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PAPERWORK FRUSTRATES BENEFIT MANAGERS: SURVEY

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Benefit managers at midsize companies are dissatisfied with their current benefit enrollment and administration methods and are ready to consider new approaches, according to a new study.

A summary of he study was released early this month by Benefits Access Inc., a Hartford, Conn.-based unit of CIGNA Corp. providing integrated benefits counseling and administration services to companies with 1,000 to 10,000 employees.

A majority of benefits managers particularly criticized the prevalence of paperwork in the benefit enrollment process, according to the study.

"It's frustrating to administer benefits, and the (enrollment) process is very confusing to employees," said Sue Flores, employee benefits manager at Chandler, Ariz.-based Microchip Technology Inc., which employs 1,200.

The survey of more than 900 midsize companies was conducted by New York research firm Guideline Research before last year's fall enrollment season. It was done when Benefits Access started operations to assess the needs of its target market, said Rick Swaye, Benefits Access president.

While more than half of the employers surveyed believed they had quality and cost-effective benefits administration, 88% wished that it involved less paperwork. And 74% said they wanted to give employees faster and easier access to their benefits administration, according to the study.

But 91% of midsize companies still rely on paper enrollment, the survey found. Only 18% used phone or voice-response systems. And only 14% used personal computers at the worksite for enrollment, with 6% offering plan enrollment via intranet and 4% via Internet, the study found.

Employers using phone systems for enrollment were the most satisfied. While 45% of them said they were satisfied, only 16% of companies using paper enrollment, Internet and intranet said so. Of the companies using personal computers for enrollment, 33% were satisfied, the study found.

Following recent trends, phone and computer enrollment -- particularly Internet-based systems -- will continue to grow rapidly, Mr. Swaye said. "This is happening much faster than I and many anticipated," he said.

Benefit managers at midsize companies confirmed that there was dissatisfaction with existing administrative methods and said they were looking into technology to make the process easier for themselves and their employees.

Buffalo, N.Y.-based specialty foods processor Rich Products Corp., which employs about 5,000, is establishing an intranet it wants to use in administering its cafeteria benefits plan, said Gord Cumming, director of benefits.

"We are looking next year to allow employees to elect their benefits electronically" and look up information on offered benefits, he said. "People often get intimidated when they get a huge paper package of information," he explained.

But the intranet would be only a first step in changing benefits administration, Mr. Cumming said. "The disadvantage of the intranet is that you can only access it at work. But a lot of the benefits decisions involve the family," he said. Therefore, a possible next step would be to utilize a touch-tone phone system, just like the one Rich already uses for the administration of its 401(k) plans, Mr. Cumming said.

The phone solution was too costly for Microchip Technology, said Ms. Flores. While the company still uses paper enrollment, Ms. Flores keeps exploring new technologies. "It would surprise me if we didn't have an electronic system in one or two years," she said. Employees working weekend shifts, when human resources people are out of the office, could then still access all benefit information, Ms. Flores said. And "we wouldn't have to constantly send out and stock paper."

A press release and summary of the study can be obtained from Shari Wrisley at Benefits Access Inc., 860-534-7288. She also can put you in touch with a Benefits Access employee for further discussion of the study, if necessary.