March 06, 2000 align=justify>Wouldn't it be nice to have someone in HR who was able to keep up with all the latest news about benefits and compensation, as well as all the legal issues involved with those topics? With just one phone call to that special HR professional, employees could have their every question answered, your company wouldn't have to worry about legal problems arising, and you could go home without having that nasty headache that seems to continually plague you.

Well, it's not feasible to expect one person in your firm to be an expert on all the issues. There aren't even two people who could carry that load. Face it, you would need a whole team of experts to keep you well-versed on all those topics. Perhaps your organization is large enough to support such a team, but even then, you would still have to find people who have the time to research where to find the best companies to use and the most economical but comprehensive plans to consider.

There is an alternative, says Harriet Hankin, president of CGI Consulting Group, Inc., a benefits outsourcing company in Malvern, PA. "You can actually outsource your entire benefits department without spending more or without upsetting your employees," she asserts. "And in today's market, that really makes sense."

A full-service outsourcing company can provide your company with all the convenience of an expert benefits department:

• Designing the benefits
• Finding the appropriate carrier
• Deciding where your 401(k) investments should be
• Communicating and marketing the benefits to your employees
• Being available to answer employees' questions as well as helping them enroll in the benefits plan

It can also check on problems that your employees may be having and keep them up-to-date on new coverages that might be beneficial to them during different stages of their lives.

"Outsourcing allows a company to focus on its core competencies, instead of having so many of its employees having to deal with items that have nothing to do with that core competency," says Hankin. "You can have an expert in each field: someone who is just fabulous at on-site presentation, someone who excels at writing communications, someone who knows ERISA top to bottom, or someone who can find just the right company to handle your long-term disability needs."

"In addition, benefits is a very legal field, and the laws change constantly. If you have a good outsourcing company, it will absolutely keep you on top of what's new. The liability is also shifted to the outsourcing house. You are hiring experts who know how to file the 5,555 forms and take care of all your benefit needs. That's what they are doing for a living. If they make a mistake, it's on them, so you don't have to worry about someone coming in saying, 'I want $30,000 of life insurance,' and you haven't gotten waiver of premium or all the details of benefits."

It's for Almost Everyone

Outsourcing can be valuable for companies of any size, from 10 employees all the way up to tens of thousands. Not all companies may be ready or willing to explore this resource, however. "Companies that are based in one location may be content to have their benefits program on-site, because everyone has always felt comfortable going down the hall to see Mary about any of their questions, and it's okay if Mary doesn't know everything. These companies can contact specialists when they have extraordinary needs that come up only occasionally.

"Then there are those companies who have spent years building a fabulous staff, and they are unwilling to even look at any changes. Also for some companies, though not for most, outsourcing can at times cost more than what they are currently spending. We try to show them that this additional expense may in the long run save them money, but companies like this are usually content with what they have."

Don't Micromanage

Once you find an outsourcing company, it is important to let it do its job. Often, companies find it hard to change their ways. They keep a number of people on staff in the benefits department at the company, and they also try to micromanage the entire process. "When you hire a competent outsourcing company, you should be able to cut your staff down to one or one-and-a-half people," says Hankin, "and you should be able to trust the company to do the work.

Micromanaging is not good for anyone. Instead, just bask in the glory, because nowadays every department is having to justify that it is saving the company dollars and time, and if you have a good outsourcing company, that is exactly what you will be doing for your company."

Finding Good Help

So how do you find the right outsourcing experts for your company? Hankin suggests the following:

• Check any references very carefully. You want to know what their reputations are. It's easy to call yourself an expert, so ask them for references. If possible, look for someone who has been in the business for a long time and not someone who is relatively new.
• Take a tour of the facilities. Make sure that you see real live people doing the work and ask them how they do it. This is especially true of the customer service representatives.
• The company should have a toll-free number for your employees to call if they have any questions or concerns. At CGI, employees can call in to find out what benefits their employers offer, which ones are appropriate for them to use, and how they can make changes to their policies. The service representatives will talk the employee through any changes, enroll them in any policies they need, and also mail the employee a confirmation statement showing what has been changed or updated.
• Check the hours of the customer service line. Is it open in the evenings so your employees can call it when it is convenient? Is it available at all during weekends?
• Ask if the company offers a service which checks on benefits when employees are having difficulties receiving payment or filling out forms.
• Make sure the people at the outsourcing company are people you get along with. So much is personality driven, but remember they are your benefits department, and you want to make sure that you feel comfortable working with them.
• Ask them exactly what services they will provide for your company and how much it will cost. Outsourcing in general should cost an amount comparable to what you are currently spending. What they should be offering is more "bang for the buck."
• Find out what it will take to get out of the contract with them if you are unhappy with their services or if you decide to insource again. See if there are any hidden costs involved.