Switching benefits administration providers: Key insights for a smooth transition

As we near open enrollment, many employers are considering whether or not they should change benefits administration providers. From evaluating new vendors to ensuring a smooth transition for employees, Lisa Bauer, director of implementation here at WEX, joined our Benefits Buzz podcast to discuss practical tips and expert insights to help make the changeover as seamless as possible. Here’s a deep dive into what you need to know to ensure a successful transition. And don’t forget to check out our Benefits Buzz podcast episode below. 

When is it time to switch? 

There are two primary indicators that might signal it’s time to consider a new benefits administrator:

1. Service issues: If your current account team isn’t meeting expectations, with slow responsiveness, high turnover, or a lack of personal engagement, it might be time to explore other options.
2. Increasing errors: Frequent transaction errors or issues with payroll files are red flags that your current provider may not be meeting your needs effectively.

How to evaluate a new provider

1. Assess service quality: Ensure that the new provider’s team aligns with your company’s service expectations. High-quality customer service is crucial in benefits administration.
2. Evaluate technology and tools: Look for tools that engage employees throughout the year, not just during open enrollment. Check for robust analytics, reporting capabilities, and transparency in the system.
3. Understand their culture: The provider’s company culture should match your own. Meeting with their operations leadership, beyond just the sales team, can give you insight into their ability to address your specific pain points.

Navigating the transition challenges

1. Data integrity: One of the biggest challenges during the switch is ensuring data accuracy. Engage with your HRIS team and the new vendor early to address any data issues before they become major problems.
2. Communication: Keep your HR professionals informed throughout the process. Over-communicate about timelines, potential system blackouts, and new features to minimize disruptions.

Best practices for a smooth transition

1. Detailed planning: Collaborate closely with your new provider’s implementation team. Provide comprehensive documentation on your benefits and employee population to aid in a seamless setup.
2. Monitor key metrics: After the transition, pay attention to data integrity and security, and track payroll accuracy and call center volumes. These will be indicators of how well the new system is working and where adjustments might be needed.

Leveraging the change 

Switching providers is not just about a new system—it’s an opportunity to reassess and enhance your benefits offerings. Use this transition to address any previous shortcomings and ensure that the new system meets your company’s unique needs.

“A change in benefits providers and implementation onto a new system and service is a great way to reevaluate what is and is not working for you as a company with your current provider,” said Bauer on our podcast.

While switching benefits administrators can be complex, with careful planning and clear communication, it’s possible to make the transition as smooth and beneficial as possible. 

Interested in more benefits administration content? Check out our benefits engagement guide!

The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers. 

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