefitfocus, Benetrac, bswift, Enrollease, Fidelity, Lawson, Liazon, Mercer, Oracle, PeopleSoft, SAP, Willis Towers Watson and Xerox.
High satisfaction
Satisfaction was high across several categories. Most respondents were satisfied (53%) or very satisfied (17%) with their current core benefits enrollment technology system, while nearly the same percentage professed neutrality or dissatisfaction (13% and 15%, respectively).
The fact that most buyers were satisfied with their current cloud-based technology “speaks well for the benefits technology suppliers in the industry,” according to Rowan.
For benefits administration, most also were satisfied (47%) or very satisfied (20%), while 15% were neutral and 11% were dissatisfied. For voluntary enrollment, most were satisfied (51%) or very satisfied (16%), while nearly 20% were neutral and nearly 10% were dissatisfied.
The admin area has been spotlighted in recent years because of the need to comply with more reporting requirements, Parson explains.
In terms of benefits analytics, most were satisfied (nearly 40%) or very satisfied (nearly 26%) while 24% were neutral and nearly 7% were dissatisfied. For wellness enrollment, most were satisfied (nearly 42%) or very satisfied (13%), while 31% were neutral and 12% were dissatisfied.
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For wellness tracking or analytics, most were satisfied (42%) or very satisfied (14%), while 31% were neutral and nearly 11% were dissatisfied. For benefit apps, most were satisfied (57%) or very satisfied (15%), while 15% were neutral and the rest were dissatisfied or very dissatisfied (6% apiece). For wellness apps, most were satisfied (30%) or very satisfied (20%), while 28% were neutral and 20% were dissatisfied. For wearable wellness devices, most were satisfied (46%) or very satisfied (25%), while nearly 18% were neutral and nearly 8% were dissatisfied.
In terms of the employee benefits portal, most were satisfied (58%) or very satisfied (16%), while nearly 15% were neutral and nearly 9% were dissatisfied. In terms of benefits communication excluding social media, most were satisfied (42%) or very satisfied (19%), while 24% were neutral and 9% were dissatisfied.
For social media, most were satisfied (40%) or very satisfied (13%), while 36% were neutral and 10% were dissatisfied. In terms of other technology, most were satisfied (33%) or very satisfied (nearly 17%), while 33% were neutral and nearly 17% were dissatisfied.
Pondering upgrades
Increases in benefits technology spending are expected in 2017. Five percent plan to spend as much as $1 million, and 5% more plan to spend $250,000 to $499,999. Ten percent plan to spend $100,000 to $249,000; nearly 15% plan to spend $50,000 to $99,999 and 25% plan to spend $10,000 to $49,000. The rest plan to spend less than $10,000 on benefits technology.
Ninety-three percent of respondents said they spent as much (48%) or more (45%) on benefit technology this year as last year. Few reported decreased spending (nearly 7%).
Asked which products or services they planned to increase spending on next year, most said benefits enrollment (51%), which was followed by benefits administration (47%) and employee benefits portal (37%).
Other areas being targeted for spending in 2017 include benefits communication (29%), wellness enrollment (27%), employee benefits analytics (26%), wellness tracking/analytics (25%), benefit apps (17%), wellness apps (15%), wearable wellness devices and voluntary enrollment (13% each). Also cited were the “other” category (11%), voluntary administration (10%) and social media (6%).
Asked which technology systems they were thinking of changing or replacing in 2017, most cited benefits enrollment (25%), which was followed by benefits administration (21%), employee benefits portal (15%), voluntary enrollment (12%), and wellness enrollment and employee benefits analytics (11% each). Other areas being considered for change or replacement include wellness tracking/analytics (10%), benefits communication (9%), wellness apps (8%), benefit apps (5%), social media (4%) and wearable wellness devices (3%).
