It’s officially autumn, which means open enrollment for most businesses is fast approaching. Leading up to open enrollment, it always feels like there’s a mountain of to-dos and items to keep track of to get your organization ready for selecting benefits. The more proactive you can be before open enrollment kicks off, the better the overall experience will be for both your HR team and employees.
To help your business effectively plan ahead for open enrollment and provide a seamless benefits experience, there are two best practices your HR team should keep in mind. These two factors are the audit process to ensure your employees are properly enrolled and timing with the carriers providing the benefits.
Maintaining the benefits data of employees is one of the most critical and visible functions of the HR department. Open enrollment is that time each year when all the data changes, and with that comes the chance for things to go wrong. One of your strongest defenses against data mishaps is a good audit plan.
This planning starts during your open enrollment period. Make sure you are monitoring your employees’ activity through the benefits process and can follow up with employees who aren’t doing what’s needed. This process is much easier if you’re using an electronic enrollment system that can provide you with real-time reporting and automated reminders. At the very least, use paper spreadsheets to track the returned information; this will save time and help you avoid headaches later.
After benefits have been elected, it’s best practice to review your first carrier invoice in January (or the second invoice, depending on when you’re billed). Typically, a carrier will only allow retroactive changes 60-90 days after the effective date, so if you uncover an employee who should have a different plan or doesn’t have the right dependents covered, it’s important to make those corrections early in the year before your employee ends up without the coverage they expect or with costs they didn’t anticipate.
Timing With Carriers
As you work through open enrollment, it’s vital to understand the timing with your carriers. There are three main dates you should have full clarity on:
- When your final rates will be available
- When enrollment data is required
- When your Summary of Benefits and Coverage (SBC) or Summary Plan Description (SPD) is available
Let’s start with rates. When you’re making decisions about what plans you’re offering and what your employees will pay, you’ll rely on the rates from carriers. It’s important to be clear with your carrier or broker about when you will receive these rates. The timing is going to depend a bit on your company’s size. Larger employers typically can receive final rates earlier. Small employers may not receive final rates until October or November. Discuss this subject with your carrier, broker and enrollment partners to make sure there’s no confusion on when the information will be finalized.
The next most critical date is when enrollments are due. This is doubly important to know if you’re changing carriers or adding benefit plans, because you want to allow enough time for carriers to create and mail ID cards for the upcoming year. That way, employees will have them in hand prior to January 1.
In general, medical and prescription carriers will want to have all your enrollment information by the first week in December. Vision and dental tend to be a little more flexible and may not need enrollments until later in the month. As you’re planning your open enrollment dates, make sure you’re allowing yourself — or your vendor — enough time to gather the open enrollment data and transmit it to the carriers.
The third and final significant date is knowing when SBCs and SPDs will be available. This date is less critical if you’re renewing existing plans, but if you’re offering new benefits or new carriers, make sure you know when new vendors will have their summary information so that you can share it with employees in a timely manner.
SBCs are typically due at the time of enrollment or when enrollment materials are distributed. The deadline for SPDs is more flexible and can stretch into the next plan year, but you’re still responsible for confirming they’re ready to go when needed. For that reason, it’s recommended to ask your carrier about SPD timing and distribution methods so that you have a game plan ready.
Taking proper time to plan for these two major behind-the-scenes tasks ahead of open enrollment will give you and your HR team peace of mind when the season officially begins. At Creative Planning Business Services, we offer an all-in-one software that streamlines HR processes, including open enrollment auditing and reporting.
If you’re aiming to make your business’s open enrollment a smoother experience but aren’t sure how, we’d be happy to help. Contact us today to learn more about our software solution and range of other human capital management services.