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8 ways to trim marginal benefits, max out those that work

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in Employee Benefits Program,Human Resources

In today’s pared-to-the-bone business environment, you shouldn’t be wasting time or money offering benefits no one cares about.

If you haven’t already, says benefits consultant Gary Kushner, now’s the time to review all your benefits, take a magnifying glass to your coverages and conduct eligibility audits.

Kushner advises taking these eight steps to maximize the value and reduce the costs of the benefits you provide:

1. Dump unnecessary benefits.
Kushner recommends regularly asking yourself, “Why do we offer this benefit?” If it doesn’t help recruitment or employee retention, get rid of it.

2. Examine PTO designs.
Take a fresh look at leave plans that progressively increase time off the longer an employee has been with the organization. Standard amounts of leave for all employees are easier to administer. Kushner urges considering paid-time-off banks.

3. Analyze retirement plan designs (and fees).
Study up on the brokerage fees your employees have to pay to maintain their retirement investments. If they’re too high, you’ll hear about it from financially savvy workers who are studying their statements in great detail now.

4. Conduct eligibility audits. Make sure you’re insuring only those who are eligible for your coverage. Kushner says about 8 to 10% of those enrolled in employer-provided health insurance plans are ineligible—mainly employees’ adult children. Your insurance carrier or broker can help you do an audit.

5. Review health plan coverages.
Spend some time talking to your carrier about coverage you may not want to pay for. Most insurers will be happy to underwrite experimental or unproven medical procedures, but you’ll pay a hefty price. Kushner cites gastric bypass surgery as one popular, expensive and often-ineffective procedure you might want to bypass paying for.

6. Determine cost sharing wisely. Think creatively about who pays how much for what. Could you ask higher-paid staff to take on larger co-pays and deductibles? It might make it easier to offer affordable coverage to the rank-and-file.

7. Make sure your prescription plan covers what you want.
Some plans generously cover drugs to treat erectile dysfunction and hair loss, yet scrimp on diabetes meds. “The last thing you want is employees failing to take the medications they need because they’re too expensive,” Kushner says. “That will raise your costs in the long term.”

8. Scrap one-size-fits-all designs.
Standard plans for everyone companywide made sense at one time—like 50 years ago! Changing demographics and lifestyles require a different approach to benefits. “Today, only 9% of the workforce looks like Ozzie and Harriet,” Kushner says. Get to know your workforce to understand the mix of benefits that will best serve your employees without busting your bottom line.

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