Benefit Plan Administration Done Right

Businesses in every market are having to get more competitive in how they attract and retain top talent. A ping pong table and free snacks in the breakroom aren’t cutting it anymore, especially with the rise of remote work. This is where employee benefits come in to close the gap. And considering that 36% of employees don’t think their employer demonstrates commitment to their wellbeing, let’s just say that there’s a lot of room for improvement. As expectations grow, having the right strategies (and people) in place to manage employee benefits is more essential than ever.

What Is Benefit Plan Administration?

Benefit plan administration (occasionally called BPA) typically falls under the umbrella of the HR department and describes the various strategies, processes, and tools companies use to research, designate, budget for, manage, and analyze employee benefits options. 

Would it be easier to say that benefit plan administration handles benefits? Yeah, probably, but there’s just so much more to it. For one thing, in many cases the range of benefits being managed go well beyond just medical and dental. Benefit plan administration needs to be able to determine which plans are relevant, which ones specific employees qualify for, and how best to roll out and manage certain benefits or perks, including:

• Health insurance
• Vision insurance
• Dental insurance
• Life insurance
• Prescription/pharmacy benefits
• Mental health coverage
• Disability benefits
• Pet insurance
• Student loan assistance
• Vacation time
• Remote work options
• Transportation benefits
• Paid time off (PTO)
• Retirement planning
• Parental leave
• Other benefits options 

What is a benefits plan administrator? As the name suggests, they’re the ones who fulfill the tasks and responsibilities mentioned above — designing benefits and wellness programs, updating employee benefits packages, and may also participate in onboarding, benefits training, and assisting in enrollment. As mentioned above, benefits plan administration is a subset of HR. As such, benefits plan administrators often perform functions very similar to those traditionally associated with HR professionals. 

Why so much fuss? Well, when you consider that 83% of employees believe their wellbeing is just as important as their salary, it becomes pretty clear — team members want powerful benefits packages, and if they don’t get them, then they’ll walk. 

Oh, and there are also some regulatory issues to consider. 

What Is the Employee Benefits Security Administration?

The US Employee Benefits Security Administration (EBSA) is a federal agency within the Department of Agriculture charged with ensuring that employers provide their eligible employees with specific benefits and compensation packages. These benefits are called protected benefits and include things like retirement, health plans, and pensions. 

Look, we’re not going to get too deep into this right here, but if you want a more granular view into what the EBSA is, does, and the laws that back them up, just click here (and get ready to do some serious skimming). Suffice it to say that the EBSA provides services and educational resources to help you remain compliant with federal benefits standards.

What Does the BPA Process Look Like?

As you can see, there’s a lot that goes into benefits plan administration. But at its core, it’s about creating the kinds of benefits packages that can help your organization set itself above the competition. And although different companies employ different processes to make this happen, most follow a similar set of steps:

1. Research 

Even if BPA teams feel as though they’ve already got their fingers on the pulse of what makes a good benefits package, it always helps to supplement those instincts with empirical research. Start by working with your existing employees to better understand what benefits they value most (benefits surveys are a great way to get honest feedback without putting anyone on the spot). Then expand your gaze to take your competitors into account. What sorts of benefits are they offering? Are their employees satisfied with these packages? Can you match or beat what they’re offering?  

2. Define Your Budget

Every initiative requires an investment, and building a rad benefits package is no exception. Make sure that you have enough funds to give your employees the benefits they need (and want) by meeting with your company’s financial advisor. This is the stage where you can really start turning concepts into reality, so have your ideal packages already outlined. You can then set your budget, address basic benefits first, and finally fill in any corners with additional perks. Also, be aware that employees at different levels may have different packages; you’ll need to budget for those variations as well. 

3. Manage Your Program

Got the money all squared away? Know what your packages are going to include? Then let’s make it happen. Establish effective processes outlining how specific benefits tasks are to be managed and promote accuracy (and scalability) by investing in HR software. The goal here is to ensure that efficient and easy-to-follow processes are in place. That way, new employees won’t have to  stress about getting their benefits set up — they can just focus on stressing about how to do the job. 

4. Measure the Results and Make Changes.

Time skip! Ok, your benefits packages have been in play for a while now. Are they as powerful as you hoped? The only way to find out is to measure the results. Regularly review the packages by looking at key recruitment metrics, surveying your employees, and asking for feedback during employee exit interviews. This will not only tell you what is working, but will also give you a clearer idea of what could be working better. Then it’s just a matter of updating the benefits packages as needed. Easy peasy lemon squeezy.

Conclusion

What more is there to say? Benefits are important. And with today’s workforce ready to jump ship in search of something better, successful businesses are those that know how to keep their people engaged with the right kinds of compensation. Benefits plan administration is an approach designed to place those benefits (and the people who need them) on the top of the priority pile. After all, knowing how to attract and retain top people is just knowing what motivates them. 

Want to learn more about benefits and work-life wellness? Talk to a Wellbeing Specialist today.

References

• Employee Benefits Administration. BambooHR. Retrieved November 25, 2022 from https://www.bamboohr.com/hr-glossary/employee-benefits-administration/.
• Harter, Jim. (March 18, 2022). Percent Who Feel Employer Cares About Their Wellbeing Plummets. Gallup. Retrieved November 25, 2022 from https://www.gallup.com/workplace/390776/percent-feel-employer-cares-wellbeing-plummets.aspx.
• Laws & Regulations. U.S. Department of Labor. Retrieved November 25, 2022 from https://www.dol.gov/agencies/ebsa/laws-and-regulations.
• Murray, Jean. (March 30, 2021). What Is a Benefit Plan Administrator? The Balance. Retrieved November 25, 2022 from https://www.thebalancemoney.com/what-is-a-benefit-plan-administrator-5119505.
• The State of Work-life Wellness ‘22. (2022). Wellhub. Retrieved November 14, 2022 from /en-us/resources/report.
• What Is Employee Benefits Administration? Indeed. Retrieved November 25, 2022 from https://www.indeed.com/hire/c/info/employee-benefit-administration?co=US.
• What We Do. U.S. Department of Labor. Retrieved November 25, 2022 from https://www.dol.gov/agencies/ebsa/about-ebsa/about-us/what-we-do.