As consumers become increasingly comfortable taking responsibility for their health care and retirement benefits, more employers are making the move to online benefits management through Web portals.
MetLife’s 2003 Employee Benefits Trend Survey shows 51% of employers had implemented Web-based enrollment through online portals last year, up from 41% the previous year. This corresponds with a 2002 Forrester Research poll of large employers that found 64% had or soon would be offering benefits portals by 2004.
At the same time, however, it’s less than clear how enthusiastic employees are about using portals.
HR outsourcing vendors who provide portal technology say employee use is picking up.
“We have seen consistently over the last three years 100% compounded annual growth in online utilization,” Sachin Shah, vice president of Institutional eBusiness at MetLife, says. “Last year, through our portals, our clients did about 10 million transactions online.”
Benelogic, which counts the city of Baltimore, Md. along with Virginia’s Fairfax County government as clients, boasts online benefits enrollment through Web-based portals for its clients at over 93%, according to Stuart Spector, chief financial officer.
However, a 2004 survey of 12,171 households by Forrester Research reveals that utilization still is not where it could be. Of respondents who said their employers provide online benefit portals, just 60% had used them.
Brad Holmes, Forrester vice president and research director for Healthcare & Life Sciences, helped conduct the research suggesting that portals may not be living up to their potential. He attributes this to the type of people who are more inclined to use the portals.
“The people who are visiting these portals are more affluent, more educated, more technology adept, they’re more career-motivated. This is a tough crowd,” Holmes says.
Virginia Hutchinson, vice president of product management for Benefits and LifeWork with Ceridian, agrees “to some degree” with the Forrester survey findings.
“I think there was an expectation that a benefit portal could just be assigned and everyone would just go there magically,” Hutchinson says. “But the reality is it’s a whole other art/science to get people to use a benefit portal.”
“We agree that a majority of portals don’t deliver on their promise, mainly because it’s hard to keep the data up to date and usually it’s a technology that the company is implementing. Any time you’ve got those two factors, it delays the ability for a company to roll that out to their employees,” Beinke says. “Secondly, because many companies have to manage the upgrades themselves, there tends to be a delay in implementing new technology and adding new features to the portal.”
Employee Benefit Research Institute President Dallas Salisbury acknowledges the disconnect among the different types of users, but also notes that some people, regardless of their industry, just tend to be more comfortable with print media than online. He notes that a recent EBRI survey examined the differences in employees’ opinions of 401(k) information distributed online and in print.
“If you read into [the study] a little bit, it implies that people are interpreting the usefulness of portals as to whether or not it helps them do something as opposed to simply delivering information. If I access my 401(k) balance on the Web site, it doesn’t give me anything different than the printed statement, so people say they don’t really care whether they get this online or in print,” Salisbury says. “But what they are clearly saying is that they’d rather have somebody hold their hands than to work through financial planning alone on a portal. The catch-22 is the only way to deliver the equivalent of sophisticated information at very low cost to a very large population is through the Internet.”
MetLife’s Shah says portal use is at acceptable levels. “We’ve not experienced any lack of desire to use our portals; we’re right where we want to be with three years’ growth in use under our belt.”
At the same time, he acknowledges that some employers can expect greater utilization of the technology than others.
“White-collar industries are much more apt to be online, much more comfortable with electronic forms of communication with their employees and have fairly well-developed electronic communications within their companies,” Shaw explains. “As you move into gray- and blue-collar industries, utilization begins to drop off. But there is a growing trend in gray-collar industries of going online more for post-enrollment services. With blue-collar industries, it’s not a lack of desire to be online, it’s more the nature of the job. These are typically not jobs that involve getting on a computer on a daily basis, and so access becomes the number one barrier there.”
Designs of the future
With the market trending toward consumer-driven benefits, portals will be increasingly integral in benefits management and utilization. The challenge in getting more people to use them is twofold, Holmes explains.
“First and foremost, design portals for the more sophisticated people who are already using them, but also make sure you’ve designed for the less-sophisticated, less-engaged person. There’s a different set of approaches and value propositions that will be appealing to someone who is just getting started,” Holmes says.
“The second point is a marketing one. If you’re going to get people to use a portal, you’ve got to promote it in a cross-channel way. In other words, the people who you want to go online today to do anything are doing it on the phone or through email. You need to direct people through those channels into the self-service environment of a portal online.”
Holmes suggests the old method of carrots and sticks. For instance, he says, an employer could offer higher prescription drug co-pays if the employee uses the portal.
Hutchinson says Ceridian is working on more interactive and intuitive online tools so that people can get what they need easier and the portals are more customized to their particular situation.
“Like everybody else, we’re trying to create a better solution for customers, so we’re really listening to other employers, doing focus groups with them in trying to understand what’s working and what’s not,” Hutchison says. “We want to improve the intuitive side so that if, say, you just had a baby and you wanted to change your insurance to cover that, we would also provide you with wellness information around healthy baby tips and advice on balancing work and family.”
Employease is taking similar measures, says Jeff Beinke, vice president of product development strategy. “The key is to understand who’s using the portals,” he says, and recommends adding tools such as online wizards, or devices that walk people through, say, an entire process be it enrollment or account management.
Benelogic, which focuses on health care, is talking to insurance carriers about getting their their provider directories, which can then be incorporated into one central portal.
“For example,” Spector says, “most companies link out to the insurance company’s provider directory. So let’s say you have an HMO and you have to sign up with a primary care physician. We actually now have the technology that will call up an insurance company’s provider directory. So it’s not just a link to another Web site, it actually grabs that information from another Web site and brings it to the user. That type of technology has a lot of merit, and if we continue, we’ll eventually be able to pull claims status and medical management information so employees will be able to get all of this in one central portal. The technology’s there, it’s just a matter of getting it organized and, of course, getting somebody to pay for it.”
MetLife also puts a premium on researching users’ attitudes, likes and dislikes.
“Benefits are not things that people like to interact with. They don’t sit there and think about their benefit offerings or their life insurance or their dental plans. They do sometimes think about their 401(k) plans, but that kind of ebbs and flows with the market,” Shah explains. “Either way, the interactions that people want with their benefits are limited and focused in that it’s a singular thing; I want to look up a claims status; I want to find a provider; I want to enroll in a benefit offering.”
Shah says of utmost importance to people in their benefit interactions is that they are simple, easy and fast.
“For us, that says a lot about how we design our capabilities and we do constant usability tests on them,” Shah says. “We have a guiding rule of thumb for our information technology gurus, which is One click, and gone.’ What we look to do is to design our capabilities so that within one click and a maximum of two or three, the individual is provided the information they’re after.” – S.B.