Human resource professionals are presented with strategic initiatives each year. This year the focus has shifted to the critical tasks of maintaining business continuity, managing a virtual workforce while maintaining employee well-being, and complying with new leave and benefit legislation. While these tasks are of critical importance, it is still vital to maintain the focus on underlying benefit administration issues that have not subsided.
Many companies are concerned about their benefits administration provider based on service delivery quality or overall cost. However, some organizations are not ready to undergo a provider selection or change even though contract end dates are fast approaching. If a provider change is not possible, focusing on a short-term contract extension might be an appropriate strategy. This approach can result in securing commitments to enhance service delivery, reduce costs, and provide stability. Providers are generally willing to enhance the current service arrangement, with the hope that they can retain the business long-term.
There are many ways to impact benefit administration provider arrangements in the short-term including:
Negotiating lower fees for unexpected high volume-based activities (e.g., 401(k) loan fees, COBRA/direct billing) or headcount reductions. It may also be possible to negotiate the short-term extension fees to fall within current market norms. Benefit administration providers want to retain business beyond the short-term extension period and may be willing to be creative with pricing.
Existing contracts may not contain terms that address contemporary requirements such as cybersecurity, offshoring, termination, and higher limits of liability. These are requirements that benefit administration providers must include in new contracts and are generally willing to add to a contract extension.
Quality service delivery is critical, especially during these times. Performance Guarantees can be reviewed and enhanced. However, Curcio Webb has found greater success helping our clients and their providers define projects that will lead to better delivery results. Examples include enhancing customer service knowledgebase information and retraining where needed, implementing better controls and reconciliation processes, and improving the overall level of automation.
There may be tools, technology, features, or functions that are available at your current provider but have not yet been introduced to your Benefits team. Some of these will improve delivery and the relationship value and can often be added at no additional fees.
Curcio Webb has over twenty-five years of deep knowledge and experience in guiding our clients through short-term contract extensions while considering longer-term goals.
Our team of experts are available to discuss your strategy and help you achieve desired outcomes. Please contact me if you wish to schedule time to discuss your contracting options.