The pandemic has revealed the financial devastation inadequate health coverage can bring. The median cost of COVID-related hospitalization for those 23 to 60 years old without insurance was $34,662 to $45,683, according to a July study by Fair Health. With insurance, this range dropped to $17,094 to $24,012.
With numbers like these, it’s no wonder American workers are planning to take a closer look at their voluntary workplace benefits this open enrollment season.
Recent research by Voya Financial reveals that more than two-thirds of American workers intend to spend more time reviewing their voluntary benefits ahead of open enrollment, and more than half plan on making changes to their elections. For financial advisors, this means open enrollment 2021 may bring new opportunities and responsibilities in guiding your clients through the enrollment process.
We spoke with Mona Zielke, senior vice president of employee benefits claims and operations at Voya Financial, on what advisors should expect and how they can help clients navigate this unprecedented open enrollment season. Here are edited excerpts from that interview.
What changes do you expect from consumers this open enrollment season as a result of the pandemic?
With (the global health crisis) as part of our daily lives for the foreseeable future, many Americans are worried that they could get sick. In fact, Voya research shows that more than half of Americans (52%) believe someone close to them will be infected with the virus. Therefore, a major focus for many American workers during this fall open enrollment period is financially protecting their family from unexpected medical expenses.
A good way to achieve this goal is by taking a closer look at their workplace benefits offered by their employer. However, prior to the global pandemic, American workers typically did not prioritize open enrollment. For example, industry research shows that employees, on average, spend only 17 minutes electing their benefits during open enrollment. To provide some context, Netflix users spend an average of 18 minutes on any given day deciding what to watch.
As a result of COVID-19, many Americans are now rethinking and reevaluating potentially untapped benefits offered by their employer.
Do you think employers and plan providers will do anything differently in response to these changes?
Many companies are now operating with few employees in offices this year. This has many employers shifting from face-to-face conversations to a more virtual approach during open enrollment. At Voya, we’re seeing our employer clients asking for assistance to help coordinate virtual enrollment fairs and provide more digital support, such as webinars, on-demand videos (and) Zoom calls.
We’re also seeing a growing trend of employers asking their benefits providers for help targeting their open enrollment communications. While it might seem obvious, focus groups show that working Americans have different needs and expectations when it comes to learning about their workplace benefits. For example, some employees want every single detail, while others just want the big picture. Therefore, when our employer clients design their communications strategy, we are helping them consider ways to serve both these audiences.
What should financial advisors do to prepare for open enrollment season?
Typically, when employees prepare for open enrollment, they spend the majority of their time focused on their core workplace benefits: medical, dental and vision. While important, this open enrollment season, financial advisors also need to be prepared to answer questions and help educate their clients on voluntary workplace benefits.
A new Voya survey finds that when asked which employee benefits would help better manage their current needs, health savings accounts or flexible spending accounts were mentioned by nearly four in 10 surveyed employees (38%), followed by 35% of employees selecting supplemental health benefits like hospital indemnity insurance, critical illness insurance, or short-term and long-term disability income insurance.
Plus, voluntary workplace benefits can help protect your client from unexpected medical costs.
In my experience, most people don’t realize the affordability of their voluntary workplace benefits. This is where a trusted financial advisor can help. For example, hospital indemnity insurance, which pays a daily benefit when you have a covered stay in a hospital, usually costs less than a six-pack of toilet paper per week. And that money can be used for child care, groceries or help around the house – it’s up to you. As a financial advisor, helping to educate your clients on how to maximize their workplace benefits – especially in the midst of a global pandemic – can be a critical piece in your client’s broader strategy when helping them plan for their holistic financial wellness needs.
How can advisors help their clients navigate open enrollment?
In addition to educating your clients on the value of their workplace benefits, finding ways to engage with them will be critical. Yes, face-to-face meetings are now almost entirely through a webcam, but one might argue that the ease of videoconference technologies, like Zoom, has created more opportunity to stay connected. Being able to see someone’s virtual working environments, meet pets or children, or even doing virtual lunches has opened the door for opportunities to connect with clients and each other in ways we may have never imagined previously.
It also leaves room to check in more frequently. For example, if you normally have a weekly call, perhaps it’s worth turning that into a video call, or checking in with your clients in addition to those calls via one-off emails just to see how they are doing in between. This not only shows clients that they’re still a priority for you, but also helps make sure they don’t forget about the importance of the partnership.
And while I realize many people are eager to return to in-person meetings, technology will likely play an increasingly larger role in client interactions. Voya research recently found that more than a third of Americans (34%) believe technology will have the greatest impact on the way they save or invest in the next five years. Therefore, investing the time and energy to get comfortable meeting with your clients virtually can be a win-win. It helps your clients navigate an unprecedented open enrollment season, while also serving as another way to engage and educate your clients in the future.