As U.S. employers strive to balance cost management with providing greater value to their employees, enhancing the annual healthcare enrollment process with more choices and guided decision-making can effectively achieve both goals.
Key Insights
Offering a range of health plan options during the U.S. annual enrollment creates a competitive marketplace, leading to reduced costs for both employers and employees.
A competitive enrollment process allows employees to select plans that best meet their and their families’ needs, which may change from year to year.
With more carriers and plan options available, guidance tools become essential to help employees choose the right plan.
In Aon’s 2024 U.S. Health Survey, employers highlighted the importance of increasing healthcare accessibility, reducing costs, and expanding options. However, the challenge lies in balancing these priorities while managing expenses and investing in employee benefits. Annual healthcare enrollment presents an opportunity for employers to lower costs and enhance benefits simultaneously.
Expanding Plan Options to Drive Savings
One effective approach is to present employees with multiple plan options and carrier choices during annual enrollment. Data from Aon’s Benefit Experience shows that introducing more carriers and plan options can decrease overall plan costs. When paired with decision-making tools, employees are empowered to select plans that best fit their current needs.
In a traditional, single-carrier model, life changes—such as relocation—can create concerns about provider availability and access. Offering greater choice in carriers alleviates these concerns and boosts employee satisfaction.
Corey Morenz, Senior Vice President and Benefit Experience Practice Leader, Health Solutions, North America, noted, “More suitable and cost-effective health plan choices enhance employees’ health and wellbeing by ensuring they have access to the right plans.”
Enhancing the Enrollment Experience
Here are three compelling ways to improve the annual enrollment process, leading to cost savings and a better benefit experience for employees:
1. Improved Financial Decisions
Decision-making tools guide employees toward selecting health plans that align with their financial situations. Tools like Aon’s “Help Me Choose” incorporate algorithms to evaluate factors such as Health Savings Account (HSA) balances, unexpected healthcare costs, and household income. This predictive modeling helps employees make informed financial decisions by considering potential expenses, payroll deductions, and out-of-pocket costs.
Employees who used Aon’s selection-support tool during enrollment saved an average of $423 in premiums annually compared to those who did not.
2. Choosing the Right Insurance Carrier
Providing a variety of health insurance carriers enables employees to weigh the tradeoffs between in-network providers and costs. Effective selection tools also display consumer ratings for each carrier, helping employees reconsider their choices if a plan has lower reviews. With more carriers and plans available, employees can select providers that align with their preferred doctors, health needs, and prescriptions.
Aon research shows that 20% of employees change their plan or carrier annually when using Aon’s Benefit Experience.
3. Adapting to Changing Life Circumstances
Employees can personalize their coverage to fit their evolving needs, whether investing in an HSA for future healthcare expenses, choosing richer plan designs while building a family, or balancing medical contributions with other benefits. Accessibility also plays a crucial role, as employers increasingly focus on addressing healthcare inequalities. Over one in four respondents in Aon’s 2024 U.S. Health Survey plan to offer travel or relocation benefits to facilitate access to necessary medical care.
Aon research found that 94% of U.S. workers prefer having more choice in healthcare carriers.
Case Study: Flexibility in Health Plan Choices
A food service organization with 6,000 employees across the U.S. sought to optimize its benefit offerings under new leadership. Their goals included increasing plan flexibility, enhancing the employee experience, and reducing administrative complexity while controlling costs. By leveraging Aon’s Benefit Experience, which offers multiple carrier options, the organization drove down health plan costs and improved flexibility in plan choices. This strategy also allowed the firm to outsource benefit administration, ultimately saving over $2 million, or 6.6% of total medical costs.
Strengthening Employee Value
Empowering employees with choice and comprehensive guidance during health plan selection is critical to improving access and affordability. By offering a range of plans and carriers, along with effective decision-support tools, employers can help their workforce make choices that promote better health outcomes and financial stability.
Tools that enhance the annual enrollment process give employees control over their healthcare journey, contributing to an improved employee value proposition.
B.J. Givens, Senior Vice President, Health Solutions, North America, emphasized, “Empowering employees with the right tools and choices in health plans is key to driving better health outcomes and financial stability for them.”
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