Human Resources: EMPLOYERS USING BENEFITS ENROLLMENT SYSTEMSTO DRIVE EMPLOYEE BEHAVIOR CHANGE

WASHINGTON, D.C., February 21, 2008 — Employers are using their benefits enrollment systems to encourage employees to adopt healthier behaviors, a new survey by Watson Wyatt Worldwide, a leading global consulting firm, has found.

The survey of 117 U.S. companies conducted in December 2007, at the end of the annual enrollment process, found that more than half (53 percent) have incorporated health risk assessments into their enrollment systems or will incorporate these programs by 2009. More than one-third (36 percent) use enrollment systems to encourage employees to sign up for disease management programs or will do so by 2009.

“Open enrollment marks the one time each year in which most employees’ attention is focused on their benefits programs,” said Jeri Stepman, Watson Wyatt’s national leader for health and welfare administration. “Including behavior-change information and decision-support tools directly in the enrollment process can make a big difference in the number of people who sign up for wellness programs and take them seriously. Sending out information on healthy behaviors and asking employees to take the initiative is not nearly as effective.”

Employers Consider Integrating a Variety of Programs Into Enrollment Systems

Program or activity incorporated in enrollment process
now or planned for 2009

Considering for future

Health risk assessment
53%
32%

Disease management
36%
32%

Addressing tobacco use
29%
30%

Participation in onsite health screenings
26%
32%

Surcharge if spouses have access to other coverage
20%
21%

Exercise frequency or fitness center use
16%
32%

Weight or body mass index management
14%
36%

Despite these efforts, most employers have yet to make much progress in integrating their enrollment systems with other benefits-related resources, such as linking directly to an external health plan provider or health savings account/flexible spending account administrator. Although 67 percent have integrated their enrollment system with their HR portal or intranet, only 27 percent have integrated it with their health care provider’s system, which often contains robust information on disease management and healthy lifestyles. One out of three (30 percent) has not integrated their enrollment system with any other system.

A key aspect of engaging employees in their benefits — health care cost modeling — is the subject of some concern among employers. A significant portion of all respondents — more than 20 percent — are dissatisfied with their organization’s decision-support and plan-modeling tools. More than half of all respondents are either neutral or dissatisfied with the information provided to employees on managing health and health-related incentives.

“Signing up for health care benefits is a more complex process than it used to be,” Stepman said. “Integrating external vendors with internal enrollment systems is a win for both employers and employees. It makes it easier for employees to access the broad range of information they need to truly be engaged in their benefits. And it helps employers manage and reduce the complexity of the process in the long run.”

More information on the report, Navigating Enrollment: Leveraging Technology to Engage Employees, can be found at http://www.watsonwyatt.com/navigatingenrollment.

About Watson Wyatt Worldwide

Watson Wyatt (NYSE, NASDAQ: WW) is the trusted business partner to the world’s leading organizations on people and financial issues. The firm’s global services include: managing the cost and effectiveness of employee benefit programs; developing attraction, retention and reward strategies; advising pension plan sponsors and other institutions on optimal investment strategies; providing strategic and financial advice to insurance and financial services companies; and delivering related technology, outsourcing and data services. Watson Wyatt has 7,000 associates in 32 countries and is located on the Web at www.watsonwyatt.com.

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