The wheels of time have certainly impacted company benefits over the years. Benefit plans have become more sophisticated and complex to manage, particularly for benefits professionals.
Today’s benefits managers are responsible for researching, coordinating, and managing health, wellness and retirement benefits, flexible spending, employee leaves, and so much more. It’s a lot to manage and many organizations have even larger benefits portfolios that include tuition reimbursement, pet insurance, and other plans. When the cost of errors can include fines, loss of coverage for an employee, or overpayments to carriers, benefits managers have to pay special attention to every detail, deadline, and update to benefits regulations.
Even for the most seasoned benefits pro, there’s still a chance of mistakes or errors. With this in mind, we’re sharing 5 typical workplace scenarios that can shake up even the best-run benefits departments. Examine this list to see if your current system or process is capable of overcoming these common benefits mishaps. We’ll also share some of the solutions that have helped our clients address these scenarios.
1. When an Employee's Dependent Turns 26
Scenario: In keeping with the Young Adult provision of the Affordable Care Act, an employee’s dependent turned 26 and was dropped from their parent’s health insurance by the carrier. However, benefits and payroll systems didn’t communicate, and the payroll system continued to deduct premiums for a dependent who was no longer covered. Moreover, the 60-day COBRA enrollment window opened and closed for the dependent without anyone knowing, because the proper notifications weren’t made to the employee or payroll system. To make matters worse, the 26-year-old dependent had a chronic heart condition, making it more challenging to find coverage elsewhere. After all was said and done, the employer was held responsible for the dependent’s medical costs, which were expected to be massive. Is your benefits platform sophisticated enough to catch and prevent this scenario from occurring?
The Fix: In this scenario, what’s needed is technology that communicates between your payroll, HRIS system, and benefits carriers, ensuring that all necessary parties are alerted proactively. That’s exactly what our COBRA administration solution offers. We do it by establishing an electronic bridge between our clients’ HRIS and their benefits carriers to automatically identify, track, and respond to all qualifying events. Unlike other COBRA services, which require a call-in or login to receive notifications of a COBRA qualifying event, our COBRA solution does this automatically and proactively, taking the burden of compliance off of our clients’ shoulders.
2. When a Terminated Employee Continues to be on the Benefits Plan
Scenario: We see the following scenario on a fairly regular basis and it can amount to a big financial loss for a company. A terminated employee was removed from payroll, but not from the company’s benefits plan. By the time the error was uncovered, almost a year had passed—a year of non-recoverable expenses.
The Fix: No company wants to find themselves in the predicament of paying for benefits for a terminated employee. However, it does happen and often on a larger scale in companies with a large employee population. Rather than manually checking carrier invoices against payroll records each month, our automated Benefits Reconciliation solution can quickly identify this and other discrepancies. Our solution automatically reviews your premium invoices against your company's payroll deductions to look for under-deductions, under-coverages, over-payments, payments on terminated employees and other discrepancies – all in a matter of seconds!
3. When Documents are Lost
Scenario: No-one wants to lose paperwork, but it does happen. Perhaps the organization moved, changed benefits administrators, or misplaced an old file. In this scenario, an employee’s dependent life insurance document was lost. Then, the employee’s spouse passed away. As a result of the loss of proof of insurance, the business owner ended up having to compensate the employee for the benefits owed.
The Fix: Digitizing every aspect of benefits is the best way to ensure you’ll never lose an important document. Our Benefits Enrollment solution completely eliminates paper forms and manual processes and can work for businesses of any size. Our solution creates a digital paper trail reflecting accurate dates, names, and enrollment numbers, so that no ball gets dropped and important information is easy to find. When it comes to life insurance and other benefits requiring proof of coverage, all pertinent information is system-based, printable, and reflects carrier records. Paper can get lost, but automated records are saved, archived, and protected.
4. When a Company Pays on Ineligible Dependents
Scenario: As health care costs continues to rise, many companies are looking for ways to contain these costs. One area where companies are starting to uncover hidden expenses is in the cost for health insurance for ineligible dependents (such as employees cousin). According to a recent SHRM article, dependent-eligibility audits typically find that up to 12% of covered dependents are ineligible. This translates to real dollars for a company, not matter it’s size.
The Fix: Our automated Dependent Eligibility Audit allows you to audit a random sample or your entire employee population to determine benefits eligibility. Our preconfigured templates make employee communications pre-, during, and post-audit simple and clear. Secure document upload functionality ensures sensitive documents such as marriage or birth certificates and other legal documents are protected at all times. Are you ready to trim down your expenses?
5. When a Company Misses the 401(k) Employer Contribution
Scenario: The company 401(k) plan is a great retirement planning tool for employees, but it’s also governed by complex ERISA rules and other regulations. Some of the most common 401(k) violations can result in fines, including for failure to make a timely matching contribution to all participants by the deadline. In this case, a simple oversight can lead to what could otherwise be an avoidable expense.
The Fix: Managing your 401(k) program can be challenging, especially with all the reporting, annual testing, and deadlines you can’t overlook. Our 401(k) Integrations solution can help you stay in compliance, and also helps to save on the time it takes to efficiently manage the company retirement plan. Clients who use our 401(k) Integrations solution can integrate their payroll system with their retirement vendor’s system, and easily keep track of employee contributions, matching contributions, and important deadlines. 401(k) plan management made easy!
What we offer:
Whether you’re looking to automate your benefits enrollment process, streamline your COBRA or 401(k) plan administration activities, trim down expenses with a dependent eligibility audit, or catch billing discrepancies, we’re here to automate “everything benefits” for your business. Take a look at our benefits solutions here and schedule a demo to get an up-close look at how we can help you transform benefits administration for good.
EverythingBenefits proudly serves over 3,000 organizations in automating all aspects of their benefits, eliminating paperwork, and keeping them in compliance.