7 strategies for boosting employee benefits adoption and engagement

Every HR professional has faced that moment of disappointment, where they launched an impressive benefits package only to discover months later that utilization hovers around 30%. All that careful planning, vendor selection, and budget allocation seems wasted when employees aren't taking advantage of what's available to them.

The truth is, simply offering great benefits isn't enough anymore. Your workforce expects personalization, accessibility, and genuine value from their benefits programs. Companies that crack the code on engagement aren't just throwing money at trendy perks; they're strategically designing experiences that connect with employees' actual needs and removing friction from the process.

This article goes beyond standard advice and features seven proven strategies that transform benefits from overlooked options to valued essentials. We've analyzed companies that have achieved exceptional adoption rates and distilled their approaches into actionable tactics you can implement right away, regardless of your company size or current benefits structure.

Key takeaways

• LSAs are post-tax, employer-funded, and fully customizable, making them more flexible than traditional benefits, but also requiring clear, strategic guidelines to avoid confusion.
• Eligible LSA expenses typically cover physical fitness, mental health, financial wellness, home office setup, education, and family support, empowering holistic employee well-being.
• High-impact LSAs align with company values, such as sustainability or professional growth, and reflect real employee needs through continuous feedback and clear communication.
• Tracking LSA usage helps optimize benefits strategy, revealing what categories matter most and providing data to support ROI and retention outcomes.
• Forma simplifies LSA delivery through global scalability, automated compliance, real-time reporting, and personalized support, making flexible benefits easier to manage and more impactful. Schedule a demo today.

Why does benefit adoption and engagement matter

Benefit adoption and engagement matter because they directly impact the return on investment (ROI) of your benefits program and the overall employee experience. When employees actively use the benefits offered, it means those programs are meeting real needs, whether it's reducing financial stress, supporting mental health, or encouraging professional growth. 

High adoption signals alignment between the company’s offerings and employee priorities, which strengthens retention, satisfaction, and loyalty. 

Conversely, low engagement can indicate poor communication, irrelevant offerings, or administrative friction, resulting in wasted resources and missed opportunities to support your workforce. 

Engaged employees are more likely to feel supported, valued, and motivated, which in turn contributes to better performance and lower turnover. Monitoring engagement also provides critical feedback that helps refine your benefits strategy over time. 

In short, adoption isn’t just a usage stat; it’s a reflection of how well your company understands and supports its people.

Benefits of high benefits adoption

When your workforce actively engages with and utilizes the benefits you offer, everyone wins. High benefits adoption positively impacts both individual employees and the organization as a whole.

1. Improved employee well-being

Employee well-being is a multifaceted concept that encompasses physical, mental, and financial health. When employees take advantage of the wellness programs, health insurance plans, and financial benefits available to them, they are better equipped to manage their overall well-being.

For example, regular check-ups and preventive care can help catch health issues early, while access to mental health resources can provide support during challenging times. Financial benefits like retirement planning and student loan assistance can alleviate stress and promote long-term financial stability.

2. Enhanced productivity

Employees who feel supported by their benefits are more likely to be engaged and productive at work. When your team knows they have the resources to manage their health, well-being, and personal lives, they can focus more fully on their job responsibilities. Providing initiatives like a remote work spending account can further boost productivity by giving employees flexible support that meets their evolving needs.

Comprehensive benefits packages demonstrate your company's commitment to employee well-being, fostering a positive workplace culture. This, in turn, can lead to increased motivation, creativity, and collaboration among your workforce.

3. Increased retention

High benefits adoption can be a powerful tool for improving employee retention. When your team recognizes the value of their benefits and feels supported by your organization, they are more likely to stay with your company long-term.

A strong benefits package sets your company apart from competitors and shows your employees you are invested in their well-being and professional growth. This can help reduce turnover, saving your organization time and resources associated with recruiting and training new hires.

4. Cost savings

While offering a comprehensive benefits package requires an upfront investment, high adoption rates can ultimately lead to cost savings for your organization. When employees utilize preventive care and wellness resources, they are more likely to maintain good health and catch potential issues early. This can result in reduced healthcare costs over time.

Additionally, when employees are engaged and productive, your organization can operate more efficiently. High retention rates also contribute to cost savings by reducing expenses related to turnover and onboarding.

Common challenges in benefits adoption

Despite your best efforts to provide a comprehensive benefits package, you may still face challenges with employee adoption and engagement. Here are some reasons why your employees aren’t making the most of your benefits program.

1. Low awareness

One of the primary reasons for low benefits adoption is simply a lack of awareness. Your employees may not know the full extent of the benefits available to them, especially if you offer a wide range of options or have recently introduced new programs. 

Without a clear understanding of what's offered, your team can't take advantage of the resources designed to support their well-being and professional growth. 

2. Complexity

Employee benefits plans can be intricate and confusing, with jargon-filled documents and complex eligibility requirements. When faced with a deluge of information, many employees may feel overwhelmed and disengage from the process altogether. 

This complexity can lead to misunderstandings about coverage, costs, and how to access benefits, further discouraging adoption.

3. Perceived irrelevance

Not every benefit will resonate with every employee. Depending on factors like age, family status, and personal interests, certain offerings may seem irrelevant to some members of your workforce. 

For example, a young, single employee might not see the value in dependent care benefits, while an older employee nearing retirement may not be interested in student loan repayment assistance. When benefits don't align with individual needs, adoption rates can suffer.

4. Insufficient communication

Clear, engaging communication is key to driving benefits adoption. If your company isn't effectively conveying the value and details of your benefits package, employees may remain in the dark. Infrequent or overly technical communications can fail to capture your team's attention and leave them uncertain about how to enroll or utilize their benefits.

Without a strategic, multi-channel approach to benefit communication, you risk leaving your workforce uninformed and disengaged. Personalized, targeted messaging that highlights the relevance of specific benefits to different employee segments can go a long way in boosting adoption rates.

Strategies for boosting benefits adoption and engagement

Let's explore seven proven strategies that can dramatically increase your benefits engagement rates and deliver more value from your existing programs.

1. Offer Lifestyle Spending Accounts

Traditional table stakes benefits often feel like giving everyone the same sweater, regardless of size or style preference. Lifestyle Spending Accounts (LSAs) are a fresh take on this outdated approach. These employer-funded accounts let your team direct their benefits dollars toward what actually matters in their lives, whether that's therapy sessions, a gym membership, or professional development courses.

The benefit of LSAs lies in their versatility. Your new grad might use funds for student loan payments while your mid-career parent allocates theirs to childcare or college savings. This personalization doesn't just boost engagement; it shows employees you recognize their individuality rather than treating them as interchangeable assets.

If you’re looking for a partner to implement LSAs, Forma makes it remarkably straightforward, handling the complex tax compliance, global scaling, and administrative heavy lifting that often deters companies from offering these high-impact benefits. 

With Forma, you can design flexible benefits programs that align with your culture and give employees the freedom to choose what matters most to them, whether it's wellness, professional development, family care, or personal growth.

Our platform streamlines everything from fund distribution and claims processing to tax handling, employee education, and real-time reporting. Employees enjoy a seamless experience with multiple payment options, while HR teams gain powerful tools to manage, optimize, and measure program performance without administrative overload.

If you're ready to offer benefits your employees will actually use, and love, Forma is the partner that makes it possible. 

Schedule a demo today and learn more about how we can help you create a benefits experience that drives engagement, retention, and long-term impact.

2. Improve communication

You could offer the most generous benefits package in your industry and still see dismal adoption if employees don't understand what they have or how to access it. Effective communication isn't about bombarding people with information; it's about delivering the right message through the right channel at the right time.

Move beyond the dreaded annual benefits presentation and create a year-round conversation. Use brief, visual explanations that connect benefits to real-life scenarios. For example, when explaining HSAs, show how pre-tax dollars could fund next summer's family vacation or help manage a chronic condition.

When you partner with a flexible benefits provider like Forma, this communication burden doesn't fall entirely on your shoulders. It’s the benefit providers’ responsibility to communicate the details to your employees. Forma specializes in translating benefits-speak into plain language that resonates, with automated touchpoints that keep your offerings top-of-mind without being intrusive.

3. Encourage Employee Feedback

The quickest way to boost engagement is to actually listen to what your people want. Many companies make the mistake of building benefits strategies based on industry benchmarks rather than their unique workforce needs. Regular pulse surveys, focus groups, and anonymous feedback channels provide invaluable intelligence about what's hitting the mark and what's missing entirely.

The critical step many organizations miss is closing the feedback loop. When employees see their input translating into tangible program changes, they become invested in the process. Something as simple as "You asked for more wellness options, so we've expanded our LSA categories to include mental health apps and sleep improvement tools" demonstrates responsiveness that builds trust.

Advanced analytics platforms provide insights beyond what employees say, showing you what they actually do when given choices. This data-driven approach helps you continually refine your strategy based on genuine utilization patterns.

4. Include Your Entire Workforce

The hybrid workplace has exposed a troubling benefits divide: onsite employees often enjoy perks that their remote colleagues can't access. Similarly, frontline workers frequently miss communications that desk workers receive. True engagement requires equitable access for every team member, regardless of location, role, or work arrangement.

Take an honest inventory of who might be falling through the cracks in your current approach. Are your communications reaching third-shift workers? Can field employees easily submit claims from their phones? Do international team members have comparable options to headquarters staff?

Modern benefits platforms bridge these gaps with mobile-optimized experiences, multi-language support, and currency flexibility across multiple countries. When every employee has an equal opportunity to participate, engagement naturally rises across your organization.

5. Offer Incentives for Participation

Sometimes even well-designed benefits need a little promotional push. Strategic incentives can overcome initial hesitation and create the momentum needed for sustained engagement. Consider offering modest rewards, like additional LSA funds or company swag, for completing benefit orientations or submitting their first claims.

The goal isn't to bribe employees into using their benefits but to reduce the activation energy required to get started. Once they experience the value firsthand, the external motivation often becomes unnecessary. Think of incentives as training wheels that can be removed once the habit forms.

Implementing these incentive programs becomes simple with tracking tools that automatically recognize participation milestones. By celebrating small wins, you normalize benefits usage and create cultural expectations around wellbeing.

6. Incorporate Benefits into the Onboarding Process

The average new hire is bombarded with 174 pieces of information during their first week. In this cognitive overload, the benefits details often get overlooked or forgotten. Effective onboarding treats benefits not as an administrative checkbox but as a cornerstone of your employee value proposition.

Instead of overwhelming new team members with comprehensive benefits information on day one, consider a phased approach. Introduce core offerings immediately, then schedule benefits check-ins at the 30, 60, and 90-day marks when employees have the bandwidth to truly engage.

A streamlined onboarding process with personalized welcome sequences can guide new hires through their options at a manageable pace. By making benefits education an integral part of your onboarding journey, you establish healthy engagement patterns from the start.

7. Celebrate Success Stories

Nothing drives adoption quite like seeing peers reap tangible benefits from the programs you offer. When your marketing director shares how an LSA-funded financial planning session helped her create a debt payoff strategy, or your software engineer explains how wellness funds supported his marathon training, benefits transform from abstract concepts to real-life enhancers.

These narratives work because they're relatable and specific. They help employees visualize how they might use similar benefits in their own lives and often reveal options they didn't realize were available. Consider creating a dedicated channel for benefits success stories or featuring them in company communications.

Identifying usage trends and success patterns across your organization can help surface these powerful stories. By amplifying positive experiences, you create a virtuous cycle where engagement continually reinforces itself.

Measuring the success of your benefits adoption strategies

Implementing strategies to boost benefits adoption is an important step, but how do you know if your efforts are paying off? Measuring the success of your benefits adoption initiatives is essential for understanding what's working, what's not, and where there's room for improvement.

Track participation rates

One of the most straightforward ways to gauge the success of your benefits adoption strategies is to monitor participation rates. Keep a close eye on enrollment numbers for each benefit offering, as well as utilization rates over time.

• Are more employees signing up for health insurance during open enrollment? 
• Have you seen an uptick in the number of employees contributing to their 401(k) plans? 
• Are your wellness programs seeing higher levels of engagement?

Tracking these metrics will give you a clear picture of how well your benefits are resonating with your workforce.

Analyze employee feedback

Numbers don't always tell the whole story. To gain a deeper understanding of how your employees feel about your benefits offerings, it's important to gather qualitative feedback as well.

Regularly review employee surveys, focus group insights, and one-on-one conversations to identify areas where your benefits are excelling and where they may be falling short. Look for common themes or pain points that emerge from employee feedback.

To strengthen your program’s effectiveness, it’s also important to measure and optimize your employee benefits ROI, ensuring that your offerings align with both employee needs and business objectives.

Are there certain benefits that employees consistently rave about? Are there others that generate confusion or frustration? Use this feedback to inform your benefits strategy and make data-driven improvements.

Evaluate health outcomes

Another key indicator of benefits adoption success is the impact on employee health outcomes. If your workforce is actively engaging with your wellness programs, preventive care benefits, and mental health resources, you should see positive changes in overall health metrics.

Look for trends like reduced sick days, lower rates of chronic disease, and improved scores on health risk assessments. Healthier employees are more likely to be productive, engaged, and loyal to your organization.

Keep in mind that these changes may take time to manifest, so be patient and consistent in your efforts to promote wellness.

Closing thoughts - The importance of engagement rates

Engagement rates are more than just a metric; they're a direct reflection of how well your benefits strategy is connecting with your people. High engagement means employees understand, value, and use the support you’re offering. 

It signals that your investment is driving real outcomes like improved well-being, stronger retention, and a more satisfied workforce. On the other hand, low engagement often highlights gaps in relevance, communication, or accessibility that deserve immediate attention.

That’s why tracking and optimizing engagement isn’t optional; it’s essential. A benefits program only works if your employees are using it.

Forma is built to help you turn engagement into action. Our flexible benefits platform offers fully customizable Lifestyle Spending Accounts, paired with real-time usage data, automated employee communication, and seamless administration. With Forma, your team gets more than just tools. They get benefits they’ll actually use, and support they’ll remember.

Schedule a demo with Forma today and learn more about how we can help improve your benefit utilization rates.

*This document is for informational purposes. Forma is not engaged in the practice of law. Nothing contained herein is intended as tax or legal advice nor to replace tax or legal advice from counsel. If you need tax or legal advice, please consult with counsel or a certified tax professional.

‍