For WorldatWork Members
- 5 Ways You Can Reduce Workers’ Open Enrollment Regret, Workspan Daily Plus+ article
- Wellness Woes: Why Aren’t Employees Using Your Benefits? Workspan Daily Plus+ article
- Getting Benefits Enrollment Right: Big Trends Spark Fresh Strategies, Workspan Magazine article
For Everyone Else
- Most of Your Workers Will Likely Regret Their Open Enrollment Choices, Workspan Daily article
- Employees Don’t Understand Their Health Plan: That’s a Big Problem, Workspan Daily article
- Strategic Communication in Employee Benefits, course
Odds are that more than half your employees regret the choices they made during last year’s open enrollment period. But what if artificial intelligence (AI) could help reduce (perhaps even eliminate) those regrets and allow for more satisfactory selections?
Last year, nearly 96% of employees enrolled in benefits through digital channels, according to a 2024 annual enrollment analysis by Alight, a human capital data and technology company.
“AI promises to transform how we deliver benefits, from personalized plan recommendations to automated support,” said Karen Frost, the vice president of go-to-market strategy for health at Alight. “It can never fully replace the guidance, empathy and high-touch support delivered by highly trained humans — AI should enhance, not replace, the human touch.”
Access a bonus Workspan Daily Plus+ article on this subject:
Using AI to Avoid Enrollment Confusion and Regret
Employees often regret their open enrollment selections because 85% of them consistently don’t understand their benefit offerings in the first place, said Don King, the head of total rewards at Businessolver, an employee benefits administration technology company.
Additional research found almost 40% of employees don’t know where to get information about picking the right health plan, and younger and lower-paid workers lack confidence in their benefit selections.
“Living in a state of benefits confusion is the reality for most employees,” King said.
He pointed to three key challenges:
- Jargon and complex terms make it difficult to understand coverage and compare options.
- Benefits communications only occur once a year.
- Communication methods aren’t customized to meet employee needs.
Many existing tools, such as themed benefit guides, mobile apps, benefit fairs and meetings, simply fall short, said Dan Maass, a principal and senior client executive at OneDigital.
“The content is often too complex, and decision tools frequently steer employees toward the highest-deductible, lowest-cost plans,” he said. “Employees tend to over-insure, choosing plans they believe are the best option but are ultimately overspending.”
In addition to the complexity of the healthcare system and general lack of health literacy in the United States, employees may fail to consider life changes that could impact what benefits would best fit their situation and needs.
“Living in a state of benefits confusion is the reality for most employees.”
— Don King, head of total rewards, Businessolver
Most employees spend less than an hour electing workplace benefit coverage, according to Tim O’Connor, the vice president of HR technology partnerships and enrollment services at Prudential Group Insurance.
“Insurance [health, life, critical illness, accident, etc.] is something employees purchase with the hope they won’t have to use it,” he said. “Consequently, insurance is a topic people often don’t want to spend much time thinking about.”
Personalization Changes the Game
By personalizing benefits communication, AI can step in and assist total rewards leaders.
“With today’s workforce becoming increasingly diverse, it’s evident that employers must move beyond a one-size-fits-all approach,” Alight’s Frost said. “AI provides the foundation for creating a personalized employee experience at scale — from new-hire onboarding to [enrollment] and healthcare benefits [usage].”
In addition, OneDigital’s Maass noted large language models (LLMs) allow employees to ask questions in a natural conversation, without fear or confusion.
“We see employees asking things like, ‘What is a deductible?’ or ‘Is RBP [reference-based pricing] a scam?’ — questions they might hesitate to ask otherwise,” he said.
Maass added AI also enables side-by-side comparisons of a spouse’s benefits plan and costs, a process that was once only accessible to the most informed buyers.
“By understanding an employee’s unique needs, AI goes beyond just recommending the lowest-cost plan — it helps them choose the right plan for their family,” he said.
Receiving Immediate Assistance
AI tools such as chatbots or virtual assistants can allow employees to ask relevant questions in real time. For example, Businesssolver’s AI-powered virtual benefits assistant, Sofia, is available 24 hours a day, seven days a week. King shared 32% of Sofia’s chats happen after hours or on the weekends, and she can resolve 90% of issues on the same day.
“Not only can [Sofia] deliver on-demand answers to benefits questions precisely when employees need it, but she simplifies complex information into common, understandable language,” King said. “She can recognize when an employee appears to be feeling certain emotions and respond appropriately, even asking contextually relevant follow-up questions.”
King added they also found that employees are three times more likely to enroll in ancillary and voluntary benefits, such as accident insurance, critical illness or hospital indemnity, when they have immediate decision support, making AI a potential powerful tool to boost active enrollment.
A Word of Caution
Even though AI can play a major role in delivering a targeted and timely employee experience when choosing benefits, Frost said employers should carefully consider data privacy and security, compliance with evolving regulations and potential biases in the algorithms that train the data, which can affect the communication that employees receive.
“Done right, AI promises to improve the benefits experience, making it simpler, more relevant and more efficient,” she said. “But the importance of the high-touch human element is crucial to this success and can’t be overlooked. Pairing a high-tech experience with high-touch opportunities is key.”
Editor’s Note: Additional Content
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