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Originally, only large employers with more than 25,000 employees had the resources and capability of using an automated benefits enrollment program. Often, these programs were built as an add-on to their existing enterprise resource planning systems and required large investments in technology and personnel to manage.
Today, the world of benefits enrollment has changed dramatically. In 2003, 12% of employers offered an automated enrollment program, according to a survey by Mercer Consulting, New York. Employers with 500 to 999 employees had a 22% electronic enrollment rate.
There are currently several vendors offering outsourced enrollment solutions to employers with as few as 200 and as many as 300,000 employees. An outsourced enrollment solution combines efficiency and scalability unavailable 10 years ago.
Choosing a benefits enrollment vendor is a big decision and should not be taken lightly. There are several successful vendors that have the ability to sell you based upon their marketing collaterals alone. Beware of the impulse buy, and follow this basic procedure when comparing vendors:
The most important question you should ask is: Who owns the data? It is crucial to have either the broker or client own the data. Providers who offer enrollment solutions also try to own your data, keeping you from moving the business from them easily. Data ownership provides your clients with the ability to change vendors and bring their existing data with them in the event they are not satisfied or need to change.
In addition, the data should have a live backup at a remote site in the event of Internet connectivity, hardware failures, or other disasters and should carry 128-bit data encryption.
It also is imperative that the software be able to capture enrollment data for multiple carriers and transfer them easily. It must be flexible enough to change, especially when dealing with clients who may make minor changes on short notice.
While price is definitely important, it should not be the decision-maker. Ownership and neutrality are crucial for brokers to provide service in the best interest of their clients. Price structures typically are based on an annual license fee with a per member, per month fee. Also, frequently written into contracts is a minimum number of employees enrolled, which is used to discourage the smaller brokers.