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Self-service benefits management: Find the best vendor

by on
in Employee Benefits Program,HR Management,Human Resources,Leaders & Managers,Management Training

Issue: Outsourcing can provide a low-cost way to add online self-service capabilities to your benefits administration.

Benefit/risk: Self-service can help you manage your benefits, but the wrong vendor can create usage and security problems.

Action: Use the questions below to select the best vendor for your needs.

If the words "open enrollment" conjure up nasty images of endless employee questions, piles of paperwork and time-eating interruptions, you owe it to yourself, and the organization, to check into online self-service benefits.

Instead of knocking on your door every time they need to add or change a benefit, self-service lets employees tap the Web to manage their benefits. Advantages: streamlined enrollment, lower administrative costs, faster response ... and more time for you to handle other matters.

Some organizations upgrade their employee intranets to handle self-service benefits administration.

A better approach: Outsource the task to an HR application service provider (ASP) that offers Internet-based self-service benefit tools. Outsourcing is typically less expensive and easier than customizing an internal system. And it puts self-service benefits administration within your grasp even if you work for a small organization.

Dozens of ASPs offer this service. Three leaders: Benelogic (www.benelogic. com), Employease (www.employease.com) and EbenX (www.ebenx.com).

Advice: Capabilities and delivery quality vary widely among ASPs. Use the following questions to help you find the one that will improve your benefits process, not add to your hassles:

  1. How easy is the self-service interface for employees to use? Take the system for a test drive, and ask several employees to try it out, as well. Are the on-screen directions self-explanatory? Can employees find online assistance if they encounter problems? What type of training will the ASP provide to you and employees?
  2. Does the ASP maintain links with your insurance and benefits providers? Some outsourcing vendors establish relationships with only certain providers. If your carrier isn't already on the vendor's provider list, nail down guarantees on how quickly the ASP can set up a working link. (Even better: Ask your benefits providers for a list of their vendor connections before you begin shopping.)
  3. What is its reliability and uptime? Employees will quickly grow frustrated if they often find the system down or running slow. And you'll be frustrated if the vendor sends the wrong names to the wrong insurance companies. ASPs should be willing to share stats about speed, reliability and the percentage of time the system operates.
  4. How secure is information in the system? Employee benefits data are highly sensitive. Look for encryption systems that protect data as it moves between your site and the vendor, plus firewall protection and virus-prevention policies and practices. What's the vendor's plan for disaster recovery? Best bet: Ask your IT department to verify that the vendor's security measures are adequate.

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