A prospective customer recently asked what obligations they might have to their employees in a dependent audit. The question was noteworthy because they were not interested in their legal obligations, they were asking for best practices to meet moral obligations to their employees in the process.
Here are the top 10 Moral Obligations employers owe their employees in a dependent audit.
Ample time to verify dependents: Some employers make the mistake of launching a dependent verification project with very little notice to employees beforehand, and only give employees 2-4 weeks to produce documentation. In these projects a higher-than-average number of eligible dependents are removed. These false-removals end up added back into the plan at a later date, creating unnecessary stress for both the employee and the HR Benefits team. Better to give employees ample notice ahead of the project and/or ample time to locate and submit documents.
Coverage options for removed dependents – Employees frequently feel responsible to find new coverage for dependents removed as a result of ineligibility. The best employers either provide resources for employees to find new coverage for dependents removed, or they partner with a Dependent Audit vendor that does. DSI provides client employees with access to a private exchange, healthcare.gov, and a network of live independent agents by state who can help triage dependents into the right level of coverage.
Clear, honest and concise communication – Employees deserve to know why they are being asked to verify dependents. It is perfectly acceptable to tell them that dependent verification is to improve compliance and remove waste from the benefits plans. The longer the letter, email or payroll stuffer, the less likely it is to be read in detail by an employee. Employees are busy, so make it easy for them and keep messaging short, to the point, and at no higher than an 8th grade reading level.
Appeals Process – Employees deserve an appeals process for extenuating circumstances that inhibit their ability to provide necessary documents by the deadline. It doesn’t take much additional effort to grant an extra 2-4 weeks for an employee to secure the necessary documents. Tip: a grace period can negate the need for a 2 week extension.
Voluntary Removal – Voluntary removal of ineligible dependents is a brave thing for some employees who feel “caught” by a dependent audit. History and experience shows that employee morale is not impacted by a voluntary removal when the employee has amnesty, or “no questions asked” regarding the removal.
Document Resources – Employees should be given the contact information of the right resources to procure missing documents. INS, IRS, and Vitalchek are staples that should be provided to employees, but employers may also consider contact information on the local county registrars depending on employee residential density in a county.
Ease of Adherence – Document submission cannot be a one-size-fits-all approach to employees. Employees deserve the right to submit documents in the method that best suits them. US Mail, Web Upload, Email, Fax or Mobile Phone submissions provide sufficient variety of methods to meet most every employee’s needs.
Spanish Language – Over 55 Million residents of the USA identify as Hispanic. (2014 Pew Research). If an employer provides bilingual open enrollment materials it should be a natural extension to provide dependent verification tools, letters and website in Spanish as well. A double standard can result in adverse selection of respondents and dependents removed.
Equal Treatment – There is a misnomer among some companies that executives or certain pockets of employees may be exempted from participation in a Dependent Verification requirement. Not only does this open the door to adverse selection and discrimination, but Employees at all levels deserve to know that every employee, from the top of the c-suite to the newest employee is being treated equally in the effort to be compliant with ERISA and reduce overall waste in the health plan.
Strong Follow-up – When the health insurance coverage of an employee’s family is at stake, those employees deserve a mighty effort by the vendor (or employer) to reach the employee and ensure clear understanding of the penalty for non-compliance. This may mean mailing letters multiple times due to address changes, sending additional emails, or placing outbound phone calls to employees. The best dependent audit vendors do these things.
Dependent Verification projects have the potential to be disruptive to employees, HR, and organizational morale. Embracing a spirit of “What do our employees deserve in this process?” will improve employee compliance with a project, reduce business disruption, and boost overall Return on Investment.