Benefits puzzle piece Lack of acomprehensive voluntary benefits strategy can lead toinconsistencies in benefits design, branding and administration,which derail the overall objectives of the employer's Total Rewardsprogram. (Photo: Shutterstock)

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A day doesn't go by without headlines announcing significantshifts in the health care landscape. January heralded theannouncement that Amazon, JPMorgan Chase and Berkshire Hathawaywill develop their own health care system for their employees. Morerecently, the Aetna/CVS merger and Humana/Wal-Mart announcements suggestmonumental changes are on the horizon for health care delivery.

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With this volatility, employers must manage rising health plan costs and continue toprovide value to their employees. The burden of rising costs is being shouldered byemployers and employees while coverage is simultaneously beingeroded.

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Cost-saving strategies are now shifting to voluntary benefits. Mainstream carriers arefocusing their energy on these products to offer solutions toemployers struggling to provide employees with creative ways tocope with the increasing, out-of-pocket medical expenses that areinherent in high deductible health plans. With this inmind, many employers have started offering worksite voluntarybenefits such as accident, critical illness and hospital indemnityinsurance, but often without a comprehensive voluntary benefitsstrategy. This can lead to inconsistencies in benefits design,branding and administration, which derail the overall objectives ofthe employer's Total Rewards program.

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Creating an exceptional voluntary offering with a customized setof products, services and solutions is no easy task. Thus,partnering with a voluntary benefit outsourcing (VBO) firmenables employers to combine a voluntary benefit strategy with aholistic approach that aligns with the company's benefitobjectives.

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Related: What are benefits managers' priorities thisyear?

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So, what are the factors to consider when selecting a VBO firm?What benefits will an employer realize when partnering with a VBOfirm?

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Single-destination portal

An integrated portal is essential to creating an exceptionalemployee experience. Providing a single destination website foremployees to access all available voluntary benefits options andcorporate discount programs dramatically enhances the awareness,effectiveness and perceived value of a total benefits program. Eachcomponent of the platform should focus on the “ease of use,” and“ease of navigation,” to maximize the employee experience and planparticipation.

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A fully integrated platform boosts the total value of voluntarybenefits; financial services; workplace giving; wellness; transitbenefits; healthcare exchange options; and corporate discountprogram while eliminating the administrative burden of managingmultiple websites, program vendors and data exchangeinterfaces.

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The platform should meet the unique needs of an employer bypresenting different portal views to accommodate variouspopulations. This ensures employees in each benefit eligibilityclass will have access to only those programs for which they areeligible (i.e., full-time, part-time, union, executives,retirees).

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Single-slot payroll technology

Adding a new benefit is costly and complex. The employer mustestablish new interfaces among benefits administration platforms,carriers, and payroll administrators. A VBO firm should leverageeligibility and single-slot payroll technology to automate thecomplex exchange of enrollment and premium files among multiplecarriers and providers. This consolidates all eligibility andpayroll deductions from an unlimited number of data exchangesfunneling into a single premium amount and generates a singledeductions file. It then remits payment to each carrier.

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Who owns the technology? While many firms boast single-slotpayroll technology capabilities, some leverage a third party. Whena VBO firm owns the technology, there is more control over managingcritical service level components and processes.

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Client & customer service

Ensuring the highest quality of service levels for the clientand the employee is critical to the long-term success of theprogram. The depth and breadth of the team's expertise will empoweremployers to effectively manage an integrated voluntary benefitsprogram.

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The employer should have a single point-of-contact who canaccess a team of subject matter experts (such as consulting,technology, security, billing, web design and communications) thatcan both implement the programs and provide consistent, excellentservice.

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Customer service for employees is essential. Many firms provideemployee support through a dedicated toll-free number with acustomized IVR phone menu and while the 1-800 number is a staple inthe customer service industry, it's important to understand how theemployee will be supported. Whether the inquiry is about policyadministration; policy quote comparison; enrollment; changing anexisting policy; resolving a billing/payroll question; or, claimsadministration, ask the who, what, when, where, and how of employeeadvocacy. Request the VBO firm's call center statistics such as,average wait times, average speed to answer a call, and abandonmentrates. Multiple channels of assistance should be provided toemployees including “live chat” and mobile app devices.

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Security

The most important component in selecting an outsourcing firm isensuring employees receive the highest level of security, privacy,and confidentiality with respect to customer service, IT systems,data exchange, internal procedures & methodologies, and datatransactions with you and carrier partners. Don't be shy aboutgetting into the weeds about how encryption of data is handled andwhat security enhancements the VBO firm employs.

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Communications

A successful voluntary benefits program MUST communicate withemployees on a regular basis. The VBO firm should be able tocustomize campaigns and provide relevant, high quality, effectivecommunications to drive employee engagement!

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The VBO firm should also leverage communication technology tohelp employers direct focused benefit information to an individualand provide valuable resources that are most beneficial to theindividual.

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Reporting & data analytics

Understanding what drives the effect on employees; a specificdemographic group; who is enrolled in what program or offering;and, what the real value/savings of this program, is valuableinformation. It helps employers drive future program performance asyou continuously evaluate, design, redesign, and implement nextgeneration benefit programs.

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A VBO firm should not only provide tools to continuously monitorthese programs for quality, enrollment, communicationseffectiveness, and perceived value by employees, but also holdquarterly and annual strategy meetings to review the overallperformance of the voluntary benefits program.

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The VBO partner must have a well-developed implementationprocess and a detailed project plan that will provide a blueprintfor next steps to include: portal set-up, communications,enrollment, and eligibility/payroll file feed transfers. A solid,knowledgeable consulting partner who can help navigate the variousbenefits offerings and carriers and help orchestrate a successfulprogram will prove to be a valuable asset. VBO firms offer theunique ability to provide benefits that are inexpensive to theemployee and are generally no cost to the employer. The partnershipcontributes to the success of the employer's bottom line, so chooseyour VBO partner carefully.


Peter Marcia assumed an active role in themanagement of YouDecide in mid-2006 as CEO after two years as aninvestment partner. Prior to his involvement withYouDecide he was Vice President and National Director of EmployeeBenefits for Hilb, Rogal and Hobbs.

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