We used to wait until “Black Friday” before we began to think about and shop for Christmas. Once again, the merchants didn’t wait until then. Even the radio stations seemed to jump the gun this year with their “all holiday” music agenda.
As notable as these events are to changing the focus of our lives for a few weeks, there is another part of this season that may be even more important for life-changing events. It is the season of benefit elections. Between the middle of November and the end of December, over two-thirds of the population will make decisions regarding their benefit plans. This includes retired and disabled people as well as those who are working.
Like it or not, more folks will be covered under government plans. More people are eligible for plans that require coordination of benefits. The options have increased, as well. It is a difficult process that is not getting any easier — and in all likelihood, getting more difficult. This holds true for the individual as well as the organizations providing the benefits. Regulations, costs, access and a whole host of issues come into play. It is clear that one solution will not serve everyone effectively.
As we become more diverse in our needs, the solutions have to become more diverse. When organizations first started dealing with the fact that “one size does not fit all,” some groups saw flexible benefit plans as the answer. That, however, usually required an organization of some size and a few resources. These plans worked well when the employee population was somewhat stable. All this has changed over the last few years.
Now we have to find some new approaches to addressing the benefit decision process. We also have to recognize that funding and managing benefits is a huge industry with lots of money involved. Many people and organizations have a vested interest. The key to making good decisions is knowing how to chose the benefit plan that will be the best value.
The term “best value” is the critical point. It means optimizing the money spent for the services received or potentially received to solve the needs of the recipient and purchaser. This doesn’t always mean the most expensive plan or the cheapest plan. It is the one that is “just right.”
Choosing what is just right depends on available options. It means considering the condition and needs of the recipient as well as considering the resources available. It may even involve looking at acute and chronic health issues. There are a very large number of variables.
This is not to say all these variables are new; they are not. But when health plans and health care was less expensive, we could get away with one-size plans, because people could manage the expense or had options to deal with those elements that fell outside the plan. So picking the “right” plan to get the “best value” becomes more important when there is more money involved in the process.
When you have lots of money in the process, you have more folks wanting to get a bigger piece of the pie. They need to differentiate themselves from the competitors so the consumer chooses them. Sometimes the things that are promoted to get the customer’s attention are important, and sometimes not. With all the marketing volume that one has to sort through, it requires a lot of education and knowledge to separate and prioritize the critical points and plug this information into the circumstances of the consumer.
If you can’t do this yourself or your organization doesn’t have the resources, you need to look for outside resources. They can be service providers, agents and brokers, consultants or even online services.
When you review these services, looking for the partner that can help you, consider two questions: How do they make their money? Can they or will they take the time to understand my circumstances? If the amount of money they make depends on how much or what they sell you: Buyer beware! If they don’t or can’t get the details about your situation to understand your needs, both current and potential future circumstances, how can they help you chose the right solution? Look for another resource.
With such a complex decision environment and so much riding on the decisions, if you aren’t comfortable making the decisions alone, then getting the right advisor or service is the critical decision. After you have done that, you can concentrate on what information is needed and who will do what steps.
The next step is an organized decision-making strategy. Start with your profile either as an individual or as an organization. Look at your historical data of the last three years. Determine if the data will be the same going forward for the next three years. Create a projection. Then determine what you are expected to need or use in the near term and what you have to build toward for the longer term. Make sure you assign priorities or weights on the various elements of your profile. (Keep it simple: high, medium, low, extra.) Create a spread sheet or have someone help you.
Once that is filled in, you can begin to fill in the plans that offer solutions. All the information is out there. Internet research and plan profiles should give you most of the information you need. Now compile, review and reach the best conclusions. Then you can take action with confidence and it will be the season to be jolly.
Ardon Schambers is a principal in the firm of P3HR Consulting & Services