Here are four suggestions for steps to take in choosing the right benefit admin system:
1. Make sure it is not attached to a carrier.
This is a GA talking now. At first I wanted to roll out our own exclusive system that you would have access to for free when writing business with us. I now realize that model will be extinct in a few short years. As you grow into this space you're going to need to write whatever carrier on your chosen system. It won't work to have five cases with Blue Cross' system then another three with Metlife's system and another four with Priority Health. I guess it will work but it's not the most efficient. Spend the money, find a partner, get really good at that one partner and use the heck out of it.
We'll work on making it easy to do business with us on the back end.
2. Make sure it does what they all should do.
HR Onboarding--it should allow your groups the ability for new hires to complete their W2's, I9's, employee information, etc. This is no brainer stuff but some of the platforms just don't do it. The good ones allow for electronic signatures then communicate all the information to payroll. Seamless for your clients. Good information for you to have on eligible employees.
3. Cost--how much should you be paying for this thing?
The new companies seem to want to move you to the subscription status versus a PEPM. Employee Navigator does this. EaseCentral starts at $250 per month and that will get you 1000 lives on the system. But then they charge for the HR Onboarding and Hotlines. $199 monthly and $30 bucks a case respectively. You can do the ACA tracking at .50 PEPM and you can connect to a payroll vendor at $1.00 PEPM. So it all adds up. Others will charge you $7 to $8 PEPM to do all of that. When I bottom line it for small to mid size agencies, be prepared to spend $500 to $750 per month on the system. And you will have sweat costs into that too from you or your staff.
If that shocks or scares you, remember you don't have to do it for free. Zenefits says it's free but they charge for the ACA tracking and some of the payroll capabilities. Half their income comes from fees. Free doesn't always equate to value. I'd say if you charged your clients $2.00 PEPM for the system with the HR Onboarding and Payroll connectivity, that would be one heck of a value.
Or maybe instead of charging your clients, you simply add voluntary products. All the studies have shown employees want more choice. The benefit admin system allows you to roll out products they want and generate more revenue to pay for your investment.
4. What's the support? Am I on my own here?
Most systems offer training to teach you or your staff how to build and administer the cases. But once they set you free, you are on your own. The carrier based systems help a bit more but you lose some control. We at Benefit Profiles are working to develop ways we can support you in the build out and back end administration. More to come on that!
5. Where do I start?
Talk to me! I've done quite a lot of research and I can steer you in the right direction. We do have a partner we like we hope would be a nice fit.