The employee benefits landscape has grown substantially over the last decade, leaving many human resources professionals struggling to keep pace. HR processes can be complex and time-consuming, increasing a company’s risk of making costly errors.
According to Employee Benefits News, up to eight percent of dependents enrolled in an employer’s healthcare plan are ineligible to receive benefits. For an average $2,000,000 of benefits spent, companies could be losing up to $160,000 a year.
Automating benefits administration tasks can help save businesses time and money, while also reducing the risk of mistakes. Benefits administration involves a variety of tasks, such as new hire onboarding, open enrollment, salary changes, cost management, compliance, plan audits, benchmarking, monitoring eligibility, and life event changes.
What Should Be Automated In Benefits Administration
With guidance from an experienced employee benefits consulting firm, companies can take the necessary steps to automate manual benefits administration tasks and make the HR role more manageable.
When deciding how best to streamline benefits administration, consider automating the following:
1. Paid Time Off Management
Paid time off is one of the most popular employee benefits in the U.S. and most workers use every last minute allocated to them. Not all businesses view PTO in the same way, bundling paid time off with paid vacation and paid holidays. HR professionals are tasked with tracking various types of leave, often resulting in an administrative burden.
Automating PTO saves both employees and managers time by implementing a system that automates prorated time off based on start dates while accounting for any previous rollover time off. Automated systems can go as far as accounting for the type of time off and send reminders to employees about their available PTO to avoid the end-of-year rush to use their remaining PTO.
2. New Hire Reporting
New employees are met with a variety of forms, such as W-4 forms, state new hire tax forms, direct deposit authorizations, employee handbook acknowledgments, and similar paperwork. Information regarding employee benefits is also a must and a major hassle for administrative professionals. Most companies require employees to wait 30 to 60 days before signing up for benefits which can often lead to confusion among new hires.
Automating new hire reporting can help save HR personnel time by automatically sending reminders regarding the sign-up window, what benefits are available, and what documents are needed to enroll. Summary plan descriptions can be difficult to manage but when utilized in a linkable format, become much more manageable.
3. Employee Data Security
According to IBM’s Cyber Security Intelligence Index, approximately 60 percent of all data breaches are caused by employees. Ensuring the privacy of employee data is of the utmost importance for HR personnel. Employee benefits administration systems must work securely with IT networks to protect sensitive employee information.
This process involves identifying potential security risks before automating business processes and addressing these risks by analyzing available security features within the automation tool. Businesses must also follow security best practices during all stages of automation, including environment setup, bot development, and execution of automated business processes.
4. Medical Insurance
Health insurance is a complex industry that is constantly changing. Automating the medical insurance process helps minimize the abundance of paperwork associated with health benefits and organizes information in a centralized location where it can be easily accessed when needed.
Risks are reduced when medical insurance information is automated. HR professionals also save time by having data available at a click of a button instead of having to fumble through files. Nearly every aspect of the medical insurance process can be automated, from the initial enrollment of employees in health plans to healthcare claims processing.
5. Reporting & Analytics
Reporting is a vital aspect of benefits administration that often gets overlooked. Automation enables businesses to store essential information for compliance purposes where it can be easily accessed. Reports also provide insight into other areas, such as enrollment, healthcare expense per employee, changes to employee classifications, and plan adoption.
Solutions that include built-in analytics also allow companies to easily identify trends that may not stand out in manually created reports. Analyzing these trends can help business leaders discover areas in which they can make positive changes within the organization.
Automating benefits administration is an effective way to control costs, lessen the burden on HR personnel, maintain employee data security, and reduce the risk of errors. A well-implemented automation tool can streamline the benefits eligibility process, improve premium invoice and carrier reconciliation, and eliminate the stress associated with administering open enrollments, life event processes, and ongoing new hires.
Contact an Employee Benefits Consulting Firm
Need help automating your benefits administration? New City Insurance is an experienced employee benefits consulting firm specializing in benefits consulting, insurance, compliance, and technology services. Contact us today to schedule a consultation with a reputable employee benefits consultant.