Employee benefits communication: year-round strategies

Twenty-three percent of people with health insurance can correctly define coinsurance.¹

That number comes from a Forbes Advisor survey of 2,000 insured Americans, and it explains a lot about why benefits go unused. Most people never learned the vocabulary their benefits are written in, and most are never offered the chance to. In EBRI's survey of just over a thousand workers, 37% said their employer or benefits company provides no benefits education at all.²

An employee benefits communication strategy that's year-long could be the solution to help employees learn what they have and how to use it.

Why employee benefits communication has to run all year

Most benefits communication happens in a three-week window starting in September, because that's when the enrollment deadline typically falls, depending on the employer.

Open enrollment is the one stretch of the year when every employee has to make a decision at the same time, so the messages get built to drive elections before the window closes. Once enrollment closes, there's no deadline left to write communications against, and sometimes, for the other 49 weeks, most employees receive no benefits communication at all.

Where limited benefits communication leaves gaps in understanding

• An employee broke their ankle in July: Their accident plan pays cash for exactly that, and nobody has mentioned it since they elected it 10 months ago, so no claim gets filed.
• Someone got their first real bill in February: They're four months past the only explanation of their high deductible plan they ever got.
• An employee is still sitting on an FSA balance in November: Nobody explained the deadline, so the money goes back to the employer in December.

The relationship between benefits education and plan choice

A study in the Quarterly Journal of Economics looked at 23,894 employees at a large US firm and found that 61% selected a health plan costing more than an available alternative in every possible health outcome. The plans they picked cost more no matter how the year turned out, whether they used a lot of care or none at all. That came to $372 a year each, on average, in premiums and out-of-pocket costs they had no way to get back.³

The same team then ran a controlled experiment with 603 people to find out whether a lack of understanding was the cause. Participants who were given an explanation of how the plans worked before choosing behaved differently:

• The share picking a plan that cost more in every scenario fell from 48% to 18%
• Among people who scored well on every insurance-literacy measure the study used, fewer than 2% chose one of the more expensive plans

Explaining the plans clearly cut high-cost choices by nearly two-thirds. That gap is what benefits education is meant to close, and the study shows how much it's worth to employees when it's done before they choose.

How personalized communications change benefits understanding

A separate field experiment, also published in the Quarterly Journal of Economics, tested something different: how benefits information is personalized. One group got a letter with personalized rates and costs in it, showing what their current plan was costing them, the cheapest plan available to them, and what they'd save by moving. The other group got a general letter pointing at the website where all of that same information already sat, free, for anyone who went looking.⁴

The lesson carries into a year-round strategy. An employer sending one message a month can shape each one around who's receiving it and when the topic is live for them, which puts those messages closer to the personalized letter than the general one.

Employee benefits communication across a full year

There's really no reason benefits education has to happen in three weeks, other than limited bandwidth from the person building the messages. An employee who has been learning how their coverage works since the day they joined arrives at enrollment already knowing how their deductible works and what an HSA is for.

Year-round means one relevant message a month, as a minimum, plus four more communications that go out regardless, tied to when something unique happens to one person.

A 12-month benefits communication calendar

The calendar below is a sample, built for a January 1 plan year. It shows how a year-round strategy plays out over 12 months, with each message tied to what employees are dealing with at that point in the plan year.

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Two of those messages, March and December, have real money behind them. Across 3.2 million flexible spending accounts, about half of account holders forfeited funds back to their employer, averaging $441 each.⁵ Across 15.2 million health savings accounts, only 18% had invested in anything other than cash, so most of the tax advantage goes unused.⁶ In both cases, the money already belongs to the employee, and a single reminder is what unlocks it.

The four year-round emails with no set date

There are four emails that have no fixed date throughout a year-round strategy, because, as we mentioned above, each of them depends on an event triggering. HR managers already know this, but every year-long employee benefits communication program should plan to cover all four of these messages as they come up:

• New hires: Someone joining in April gets an enrollment window of their own, starting from their hire date, and they're making the same decisions everyone else made in the autumn. There's no run-up, no reminders, and nobody else in the office is talking about it.
• Qualifying life events: A marriage, a birth, a divorce, a dependent aging off. Each one opens a short window to change elections, and most employees use it to add or remove a person without asking whether the plan itself still fits.
• Plan or carrier changes: Mid-year network changes and formulary updates land as a surprise at the pharmacy counter unless somebody says something first.
• Terminations:  People leaving need to know what happens to their coverage, their FSA balance, and their COBRA options, and it's the easiest message to leave out of a calendar built around enrollment.

How to automate a benefits communication strategy

Done by hand, each message means writing it, working out who should get it, and remembering the date. That's really only part of the job, too. HR teams get it done; it just costs hours that come out of everything else on their desk.

Automation can take the writing, the list-building, the timing and the sending off HR's plate, so they have time to actually strategize the year-round messaging instead of using all the time creating the emails themselves.

Automated campaigns by email and SMS

In Pasito the HR team can write their own, start from a template, or have the campaign content generated and edit it from there. Open enrollment, new hire, and termination campaigns all come ready to generate. New hire and termination campaigns are set up once and keep running on their own, and open enrollment campaigns follow the OE dates in the plan year settings, so they come back each year without being rebuilt.

Pasito runs the whole communication calendar as automated campaigns. Messages go out by email and SMS under the employer's name and branding, with full control over the content. Segmentation tools send different versions to different groups, so a 24-year-old with no dependents and a 48-year-old with three each get something useful. Triggered campaigns run on set criteria, including a new hire, a termination, a pay increase, or an employee looking at life-event content.

Employee benefits education in every Pasito message

An email can only say so much, but it can importantly serve as a launching pad to send employees to a central location with the information they need. Through Pasito, they'd land on their benefits microsite for anything about their coverage, decision support during enrollment when the point is choosing a plan, and the AI benefits assistant for the question the message didn't answer, around the clock, in their benefits portal or in Slack and Teams, from the employer's own plan documents.

The short version

Health plans are hard to understand on their own terms, and most people are left to work them out alone. Remember from earlier that 37% of workers say they get no benefits education from their employer or benefits company.² When employees get that explanation, the choices that cost them money drop by nearly two-thirds.³ That's the whole argument for spreading benefits education across the full plan year.

A year-round employee benefits communication strategy, at a minimum, includes sending one relevant message a month. The sample calendar above is a place to start and can be an effective way for HR teams to help employees stay better informed about their benefits and make better decisions in the long run.

FAQ

What is employee benefits communication?

‍Everything an employer sends employees about their coverage: what the plans are, what changed, what a deadline is, and how to use what they have. Most of it happens at open enrollment, and it works better spread across the plan year.

How often should employers communicate about benefits?‍

Once a month is enough for scheduled messages, with four more that go out when something happens to one person: a new hire, a qualifying life event, a plan or carrier change, and a termination.

What should a benefits communication calendar include?

‍A benefits communication calendar sets one topic per month against what employees are dealing with at that point in the plan year. Deductible reset in January, HSA and FSA mechanics in March, the enrollment sequence in the autumn, and FSA deadlines in December.

Is open enrollment communication enough on its own?

‍No. Open enrollment communication reaches everyone at once, and it lands in the three weeks when people are busy choosing rather than learning. Anyone who joins, has a life event, or meets a real bill outside that window gets nothing.

References

1  Forbes Advisor. Health insurance literacy survey, June 29 – July 1, 2022. n = 2,000 Americans with health insurance.
2  Employee Benefit Research Institute. 2018 Health and Workplace Benefits Survey. n = 1,025 workers aged 21-64.
3  "Choose to lose: health plan choices from a menu with dominated options." Quarterly Journal of Economics, 2017;132(3):1319-1372. n = 23,894 field study, n = 603 experiment.
4  "Comparison friction: experimental evidence from Medicare drug plans." Quarterly Journal of Economics, 2012;127(1):199-235. n = 406, Medicare beneficiaries aged 65+.
5  Employee Benefit Research Institute. EBRI FSA Database, 2022. 3.2 million accounts.
6  Employee Benefit Research Institute. EBRI HSA Database, 2024. 15.2 million accounts.