Prudential's 4 best practices for open enrollment

August 29, 2023 2:51 PM

A young woman sits in front of laptop in her apartment.

Open enrollment decisions can make or break an employee's year, and yet for many Americans, it's just something to quickly check off their to-do list.

For Jillian Mondaca, head of enrollment at insurance company Prudential Financial, it's on employers to change those habits. According to Mondaca, employees on average spend less than an hour choosing their benefits for the year, despite these being one of the biggest financial choices employees will make for themselves and their families. Even Mondaca admits it's easy for her to underestimate the importance of open enrollment when it's her time to choose.

"We probably spend more time looking at a pair of shoes that we're going to buy versus medical coverage," says Mondaca. "How silly is that? Employees need to make informed choices during their annual enrollment."

That's where employers come in. Mondaca advises companies to offer more guidance to employees during open enrollment rather than assuming employees know what's best for them. Open enrollment shouldn't be an in-the-moment decision-making process, where employees are just clicking through their options — it should be a time where employees can reflect on their needs and their current phase of life, underlines Mondaca.

Here are four best practices employers should keep in mind for their next open enrollment period.

Once a year isn’t enough

While open enrollment is traditionally once a year, Mondaca believes this a big mistake. If employees get married, have children, get divorced, lose family or become chronically ill, the benefits they chose a few months ago will not reflect their actual needs and concerns.

"Unfortunately, companies have made this a one-time event," says Mondaca. "Here at Prudential, you can change your benefits when something changes in your life."

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Allowing employees to actively update their benefits pushes them to engage with said benefits instead of just picking them out once a year and forgetting about them altogether, notes Mondaca.

Be hands-on

Mondaca advises employers to alert their employees a week in advance that open enrollment is starting. Any sooner, employees will likely forget until they are a day away from the deadline. Then use that week to promote and inform employees about existing and new benefits, whether it's via video, social media, email or print — utilize several mediums that employees engage with regularly, explains Mondaca.

"Sometimes employers think that if they are hands-off in this process, that employees are just going to go and find the information they need," she says. "Employers who are willing to communicate in different mediums and make sure that you're paying attention to some of the changes that they're making in their benefit plan, have a much higher successful rate of employees actually completing enrollment."

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Employers should at least ensure employees have to actively re-pick their benefits each year, rather than having the option to roll over their previous year's choices, emphasizes Mondaca.

Provide the right tools

Especially when it comes to healthcare choices, employers shouldn't expect employees to pick those benefits without guidance. At Prudential, they partner with a company that analyzes an employee's medical plan details and provides a recommendation on ancillary benefits that could potentially be helpful, says Mondaca. Tools may come in the form of financial counseling or platforms focused on financial wellness too.

Be vocal about benefits that slip under the radar

In Mondaca's experience, the benefits employees often underestimate are short-term disability, critical illness coverage and hospital indemnity insurance, which protects employees from the financial costs that come with hospital stays. She encourages employers to raise awareness of these benefits so employees can better protect themselves from medical debt.

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"The common misconception is, my medical carrier will take care of all of that," says Mondaca. "But truth be told, more and more [healthcare costs] are being passed to the employee. Employees underestimate the fact that you get cash from those benefits that you can then use to pay off expenses in any way that you see fit."