The American Medical Association estimates that every year, $73 billion is lost in unnecessary health care expenditures due to poor "health literacy," the inability of consumers and employees to obtain and understand health care education.

In response to this, many employers have turned to benefits software companies to make learning fun.

"Especially with the younger generations, who are coming into [the workforce] very game-oriented, any development software - whether it be benefit communication software or onboarding - we're going to have to come up with more creative ways to make it more engaging," explains Sybll Romley, a Colorado-based independent consultant and HRIS professional.

Employers need to be aware of the significant paradigm shift in how generations of workers prefer to digest their benefits information. Young employees entering the workplace "are people who grew up playing Sims," Romley says. "They want that interactive real-life example, and they want it to be more like a game."

Offering such real-life information in real time means incorporating cloud technology, which uses Internet-based software models rather than traditional server-based ones. Cloud computing enables business applications to be more mobile, collaborative and secure - similar to popular consumer apps like Facebook and Twitter. (See sidebar for other cloud computing advantages.)


Meet ALEX, your friendly benefits counselor

ALEX, the interactive benefits counselor from thinkers at Jellyvision Lab, leverages cloud technology, user-friendly interface and customizable modeling tools to help employees understand and find benefits relevant to them.

"We wanted to make [the benefits election process] fun, delightful and engaging because frankly, picking a plan has potentially a big impact on your life - depending on what happens medically to you that year - and big financial implications based on the cost you are sharing," says Harry Gottlieb, Jellyvision's founder.

In the program, ALEX asks employees a few simple questions - Are you married? Are you a smoker? What is the size of your family? - to identify benefits eligibility.

"Based on those answers, we identify what specific benefits that you are eligible for," says Gottlieb, explaining that employees only see what plans they can access.

From there, ALEX aids employees in selecting the best plan fit for them and their dependents. With employees' consent, ALEX asks a few more detailed queries: Will you be covering your spouse and any children? About how many regular physician and specialist visits do you make per year? Do you take any prescriptions for chronic or any other conditions? Are you expecting surgery within the year?

After ALEX crunches the numbers, he walks employees through plan options, first showing the least expensive plan at face value. Then, after balancing premiums, deductibles and expected out-of-pocket costs, he shows the truly least expensive plan.

Instead of digging through plan details, employees find answers easily and in one place. Further, ALEX offers options in "plain English," says Gottlieb, adding that ALEX is thorough, but efficient. Employees "get a very thorough explanation of how the plan works in 15 minutes."

The platform is customizable based on a particular employer's benefit offerings, but often includes medical, dental, life insurance and 401(k) education.

"We loved the concept of a quick, easy tutorial about benefits with a little humor, but also a lot of education," says Amy Johnson, a principal benefits analyst at Medtronic. The Minneapolis-based medical device company introduced ALEX to its 24,000 U.S. employees in preparation for its 2011 open enrollment.

"We loved that it was online and accessible anywhere by an employee or spouse - whoever wanted to view it didn't need to be behind a Medtronic firewall," she adds.

Enwisen, another software company helping employees understand benefits, "pools everything the employee needs in a very accessible format and provides the tools to help them make better decisions," says Melanie Lougee, the firm's director of product strategy.

She adds that not only is the format friendlier for making decisions around the kitchen table, but if an employee forgets her benefit card while at the doctor, she can check online to see whether a procedure is covered.


Digitizing the details

In addition to providing plan information, such programs have been instrumental in explaining the complex concepts like high-deductible health plans. For example, one of Enwisen's employer-clients, American Modern Insurance Group, drove enough employees to HDHP to save the company 10% in health plan costs.

Gottlieb adds that benefits tools like ALEX and Enwisen's "give you the total picture," which is necessary when comparing HDHPs to traditional HMOs. "When people look at a consumer-driven plan, and all they see is the high deductible, then they're paralyzed. But when ALEX shows them [the deductible comparison] plus the premiums, plus what you think you're actually going to spend, it may be a superior plan if their expected medical needs turn out to be just that," he says.

Gottlieb notes that a company with 11,000 employees had 1,000 shift from a rich benefit plan to a cheaper plan the year the organization implemented ALEX. "I suspect [these employees] realized that they had been overinsured for a number of years," he says.

To further increase plan understanding, Enwisen rewrites all benefits information at a seventh-grade reading level so the details are easy to comprehend for employees and dependents. In addition to the general descriptions, side-by-side comparisons of different plan options "really tailor [the information] to the audience." By modeling based on dependents, the employee's age and tax information, the technology can make suggestions depending on the demographic of the individual.

The software also provides a handy checklist for an employee having a life event, such as marriage or childbirth. Technology walks the employee through arranging for leave, adding dependents, updating tax information and other employee benefit issues.

Cloud technology produces clear results

Traditionally, four HR employees would travel across the country to explain next year's benefits, visiting 20 Medtronics locations over a three-week open enrollment period. However, as the company's employee orientation already had moved online, it was easy to incorporate ALEX into onboarding. For open enrollment, Medtronics did away with in-person meetings when introducing ALEX and don't foresee reverting back because "cost- and time-wise, we don't get the value out of it," says Johnson.

Although each location has HR business partners onsite to answer questions from employees if needed, Johnson says the company probably won't host another in-person group meeting unless it makes a major benefits change in the future.

According to Jellyvision, during the month of open enrollment, Medtronics had over 22,000 unique visits to the site and over 33,000 visits total.

"We know there was no way on Earth that we would have gotten to that many people in person with meetings, nor does any type of communication get that type of response or read time. We were ecstatic about [the results]," reports Johnson.

According to surveys Jellyvision conducts after implementing ALEX, 89% of employees understand their benefits better after using ALEX. One employer sponsor credits the program with a 30% increase in its flexible spending account participation after one year of using ALEX. Through comments, Jellyvision found that before ALEX, many employees had no idea how these plans worked.

Medtronics had a similar experience with health reimbursement arrangements. Though it had offered the accounts for 10 years, many employees didn't understand them until they saw the ALEX explanation module without benefits-speak.

"I think people enjoyed it as an innovative way to experience benefits unlike anything that we had done the year before," Johnson sums up.

Enwisen has seen similarly impressive results with their program, finding that employees can answer up to 90% of their own questions with an Enwisen portal. That means, if the model is implemented correctly, as many as few as 10% of employees need to speak with a call center benefits professional, and even fewer would need advice from someone with high level knowledge of benefits.

"I think that HR is in a unique position right now, in that they need to offer both [traditional and technological communication tools] because they have a number of people at both ends of the spectrum who need the opposite experience," Romley says. "But as the older generations transition out of the workforce, [other employees] are going to want to see more of that game, online interactive experience occurring."

Even among older workers, cloud-based communication is taking root. Athough the HR team at Hershey Theme Park was concerned, "that some of their older employees wouldn't use the [online] system, and they would have to handle them outside of the system on paper. It wasn't true. Except for 2%, everything was done online," Lougee reports.

Effective promotion

"When they [promote] it well, we will get unique visits in 70% to 90% percent of total population. It's better for everybody," Gottlieb says. Instead of sitting through boring meetings and listening to questions not relevant to you, "here, ALEX is just for you."

Lougee adds that though some organizations worried their employees would reject Enwisen's platform and only seek high-touch interaction, this was not the case. "People enjoy looking at that information at their leisure, usually at home and with their family," she says.

5 advantages of cloud computing 1. Reduced cost. Cloud technology is paid incrementally, saving organizations money.

2. Increased storage. Organizations can store more data than on private computer systems.

3. High automation. No longer do IT personnel need to worry about keeping software up to date. 4. Flexibility.

5. Greater mobility. Employees can access information wherever they are, rather than having to remain at their desks.

Source: Web 2.0 Journal

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