Why Benefits Technology Is Becoming a Business Strategy, Not Just an HR Tool

Technology has changed almost every part of the employee experience.

Employees expect to access information quickly, complete tasks online and manage many aspects of their professional and personal lives through digital platforms. Yet in many organizations, employee benefits still operate through fragmented systems, outdated processes and confusing communications.

That creates a problem that goes beyond HR.

When employees cannot easily understand their benefits, enroll in coverage, find important information or get answers to basic questions, the technology surrounding the benefits program can become a source of frustration.

For employers, that frustration can eventually affect engagement, productivity and how employees perceive the organization.

Benefits Technology Is Part of the Employee Experience

Employee benefits are often discussed as an insurance or compensation issue.

But employees experience benefits through technology as well.

They may use an online enrollment platform to select coverage. They may access a benefits portal to find information about their deductible. They may use a mobile application to locate a provider or review information about their plan.

The quality of those digital experiences matters.

A well-designed benefits platform can make complicated information easier to access. A poorly designed system can make even a competitive benefits package feel difficult to use.

This is why employers should consider technology when evaluating their overall employee benefits strategy.

Employees Expect Digital Simplicity

Consumers have become accustomed to simple digital experiences.

People can manage banking, travel, shopping and communication from their phones. They expect information to be accessible and interfaces to be intuitive.

Employee benefits should not necessarily be expected to work exactly like consumer technology, but employers should recognize the expectation employees now bring into the workplace.

If an employee has to search through multiple documents to determine whether a service is covered, call several numbers to find the right department or navigate an outdated enrollment system, the experience can feel unnecessarily complicated.

Benefits are already difficult enough to understand.

Technology should make them easier, not harder.

Better Technology Can Help HR Teams Too

The value of benefits technology isn’t limited to employees.

HR teams also spend significant amounts of time answering questions, managing eligibility, correcting enrollment information, communicating plan changes and coordinating with carriers and vendors.

When systems are disconnected, administrative work increases.

When information is centralized and processes are automated, HR professionals may be able to spend more time on higher-value work.

That could include workforce planning, employee engagement, retention initiatives, compliance strategy and organizational development.

The goal isn’t technology for technology’s sake.

The goal is to eliminate unnecessary friction.

Data Can Improve Benefits Decisions

One of the most important advantages of modern benefits technology is access to better information.

Employers need to understand more than how much they spend on health insurance.

They should be asking questions such as:

• How are employees using the plan?
• Where are healthcare costs increasing?
• What services are employees using?
• Are there opportunities to improve plan design?
• Are employees actually using the resources available to them?
• Where are administrative inefficiencies creating unnecessary work?
• What benefits do employees value?

Better technology can help bring information together so decision-makers have a clearer picture.

That can be particularly important during the annual renewal process.

Instead of simply looking at the renewal percentage and deciding whether to accept it, employers can examine the broader picture of utilization, plan design, employee contributions and healthcare spending.

Technology Doesn’t Replace Strategy

There is an important distinction between having benefits technology and having a technology-enabled benefits strategy.

Buying another platform doesn’t automatically solve a benefits problem.

Employers need to determine what they are trying to accomplish first.

If the goal is to improve employee communication, the technology should support that goal.

If the goal is to simplify enrollment, the system should reduce administrative complexity.

If the goal is to better understand healthcare spending, the technology should provide useful data and reporting.

The technology should serve the strategy.

Not the other way around.

Integration Matters

Another challenge for employers is the number of systems involved in managing the employee experience.

An organization may have separate platforms for payroll, HR, benefits administration, enrollment, COBRA, retirement plans and other employee services.

When those systems don’t communicate effectively, employees and HR teams can end up doing the work manually.

Integration can reduce duplication and improve the flow of information.

But employers should also consider security, data accuracy, ease of use and the employee experience when evaluating technology.

The most expensive platform isn’t necessarily the best platform.

The best solution is the one that solves the organization’s actual problems.

Benefits Technology Can Support Cost Management

Technology can also play a role in healthcare cost management.

Employers increasingly need better visibility into where their healthcare dollars are going.

That doesn’t mean technology alone will reduce healthcare spending.

Rather, better data can help employers identify areas that deserve attention.

For example, claims information may reveal patterns that aren’t obvious from a renewal proposal. Pharmacy utilization may identify opportunities for further review. Plan design data may show whether employees and employers are carrying costs in ways that make sense.

This is where healthcare cost management becomes connected to technology and data.

The objective isn’t simply to collect more information.

It’s to turn information into better decisions.

The Future of Benefits Will Be More Digital

Employee benefits are becoming increasingly connected to the broader employee experience.

Employees want benefits that are understandable, accessible and relevant.

Employers want programs that are financially sustainable and easier to administer.

HR leaders want better tools.

Finance leaders want better visibility into costs.

Employees want a simpler experience.

Technology sits at the intersection of all of these priorities.

But successful benefits technology requires more than selecting a platform. Employers need to understand their workforce, evaluate their current processes and determine what problems they are actually trying to solve.

The future of employee benefits isn’t simply about adding more technology.

It’s about using technology to make benefits easier to understand, easier to manage and more valuable to both employers and employees.

When technology supports a thoughtful benefits strategy, it can become much more than an administrative tool.

It can become part of the infrastructure that supports the modern workplace.

About the Author

Jennifer Schaefer, MBA, ChFC, CLU, RHU, REBC, SHRM-SCP is the Founder and CEO of JS Benefits Group, an employee benefits consulting firm that helps employers develop competitive benefits programs, manage healthcare costs and make informed decisions about their workforce.

Jennifer works with employers on employee benefits strategy, health plan design, healthcare cost management, cost containment, employee retention, benefits technology and compliance. She is a Forbes Business Council Contributor and Co-Host of Executive Leaders Radio, where she discusses employee benefits, leadership, workplace trends and the future of work.