This article is the second in EBN's annual Open Enrollment Boot Camp series, designed to strengthen benefits practitioners with different strategies to employ during this year's enrollment season. Last month, the series examined strategies for employers to use in increasing employee engagement and participation in retirement plans and financial planning. The article, "Breaking down the wall," is available at ebn.benefitnews.com. This installment addresses the voluntary benefit options available to employers seeking to integrate financial education, legal services and physical wellness programs.
For employers, whose health care costs are rising at about 10% each year, it may be time to re-evaluate not just their wellness programs and medical plan design, but also voluntary benefits like financial counseling and legal services as well.
Studies have long shown that debt, divorce and bankruptcy impact physical and emotional health, but it's not been until recently that employers have taken notice that their increased number of high blood pressure-related health claims may be connected to employee strains outside the office.
It's not just health that is affected; it's productivity. According to MetLife's 9th Annual Study of Employee Benefit Trends, 78% of employers say employee are less productive while at work when they are worried about personal financial problems.
Financial education, with a wellness twist
In the past two years, Liz Davidson, CEO of Financial Finesse, a provider of financial education for employers and their participants, has seen an uptick of employers asking for the services it offers and a difference in the way employers market financial wellness. The firm's signature marketing piece for its program is a picture of a man with frizzy hair, a wild look in his eyes and his fingers crossed. The caption simply asks: "Is this your financial plan?"
"That kind of marketing would have been taboo in Fortune 1,000 companies, but now it's a popular piece in our portfolio," Davidson says. Financial Finesse mainly deals with larger employers with at least 15,000 employees, but the company also has seen a movement down market from midsized employers in the past few years. Employers also are adding incentives to these programs, she says, similar to the way wellness programs are set up. She's even seen employers do drawings for hot-ticket items like an iPad to boost participation in financial education sessions.
Legal problems, use of legal services both increase
From 2007 to 2011, overall legal plan usage in the category of debt and financial matters increased 120% for Hyatt Legal Plans. Legal plan usage for bankruptcy increased 167%.
"We found that the legal plan really helped promote employee wellness because they're stressed, fatigued, distracted and worried about families. When they have an attorney as if on retainer, then they don't have so much stress," says Marcia Bowers, sales and marketing director at Hyatt Legal. Its group legal plan costs employees on average $20 a month, with little administrative burden and no cost to the employer.
A case study put out by Financial Finesse highlighted the return on investment by one Fortune 500 company that saved 21.57% in health care costs for heavy users of the financial education program, versus 4.19% for nonusers from 2009 to 2010. Group legal plans and financial education intersect in many areas - like estate planning - that can have an impact on the stress and ultimately the amount of cortisol released - that hormone that makes the body go into flight or fight. For a "wellness" program to truly work, perhaps it's time for employers to put all these parts of wellness together. (See sidebar for statistics supporting such an integration.)
Integrating programs may seem like a sound strategy in theory, but with so many voluntary carriers in the market, it can be tricky in practice. "If you have all these carriers, it becomes overwhelming, and you lose out on the benefit of offering the plan in the first place. It can turn into a negative from a positive," says Dana Grimm, vice president of client services at CBIZ. Part of Grimm's job is assessing the carriers an employer is working with, if those vendors are doing the right job for an employee demographic and how well the vendor partners work together. She says a plan shouldn't have more than three or four carriers, even if the employer isn't the one directly paying for the services.
Consolidating carriers may mean an employer has to pay extra money to get all voluntary benefits through one brokerage firm, or it may mean making concessions so that multiple products are offered through the same carrier, even though some of those may not be the best-in-class.
Moving parts aside, "the number one thing is education and communication, no matter how many carriers; [employers] should have a solid marketing plan because statistics have showed the more the employees understand, the more they appreciate and utilize [voluntary benefits]," says Robert Shestack, national sales leader of employee benefits at Marsh, the largest insurance broker and risk advisor in the country. Marsh offers a one-stop website for voluntary benefits that is employer-branded with one telephone number directing employees to a representative who can talk through what the specific need is and which benefit should be used.
Another option is to place all voluntary options onto a company intranet site. Interpublic Group, a global marketing and communications services firm, does just that with its Hyatt Legal group plan. Pierina Miccoli, manager of benefits planning and design at Interpublic, helped bring Hyatt Legal on board in 2003 after employees requested it, and participation has been steady at 13% of its 16,000 U.S.-based employees. Though Miccoli hasn't looked into the specific ROI of the legal plan, she says the important factor is not hearing complaints from employees.
"It does help not having the stress of looking for an attorney. The ones that do participate are the ones that will need it, whether it's for a will or trusts. You don't want your employees to have legal concerns coming into work and doing research," she says.
Though it may be hard to directly link improvement of medical claim costs to implementing a legal or financial plan, the proof is in the productivity. A month ago, Shestack had a car run into his front yard and break through a brick wall - for the second time in three years. The first time, Shestack says he had to take time off to deal with getting payment from insurance companies. Since then, he signed up for Marsh's legal plan offering; with the second accident, the legal service has taken care of all the insurance issues, and Shestack hasn't missed any work.
"Typically, the higher-wage earners have an accountant [and] a personal insurance agent, but lower- wage earners don't have that. They don't have a financial planner managing their money. If they need to get an attorney, they don't know where to go, [and] try to do it themselves. Here, they can turn it over the to the legal plan," Shestack says. "I can just call the local attorney and let them take care of it; it's as simple as that."
Later this month in EBN June 15, the Open Enrollment Boot Camp series concludes with tips for selecting a wellness program provider.
Legal, financial and physical wellness linked
* 78% of employers say employees are less productive while at work when they are worried about personal financial problems; 58% say that financial stress contributes to employee absences.
* 27% of employees took unplanned time off or were distracted at work dealing with personal financial issues.
* From 2007 to 2011, overall legal plan usage in the category of debt and financial matters increased 120%. Specifically, legal plan usage for bankruptcy increased 167% and usage for debt collection defense increased 50%.
* Among employees who did not hire an attorney to assist with a legal issue, 43% said their physical and emotional health was negatively affected.
Sources: MetLife, Hyatt Legal Plans, Harris Interactive
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