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Why Most Benefits Programs Break the Moment They Meet Real Life · Beyond the Paycheck

• Kelsey Willock (00:42) Welcome Tom Ellis, VP of Total Rewards at Emplify Health. We're so excited to have you this Tuesday afternoon. To kick us off, I'd love for you to share a little bit about your career and background and where you're calling in from today. Tom Ellis (00:54) Happy to be here, Kelsey. So I started my career and I'll just ⁓ touch on the HR portion of that. For about the last 20 years, it's been primarily in healthcare. It's ranged from organizations of 10 or 12,000 employees all the way up to health systems with over 100,000 employees and various places in the US, Tennessee, Maine, Florida, and now here in Wisconsin. Kelsey Willock (01:20) Fabulous. Well, I'm really excited to ask you a whole lot of questions about all of those experiences and also focus on your current role. But before we get there, I want to get to know you a little bit better. So if you'll indulge me, I'd love to hear what was your earliest memory of money. Tom Ellis (01:36) Yeah, so when I think about my earliest memories around money and finances, it's probably that first job I had as a paperboy. So 10 years old, you 5 a.m., you hear that large sound of the stack of papers hit in the driveway, right? But that was the first opportunity that I had really to be paid for something I did, right? So value receiving, in this case, cash, I believe that are on. for delivering these newspapers to probably about 125 folks across our neighborhood. And felt very, very proud and helped a lot with my self-esteem at 10 years old to kind of have my own money and to be able to do with it what I wanted. So that was neat. Kelsey Willock (02:17) What was, mean, obviously, I think that that was pretty much your first job, unless there was another one you wanted to highlight. But I'm super curious if you want to talk about another first job, but particularly what you spent your first paycheck on. Tom Ellis (02:30) Yeah, so I, you know, I would say my first actual paycheck was when I was in high school. So I worked in a fast food place and, that first paycheck, like a lot of people, was like, taxes wasn't really familiar with those. Not a big fan. You know, I just assumed I was going to get paid, you know, my hourly rate times the number of hours I worked. And so, you know, got that first paycheck. And I think a lot of necessities. on that first paycheck, right? I had my own car, so I had gas. My parents were trying to get me to start paying my own insurance. And so a lot of essentials that my parents previously had paid for, now I was responsible for. So it was a different world order at that point. Kelsey Willock (03:14) Yeah, I certainly remember my first paycheck was not what I had originally done the math for. And so it's always a bit of a wake up call for people. How do you think your relationship with money has impacted how you show up in terms of pay and benefits on behalf of your people? Tom Ellis (03:23) sure. I think because I grew up not wealthy, my parents were pretty poor, that I have, and my parents were conservative in the aspect of they were savers and they did not take out a lot of loans. And so my frame of reference and everybody has their own was really around those types of things. Now, how that affects how I think about paying benefits, you as I think about plan design, I really have a heavy burden for our frontline employees. And I think about the kind of people who may be living paycheck to paycheck and who look at that paycheck, in our case, every two weeks and really dig in deep when they look at it to determine, OK, are there trade-offs, things we may need to put off buying this week or this paycheck until the next paycheck? And so I have a burden for folks that are living that kind of life because that's how I grew up. Kelsey Willock (04:27) How important is financial well-being to the company right now? Because you bring up a really good point, which is financial stress. And we're noticing this is a really growing problem, particularly in the United States when you think about inflation, and especially in the population that you're describing. So talk me through, how does the organization think about it? And obviously, you already mentioned, you deeply care. Tom Ellis (04:48) Yeah, you know, I think it's, to your point, more and more top of mind for many employers, including us. I will tell you that I've been at organizations where we actually extracted the identified data to look at things like how is our population really handling debt. let me tell you a quick story. So I had contacted a friend of mine at a very large pharmaceutical company. We were considering implementing student loan repayments. This was back in 2021, that timeframe. And as part of that consideration, we wanted to know, do we really have a problem other than what we were hearing through employee surveys and the like? And so he had mentioned they had gone through a similar exercise and they actually had the retirement program, which was Equifax, pull the data around loans and all that sort of stuff for their employee population. And they were able to tell from that that actually student loans were not largely being held by their employees. It was actually the parents and the grandparents and not the frontline employees. And so they made different decisions when they decided, you know, to go with a loan repayment. said, ⁓ before we do student loan repayment, we're going to try educating. And so they spent two years doing education. And as they started to see some of those student loans get paid down and then they realized there was a segment of their population that also had a lot of automobile loans. And so they had different forms of education and financial wellbeing that tied to how you get out of debt, stay out of debt, and how you look at different types of debt. I thought that was really unique. I learned from that. said, okay, before we run off and just design a plan for a problem we think we have, let's use the data to really understand what is the problem, and if so, what are the depths of the problem? Kelsey Willock (06:38) I love that because we can look at big headlines in the news. can hear that financial stress is this massive, pervasive problem that affects 70 % of people. But what, at the end of the day, matters most is how is it actually impacting your organization? You also bring up another really good point, which is this data doesn't often appear in oftentimes our surveys. A, money is highly taboo and people don't want to talk about it. Or maybe if they're talking about it, we're not really actually hitting what's really the root cause of the situation. So this is a highly tangible thing that our listeners can take back, dig deeper into the data, and think about alternative ways in which to gather it. Tom Ellis (07:17) Yeah, I think the data serves a couple of very important purposes. One is establish a baseline and understand what the problem is, right? And we talked a little bit about that. I think the second part of it is understanding and being able to measure the efficacy of the programmatic interventions you've made. So if you develop some design things around the health plan, for example, how do you know if they're effective? Well, you only know that if you have the data. There's a quote that everybody without data is just another person with an opinion. And we have a lot of that even in committees I've been on where we have great ideas, but we've not measured whether or not we're solving the right problem and or what the efficacy is again of the programmatic changes that we've made. And so that becomes really important. Kelsey Willock (08:05) have you employed certain practices that have allowed you to better and more effectively measure? Tom Ellis (08:11) Yeah, yeah, in fact, I was on a call today. One of the things I brought with me to various employers that I've worked for is this concept of really having a data warehouse. And I'll share two different pieces, one around pay and one that's really more related to benefits. we wanted to look at all of our population health, all aspects of population health. So workers compensation, know, certainly the health plan claims, the pharmacy plan claims. all of those sorts of things. And so you bring all of these data feeds into a central warehouse, you build an analytics tool or buy an analytics tool that sits on top of it, and then you either hire or buy a data scientist to help mine it. And in the process of doing that, you get to places where your intuition sometimes is refuted. You're like, I thought it was this, and this might be the problem, why our ED utilization is so high. But now that I have the data, I understand that's really not the problem. And we actually had an interesting case study in that very situation where we found out our avoidable ED utilization, which at this particular employer was probably about 30, $40 million, was actually, we thought it was because of convenience. We actually found out it was because we had educated people to do that. And that was, were just following what we had educated them to do. And without the data, again, we would not have known that. We would have made some assumptions. In previous years we had, we're like, we're going up on the copay in this case to try to change behavior so people do not use the ED when their GQR is a better option. And in the process of doing that, we found out, that wasn't actually the case. And that type of intervention would not have been successful in changing behavior. We really needed to reeducate our employee base. And so we spent time and effort doing that, which is doing other interventions that would not have been successful. On the pay side, I think getting good data, you know what? most of us that have done this work for any number of years, you we have access to good survey data and all that, right? And we typically do a pretty good job of collecting data from our employees, right, and asking them questions, even though they may not have the expertise to understand even what the question really means. So, for example, we had a survey data that came back, again, an employer I was at, that said employees were not really too interested in short-term disability. They certainly didn't want to pay for it. Right. And then COVID hit. Right. And when COVID came and we were having these discussions about you're going to be out of work and not be paid, I'm sure if we had re-surveyed them at that point in time, we would have gotten completely different answers. So I think there's an art and a science to pulling this data together, mining it in the right way, and then making sure you have the right understanding of what your employees wants and needs are before you develop a plan designer. Kelsey Willock (10:54) You know, it's really dissecting what are the leading and lagging indicators going on and how do you more effectively measure them pre and post introduction to certain interventions. So I think it's a really phenomenal example. It's also a really good segue into where you're seeing certain breakdowns happening today. You know, obviously you've done a lot of research on the data side. Where are you seeing the majority of breakdowns happening, whether it has to do with pay, compensation benefits or more? And you can answer their more question broadly if you'd like to, or you can also speak directly to the company. Tom Ellis (11:28) Yeah, let me start with kind of the broad response to that. I think we do a wonderful job of developing very elegant programs and they work wonderfully until they meet the messy middle and the messy lives of employees that employees are actually living. So again, you have a great program around retirement and you're like, ⁓ this is good. We're gonna have a good match. We will have an employer contribution and those things will work together to get people ready for retirement. And then somehow along the way, we lose the fact that, you know, folks may run into some problems and challenges that were unanticipated. They may stop contributing for very good reasons. Right. And so the programs are designed, you know, kind of for the average. And oftentimes they don't consider the unique needs or where an employee is within their life cycle. Right. So the needs that I have at the age I'm at, where I am in my career are going to be very different than the 25. And so how do we blend, you know, again, these programmatic interventions in a way that they address the needs of employees at each point of their life cycle, give them enough flexibility, still meet the compliance requirements in a regulatory environment, but also allow, you know, for affordability. And those are the tensions, right? Those are the tensions that are created. And so, you know, we find ways to do that, you know, I would say on the behavioral health side, which has been something that's been top of mind, I think for all total awards professionals in the last probably now five years, you know, since COVID. You know, I was at an employer where we decided to go to do a direct partnership with our local health system. And we had them do really three things. And this was actually modeled on a program that DuPont had rolled out years and years earlier. So part of the program was we wanted on-site until COVID hit and then it became virtual. but we wanted both virtual and on-site counseling, which is the biggest part of an EAP. And by the way, I think EAPs need to be completely redesigned. But so we did that. The second thing we did is we had a virtual version where folks could go in and they could do their own self-assessment. And if they were struggling with a certain behavioral health condition, they could opt out and speak to the right level of clinician to get. services that they may need. And then the third thing was we had a navigator program because again, some national programs weren't great up until the point that you need to figure out how to migrate somebody into, you that may have a more chronic condition into a situation locally where they have the right resources. And so we brought this navigator program up, which is where these were more senior level clinicians and they were connected locally in the local environments where we had employees. And so they were able to shepherd these employees. to various services that may be outside their expertise, but they knew, hey, somebody's moving and they've got to give their pets up. And for somebody that is struggling with behavioral health, that's a significant issue. And I know who to connect them with that can help them navigate that program. And so we learned a lot from that. And I'd like to say, you know, I was very intelligent about doing all this, but we stood this program up, not knowing COVID was coming, but when COVID hit, we were very glad we had it. And I still hear from the HR team there, and they will say, that was one of the greatest things we did for our employees, and we still will get great utilization out of it today. And you think of an HR business partner, and they now have a resource and a service. A line manager now has a resource and a service that they can refer people to as part of the program. And so that was a, I'm very proud of that. The team and I did a lot of work together to make that happen, and it's been very successful. Kelsey Willock (15:07) I'd love that you bring up the introduction of a highly successful program, but I want to dig a little bit deeper on what are the kind of outcomes beyond the conversation internally that you're seeking and also how do you communicate up channel ⁓ the success of a program like this? So the CFO, for instance, is like, this is a real win. What does that look like? Tom Ellis (15:26) Hmm. Yeah, let me use that last reference that I provided Kelsey, which is when we first implemented that program, our CEO at that time was an MD. So he was a doctor by trade and this was a pretty large ⁓ biotech firm. And his question to me was, look, you know, if we're just going to do talk therapy and we're going to spend all this money. we're going to need to see results. And if we don't, basically, the unspoken word there was, we're going to think about changing the program design or eliminating the program altogether. And I'm like, that's fair. If it's not effective, it's not working, we would consider doing that. And that through COVID, and we all remember and know how difficult it was, after we got our first year's worth of data, ⁓ we had eight suicidal ideations that were avoided because of this program. And so I remember the follow-up conversation with my CEO about that and sharing that data with him. And we didn't discuss again the efficacy of the program after that. Now that was the up, right? Reporting up. I also reported out to our executive leadership team, ELT, at that organization. And we would, again, we got good data. We compiled the data into... bite-sized pieces and in three to four slides, five slides, we were tell the story. will say HR as a function is typically not great at telling its own story for a variety of reasons. think having good communications people and experts that can help you frame how we're going to tell the story, both again, up to the people above us, to senior leadership in my case, as well as to the employees, hey, we're making these changes. This is the result of the change we made a year ago. This is step two out of three steps and being able to again confirm and clarify that in a way that is storytelling really resonates a long way. I would say on the employee side as well, being able to bring employees that were positively impacted by some of the changes you've made can be really, really powerful. So in a format like this, you know, maybe it's a three to five minutes and they talk about, hey, you know, if it weren't for this benefit, I might've had a different outcome, but because of this benefit we were able to achieve. And that's a powerful way for employees to see the value in what's being provided. Kelsey Willock (17:52) As such a data-driven person, I think it's a really important reminder that the qualitative still really matters, especially in storytelling. quantitative might be a reason you make a decision, but it might not be the only reason you keep and you sustain that decision. Tom Ellis (17:59) and out. Yeah, I agree. You know, from my perspective, it requires both. And you really want both. And I don't think to your point that that one is above the other, you need more than one the other. You need to take the data. And the data is only important because it tells you a story. Right. And the ability to take that and translate that story into things that matter. You know, we refer to moments that matter for employees, for executives. Right. We're all human at the end of the day. And so hearing a good story and a positive outcome on something that folks work hard to implement and maybe it was an innovative type of solution, really, really engaging and important. Kelsey Willock (18:45) What kind of benefits trends do you think are going to shape the employee experience most over the next year? We're in obviously a very interesting time right now. So it's hard to answer this question likely without AI being referenced, but curious your thoughts. Tom Ellis (18:58) Yeah, it's a great question. I think we're going to continue to see a push for more flexibility, right? So it was a few years back when you started to hear more about things like lifestyle spending accounts, right? People want flexibility and they also want inexpensive, right? And healthcare is a good example. You know, they want inexpensive, but they want to be able to make some of their own choices. And so again, what's the tension there? How do you provide a benefit that allows for reasonable choice? Right? And informed choice, because that's the other part. It's like, if you ask me, you know, to go out and pick the best computer monitor, I'm going to probably do some research and maybe I could figure it out, but it might be easier for me just to call an IT expert and have them tell me. So it's that balance between, without turning people into benefits and compensation experts, how do we make sure that they're informed? and they have some choice. And then I would say the third leg of that stool is what I could refer to as a pay for play strategy. So I think the days where the employer is basically in a position where they're responsible for taking care of every decision an employee makes around, for example, their health or what they do with their career is like those days are gone. And it's much more of we're going to provide the tool, support and education you need as an employee so you can be successful with your health journey. You can be successful with your career journey. You can be successful in your finances. We're to do all those things, but you as an employee have a role to play. And what is that role, right? And so with healthcare, it's like, we're going to give you a limited number of choices. As long as you make the right choices to get those pre-screenings done, as long as you make the right choices to go to the school, right? To take advantage of the tuition reimbursement, then you will have a positive outcome, right? But what we're not going to do is, say health insurance is free and your decisions don't really matter. And we hope it all works out for the best. it's that really, there's dual accountability. We're gonna co-create and co-design and then there's gonna be shared accountability at the end of it all. Kelsey Willock (21:02) I think I figured out which quote I'm going to use to highlight our conversation. So thank you so much, Tom, for joining us in this conversation. I certainly learned so much from you. Where can our listeners connect with you beyond this conversation? Tom Ellis (21:15) So the best way to connect with me is through LinkedIn. So I've got about ⁓ 11,000 followers on LinkedIn and while I don't interact with them all the time, I do hear from many of them regularly for various reasons. And so that's a good way. I will be launching a podcast here in the coming months. So look for that. And that's on my LinkedIn profile. It's called Me to Influence. It does not have anything to do with work. It's really primarily about people's personal journey. what they want, what they see as their life's calling, passion, whatever word you want to use, and then how their faith interplays and supports that. And so ⁓ that's another place we can connect and there'll be a website, we'll be standing out for all of that. But those are the two primary ways. Kelsey Willock (22:00) Fabulous. So for anyone listening in, I'll make sure to link in the post about this conversation a little bit about Tom's upcoming podcast, as well as additional resources. Thank you so much again, Tom, for joining us this Tuesday afternoon. Look forward to hopefully many conversations to come. Tom Ellis (22:19) Thank you, Kelsey. was great being with you.