7 ways LSAs drive engagement in employee benefits communication
Know how to use Lifestyle Spending Accounts (LSAs) to drive engagement in employee benefits communication and ROI.
The importance of employee benefits communication
With many prepping for open enrollment, benefits professionals and HR leaders are heads down executing launch and implementation plans. It’s important to note that the upcoming cycle looks to be different. Because of rising medical costs and inflation, there are signs that employees will be taking a more active role in their benefit selections and usage.
72 percent of employed Americans agree that, because of inflation, they will spend more time reviewing their benefit elections during open enrollment to help them get the most from their options.
For many, enrolling and decoding benefit communication is stressful and confusing. So how can companies cut through the noise to make benefits communication easier and more engaging? With the right strategy, you can transform employee benefits communication from a necessary evil into an opportunity to empower employees. The key is utilizing Lifestyle Spending Accounts (LSAs) to catalyze engagement.
Using LSAs as a driver in employee benefit communication
LSAs can provide the missing piece to drive record-breaking engagement during and after open enrollment. The flexible benefit is fundamentally different from other programs. LSAs provide personalized support. Employees can use funds at their discretion to support their lifestyle.
Unlike core medical, dental, and vision benefits that are used on an as-needed basis (e.g., a trip to the ER, dental cleaning, eye exam), people actively engage with their LSAs and use the benefit to support their personal lifestyle needs. The use cases are endless from workout classes to daycare, student loans, PPE, emergency relief, and more. The flexible construct gives way to endless options that can easily align with personalized needs.
7 ways LSAs drive engagement
There are many advantages to LSAs. Below is a list of the benefits that can be used as a driver for engaging employees.
1. LSAs can offset the cost of rising healthcare premiums.
LSAs are employer-funded and require $0 upfront from the employee. LSAs can be used to incentivize employees to make more prudent enrollment decisions that are mutually beneficial to the employer and employee. People view LSAs as a bonus or extra cash. However, unlike a bonus that goes right into your paycheck, employees are empowered to select and use funds based on their lifestyle.
+ This point can be especially powerful in alleviating financial stressors and providing support.
2. LSAs accommodate personalized needs.
There are multiple use cases for LSAs. With the added flexibility LSAs offer, companies can provide inclusive benefits that support individual needs at scale. For example, not every employee is going to value a membership to Gold’s Gym, but with an LSA some employees may be able to use those funds to pay for a dietician or to take dance classes that they’re passionate about. Employees appreciate that they get to choose and spend benefit funds on what matters to them.
+ This can be a clear way to demonstrate the company’s investment in its employees and their personal needs.
3. LSAs give employees more choice and agency in how they use their benefits.
This is a fundamental shift in how most organizations provide employee benefits, perks, and rewards. Oftentimes, benefits are given and used as needed only. Whereas with LSAs, employees benefit by actively engaging and selecting what they want to use based on their personal preferences.
+ This can be a forcing function to incentivize employees to engage in not only their LSAs but all their benefits.
4. LSAs align with company values.
Employees give half of their awake time to their employers. Some see these experiences as just a means to a paycheck, but many employers and employees want more. Flexibility and choice are the keys to making benefits much more meaningful. As such, LSAs have a positive impact on company culture, attracting talent, and keeping engaged employees.
+ This can be a value driver where employees feel appreciated AND appreciate being given benefits dollars.
5. LSAs complement core healthcare benefits.
While employers set the criteria for what is/isn’t eligible, LSAs can pick up where the core benefit programs leave off by providing holistic support. LSAs are proven to be an essential part of competitive benefits offerings that help increase employee advocacy, nudge employees toward their development, and give them something they truly find meaningful.
+ This can be impactful in terms of employee retention/attraction.
6. LSAs help reduce stress and improve productivity.
Benefits at the core exist to help employees meet some of their most basic needs and provide them (and their families) with a baseline sense of security. Programs that lack flexibility and choice may not alleviate stress or offer adequate support for all of your employees. Because LSAs help provide more meaningful benefits, employees are more likely to have their core needs met. Focusing on the many use cases can be a helpful tool to showcase the value of the benefit itself.
+ This helps employees stress less and be more productive.
7. LSAs remove usage barriers.
When administered through a modern TPA provider, the LSA UI is accessed instantly via digital means. Today’s software is built with a keener understanding of consumer-grade design principles. With a central hub, users no longer have to struggle with learning the ins and outs of some 10+ point solutions.
+ This improves UX, streamlines communications, reduces software support questions and drives utilization.
Providing meaningful support for employees
By consolidating vendors, and improving the employee experience, a newer generation of TPA providers can support all the necessary tasks. Plus, modern HRtech includes payroll integrations, claims adjudication, compliance work, vendor management, currency conversions, and more. This way, benefits professionals can focus on more strategic initiatives. Overall, LSAs and modern HRtech deliver a better experience for all parties involved.
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