Digital tools to ease global employee benefits cost containment challenge
Data analytics has been identified as a key tool to reduce and manage costs for global employee benefits
Data analytics and digital tools will ease the global employee benefits cost containment challenge, according to research commissioned by MAXIS Global Benefits Network, (MAXIS GBN) the international joint venture between MetLife and AXA.
Multinationals warned that the key challenges include the pressure to reduce costs, but still provide benefits that support and retain staff, and managing employee benefits across a global organisation, which is often decentralised.
MAXIS GBN said local insurance firms highlighted that product commoditisation, low interest rates, increasing loss ratios and procurement-led purchasing are putting pressure on margins to the point that in some markets multinationals are switching EB providers for minimal cost savings.
Looking forward, multinational employers highlighted four opportunities to address market challenges:
- Data excellence: focus on claims data and trends, as well as identifying what factors are driving claims volumes;
- Preventative measures: for instance, health and wellness programmes and educating the workforce to improve health and reduce claims;
- Sophisticated but easy-to-use digital tools, for both employers and employees; and
- Flexible benefits: offering employees a choice of benefits so they can decide on the best benefits themselves.
Employee benefit consultants also identified ‘data’ – particularly using data to manage claims – as the biggest opportunity to help reduce costs, followed by preventative measures such as health and wellness programmes.
One objective, for instance, should be for organisations and consultants alike to be able to access data digitally on the web via real-time dashboards and reporting tools.
Employees are increasingly used to managing and receiving their benefits online or via mobile apps so the aim is to simply integrate the backend claims process
The study found that data management solutions are allowing corporations to identify issues such as why claims in one jurisdiction are so high, with brokers offering guidance on accident prevention programmes to reduce claims volumes.
Powerful aggregating tools and forensic data analysis are enabling brokers and their clients to identify if, for example, a specific occupational issue is driving claims, or why in a particular country there are so many disability reimbursements.
Mauro Dugulin, CEO of MAXIS Global Benefits Network said: “Data – and the development of digital tools to collect and manage this data – have become key in the race for excellence in EB management. Our research clearly demonstrates that the increased application of analytics will help address the biggest market challenge, which is cost containment.”
The research was conducted by an independent market research agency on behalf of MAXIS GBN and canvassed views from multinational employers, global employee benefits consultants, and local member insurance firms.