man looking at question marksEmployers should not wait until the enrollment period to inundateworkers with “volumes of information” about the various benefitofferings. (Photo: Shutterstock)

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More than a few workers are “outright confused” about their employer'sbenefit offerings and many are risk-adverse—the combination ofwhich can cause workers to be unnecessarily over-insured, accordingto Benefitsolver's MyChoice Recommendation Engine Benefits InsightsReport.

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A full 30 percent of workers say they are outright confused whentrying to select benefit offers, according to the report. The datais drawn from questions that a half-million employees answered viaBenefitsolver's MyChoice Recommendation Engine to obtain apersonalized benefits recommendation during the 2019 annualenrollment period on the Benefitsolver platform.

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Related: 7 steps to helping employees become more active intheir health care benefits

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“When employees don't understand benefits, they can't fullyappreciate them, which represents a return-on-investment shortfallfor employers, especially when benefits can account for a sizeablechunk of compensation costs,” the authors write.

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Exacerbating this is the finding that a majority of workers viewtheir “risk tendencies” to be that of a more risk-adverse “lounger”(28 percent) or “golfer” (37 percent), as opposed to a morerisk-taker rock climber (3 percent). A third (32 percent) seethemselves about in the middle of the spectrum, having the risktendencies of a “bicyclist.”

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“In addition to lack of knowledge, risk aversion can factorsignificantly into a person's benefits choices, especially withoutappropriate decision support,” the authors write. “Some employeesmay prefer the perceived predictability of a higher-cost PPO ratherthan an HDHP with a lower upfront premium contribution, even whenthe numbers don't add up.”

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To mitigate these issues, employers should not wait until theenrollment period to inundate workers with “volumes of information”about the various benefit offerings, according to the report.Rather, employees should be given more bite-sized digestibletidbits throughout the year.

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“Supporting employees with relevant and digestible educationalinformation about their benefits outside of the enrollment periodcan help them become better consumers and also benefitsambassadors,” the authors write.

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Offering workers decisionmaking tools during the enrollmentperiod can also help employees who lack benefits expertise,particularly if they are also risk-adverse.

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“How plans are designed, how they are communicated, what thingsare called, and how they are explained all contribute to whatemployees choose,” the authors write. “This is especially true whenthey don't really have a strong understanding of deductibles,coinsurance and out-of-pocket maximum or appropriate decisionguidance. They look at a few proof points like their premium anddeductible and may end up spending more (or less) than isappropriate for their situation.”

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Employers that provide such support to their workers can alsohelp their own bottom lines, according to the report. “Thegoal is to ensure that both employers and employees are receivingthe maximum return on their benefits investments by helpingemployees choose the right benefits, in the right place, at theright time,” the authors write.

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Katie Kuehner-Hebert

Katie Kuehner-Hebert is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience, with particular expertise in employee benefits and other human resource topics.