Insider Scoop on the Future of BenAdmin: From Data Integration to AI

Benefits Administration (BenAdmin) is changing at lightspeed—new tech, shifting employee expectations, and the drive for efficiency are all shaking things up.

We sat down with industry experts Matthew Kaiser and Aaron Kenny from Advisor Collective to get the inside scoop on what's next for BenAdmin. We'll cover emerging pain points, cool new tech, and predictions that could reshape the field in 2025 and beyond.

Buckle up for a forward-thinking take on where BenAdmin is going and how you can join the ride.

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Benefits Administration vs. Benefits Management: A Key Difference
Employee Empowerment: From Decision Support to Total Compensation Visibility
Benefits Administration: The Employer’s Perspective
Emerging Features and the Role of Machine Learning
The Integration Pain Point: The Need for Better Data Flow
Looking Ahead: Predictions for the Future of Benefits Administration

Benefits Administration vs. Benefits Management: A Key Difference

When it comes to understanding benefits, one common confusion is the distinction between Benefits Management and Benefits Administration.

"You can manage benefits on paper, but to actually administer benefits, you need technology to span across the employee base and provide a seamless experience," Aaron pointed out. Administration goes beyond managing options—it leverages technology to not only communicate those options but also optimize their use.

Matthew further explained, "There are times when simply managing benefits is sufficient—keeping everything static year after year. But in today’s competitive labor market, Benefits Administration needs to achieve two things: communicate the value of benefits provided by the employer and make it easy for employees to use them whenever they need." He emphasized that the role of Benefits Administration is to add value in real-time, beyond just enrollment periods.

In a nutshell: Benefits Management is reactive—it’s about maintenance, while Benefits Administration is proactive—it’s about maximizing value, both for employees and employers.

Employee Empowerment: From Decision Support to Total Compensation Visibility

Benefits Administration today is about helping employees be informed consumers of their healthcare benefits. Aaron pointed out, "Decision support tools have almost become table stakes. These tools help employees make sense of the many choices available to them and guide them to make informed decisions."

The importance of decision support isn’t limited to enrollment periods either. As Matthew noted, some benefits providers are innovating by integrating historical claims data, with employees’ permission, to offer predictive insights.

 "When employees see recommendations based on their past claims, around 70% opt in. That shows how much people want assistance to make good decisions." 

Empowering employees with this kind of personalized support is a game-changer—it transforms healthcare benefits into an ongoing, value-driven experience.

Another aspect of employee empowerment is the visibility of total compensation. Aaron explained, "The concept of total rewards means showing employees the full value of what they receive—not just salary, but also health, wellness, and financial benefits. It’s surprising how many employees don’t realize that their employer contributes tens of thousands of dollars on their behalf annually. Total compensation visibility allows employees to fully appreciate the entire package."

Employers that successfully communicate the value of their benefits programs often see increased employee engagement and satisfaction. If an employee knows that their employer is contributing $18,000 towards their healthcare, they're less likely to jump ship for a minor pay increase down the street.

Benefits Administration: The Employer’s Perspective

For employers, investing in benefits is mostly about attracting, retaining, and motivating employees. Matthew shared an example of a makeup manufacturer competing with Starbucks for talent. To differentiate themselves, they offered on-demand pay, which allowed employees to access their earnings when they needed them, rather than waiting for a paycheck.

Starbucks really reset the industry a long time ago when they said 'Hey, we’re going to give benefits to part-timers’.

From a financial perspective, benefits are also a major cost lever. Employers need to ensure they are optimizing their spend, and Benefits Administration helps by using data to align benefit offerings with employee needs. It’s about making sure that what’s being spent is actually valued by employees.

The Integration Pain Point: The Need for Better Data Flow

It’s safe to say that the integration of data between Benefits Administration systems and carriers could use some improvement. Managers are frustrated with outdated methods like Electronic Data Interchange (EDI) files. The ability to cleanly, reliably, and consistently communicate information from a BenAdmin platform to various carriers is a massive challenge. 

Solving the data integration issue could help make the experience seamless for both employers and employees. Without reliable data flow, even the best benefits solutions can fall short. The future will need a more modern approach—one that streamlines data sharing and enhances the 360-degree loop of information between all parties involved.

Emerging Features and the Role of Machine Learning

Machine Learning (ML) is transforming how benefits are offered, making them an ongoing, personalized process instead of just an annual choice.

Matthew pointed out how innovators are using historical claims data (with employee consent): "About 70% of employees, when they're asked, say yes—look at my old claims and use that to help me predict my future claims so that I can make good choices." 

This trend is all about using data to help employees make smarter decisions and helping employers tailor their benefits programs. Predictive analytics let employees choose benefits that actually fit their needs, considering things like health history and likely future use. This has two big benefits:

1. employees get better options
2. employers can anticipate what benefits will work best for their workforce 

Plus, companies can cut costs on underused benefits and put the money where it matters most.

Looking Ahead: Predictions for the Future of Benefits Administration

There's a lot to be excited about in the world of BenAdmin. Here’s what Matthew and Aaron predict:

• Better Data Flow & Integration: The clunky data integration days need to end. Aaron talked about the frustration with outdated methods like EDI. The future is about building smoother systems that make data transfer easy and reliable. To stay competitive, carriers and BenAdmin providers need to get this right.
• Smarter ML & AI Integration: ML and AI are moving beyond automation to predictive analysis, helping employers tailor benefits to employee needs. We're shifting from reactive enrollment to proactive, data-driven choices. Employers will need platforms that analyze trends, anticipate needs, and provide personalized recommendations—because one-size-fits-all benefits just don’t cut it anymore.
• Transparency & Trust: Employees want to know how their data is being used—and they want to see a real benefit from sharing it. We’ll see more clear, easy-to-understand consent processes, along with real-time insights that show the value of sharing data.

Driving the Future of Benefits Administration

The evolution of BenAdmin is all about anticipating future needs and solving existing pain points. Integration, personalization, and smarter technology are paving the way for a more effective benefits experience for both employers and employees.

Whether you're an employer, broker, or benefits professional, understanding these evolving trends in BenAdmin helps you stay ahead. As we gear up for 2024, it’s time to assess whether your current BenAdmin solutions are keeping up with these trends.

Are you leveraging AI to provide personalized decision support? Is your data flowing smoothly between payroll, benefits, and carriers? These are the questions you need to be asking.