Telling Employees About Health Insurance Rate Changes
It’s Open Enrollment and you have unwelcome changes to deliver – you’re changing providers, premiums are going up, or the perfect storm of stressful, both. It’s time to tell employees about their health insurance rate changes. As a company, Sentric recently went through this very situation, and our HR team did a few things that 1) I appreciated as an employee, and 2) respected as a communicator.
If you’re weighing your options for delivering bad news at open enrollment, here are a few ways you may soften the blow:
Be transparent – This goes hand in hand with communicating early and often (see point #2). Our HR department gave us the heads up as soon as the premium increases came back from our provider. We were told how much the increase was, the plan to shop the business, the commitment to trying to minimize the financial impact without compromising the quality of coverage, and despite all of that, we still might see huge increases. The message was simple (point #3), premium hikes are coming and we’re doing what we can. The dread was real, but at least we felt like we were all on the same side.
Communicate Early and Often – If you’re concerned about minimizing the impact on morale, or making sure you share only accurate information, this may seem counter-intuitive. But resist the urge to wait until days before open enrollment to share the changes. If the writing’s on the wall for a price increase or vendor change, a heads up and continued updates will do three things:
- First, you give people the maximum window to plan for the change. They may not be able to review formularies or networks, but they can look for places to personally save money, analyze prior year claims and see whether they could have made different choices, educate themselves on high deductible plans (if appropriate), explore a spouse’s plan, and squeeze in appointments, procedures, and refills before the next plan year begins.
- Second, you create a credible platform for explaining company goals and priorities. Credibility is built on trust, and telling employees early that you have their best interests in mind, a plan to review other options or a compelling reason to make a change makes it more believable when the final decisions are made. Look at it like this, if your doctor told you ahead of a surgery they were removing your adenoids, and after told you they removed your tonsils, too, would you think they were planning on doing the latter all along or that the missed something or something went very wrong in the operating room? You’re far more likely to trust the surgeon who tells you it looks like they’ll need to remove both, but if they get in there and it doesn’t look necessary, they’ll leave the tonsils.
- Third, and perhaps most importantly, communicating early lets you control the conversation. Speculation, gossip and water cooler conversations gone wrong happen when emotions run high. If you try to explain the “why” (your key message) with the “what,” (the bad news), you’ll have to also deal with the knee-jerk reactions that go with anything that impacts someone’s paycheck or health.
Find Your Message and a Story – You probably already know that people remember a fraction of the content they’re taught. But poor information retention isn’t just a training challenge – it’s also a communications one. Assume that when you have a lot of information to convey, the average person will remember less than 25 percent within a week. Your goal is to actively choose what they will remember.
Before you start communicating, figure out the most important thing you want your employees to feel / think / do during or after Open Enrollment. Do you want them to make an educated decision? Do you want them to know that a higher premium / deductible or new carrier is inevitable? Do you want them to know how invested the company is in providing a robust benefits package? Do they need to understand that the company had a rough year and shifting some insurance costs will save jobs? Do you want them to start taking advantage of your company wellness program and incentives?
Once you’ve defined your communications goal, think about the message to deliver it. Make it pithy, simple, and as single-minded as possible. Consider that message your communications umbrella and whatever additional details you need to cover are delivered in such a way that they reinforce that message. Repeat your message often, remind people of it, put it in headlines, subject lines, on your office kitchen bulletin board.
If you don’t choose what you want them to remember, they’ll cherry pick the materials and content that suits their preconceived notions or opinions.
Use Email Sparingly – Use company-wide email for documenting prior conversations, following up to something you already said was coming, or putting something in writing for future reference. Email for announcing this kind of news is a mediocre vehicle. Instead, create a company town hall, visit department meetings, or host a webinar. In our office, it was good to see and hear expertise, effort and emotion. Face-to-face communication also made follow up conversations easier to start and concerns easier to express. Plenty of emails circulated, but we were expecting them, knew what to look for when we got them and no one was blindsided.
Educate, educate, educate – Fewer than 2 percent of people can correctly define all four terms associated with insurance costs – premium, deductible, copay and coinsurance. Sixty-four percent want to save money on health insurance but don’t know how. No matter how many times you’ve sent emails or they’ve gone through open enrollment, most people still don’t understand health insurance, spending accounts, voluntary plans or how they all work together.
Bring in your broker to answer questions, have a confident / respected employee ask the things you think most people are too embarrassed to ask, cover the basics, require attendance at benefits meetings. Use concrete examples of what could happen. Tell (anonymous) stories about some of the great things you’ve seen people do or have done yourself.