S7 E7: Why Employees Ignore Their Benefits and How HR Can Help

Podcast August 18, 2026

Transcript:

Pete Wright:
Welcome to Human Solutions, simplifying HR for people who love HR. I’m Pete Wright. Here’s an uncomfortable truth about your benefits package: it doesn’t matter how good it is if nobody understands it. Companies put real money into health plans, wellness programs, and telehealth options, and then watch employees skip past all of it because the explanation arrived as a 40-page PDF written in insurance speak, sent once a year at the exact moment when everybody is probably too busy to read it.

So today, Mary McNally is back from AIM HR Solutions to join me to talk about closing the gap between the benefits you offer and the benefits your people actually use. Plain language, real cost examples, and how to reach a workforce that spans four generations without burying them, or yourself, in email.

Hi Mary, welcome back. It’s been officially too long.

Mary McNally:
Yes, I agree. Thanks for having me.

Pete Wright:
Well, I’m so glad to have you here. I want to start with a confession that I don’t know that HR people like to make out loud. Companies spend a fortune on benefits that employees don’t touch. How big is this problem really? What do you see when you look at actual usage reports across the scope of programs?

Mary McNally:
There are definitely top-tier benefits that people do utilize. A big one is health insurance, and then there’s dental insurance and disability insurance. So they’re being utilized, and you would see high utilization, but not necessarily an understanding of them. What I see is that a lot of questions are generated and a lot of confusion.

Pete Wright:
Okay. If we’re trying to split responsibility here, is it an employee problem or an employer challenge? The instinct, I think, is to say we sent the email. If they didn’t read it, there’s nothing else we can do. I’ve said that before myself. I have sent the email. If the team didn’t read it, I don’t know what else to do. I suspect you’re going to tell me that might not be good enough.

Mary McNally:
It’s both. The company is, like you said, spending the money on the benefits and they want them to be utilized. Ultimately, is it up to the employee to understand those benefits and to ask questions if they don’t? Yes. But I believe a lot of the onus is on the employer, because they are confusing. It’s a benefit that they’re offering their employees, and they should really try to deliver it to employees in a way that they understand.

Pete Wright:
Okay, so maybe you can walk me around some of the dark, sharp corners, the areas in benefits that you find are the most challenging to communicate, let alone to understand from an HR perspective. The terminology, navigating systems. Where are the specific challenges you find you’re helping employers improve their processes for employees?

Mary McNally:
One is volume. There’s so much information about each benefit that it can be overwhelming. That’s one piece. The second piece is, as you mentioned, the terminology, especially when it comes to healthcare. There are just so many acronyms and medical terms: copayments, deductibles, coinsurance. A lot of that can be very confusing for employees.

And then the third piece is interest. A lot of times people don’t necessarily find benefits that interesting. I always say that people find them interesting, or are interested in them, once they need them or once they change. Other than that, I don’t think it’s at the top of the list for employees’ interest.

Pete Wright:
Do you have a secret favorite benefit that you’ve seen cross your desk that a company has offered the teams that they weren’t using? That back-page benefit that people just didn’t understand, or didn’t even figure out was offered to them. What’s your favorite benefit?

Mary McNally:
My favorite, but that’s not being utilized?

Pete Wright:
Yeah.

Mary McNally:
That’s a good question. I would say disability is one. Again, people only utilize it if they need it. But I think it is not necessarily underutilized, so much as it should be understood more, to give people a sense of financial security.

Pete Wright:
Yeah. I expected you to say something more like rogue ping-pong. I guess we’re beyond the era of benefits inflation of a decade and a half ago. Yours is a much more rational answer than I expected.

Mary McNally:
Well, usually it’s those fun ones that are utilized, like pet insurance.

Pete Wright:
Right. They see those first. You have to get past the ping-pong to get to the disability.

Mary McNally:
Exactly.

Pete Wright:
Can you talk a little bit about the challenges of navigating a multi-generational workforce? I kind of teased that in our intro today, but I’m curious how you see the impact of communication, and the tools of communication, affecting different generations across the workforce that HR is dealing with.

Mary McNally:
Absolutely. Most of the time, unless you’re a very small company, and even then, you are going to have multi-generational employees. So it’s really taking a step back and thinking, what is the way that these types of generations tend to absorb data and have an interest in data?

The standard now is that everything’s about technology. All the generations are going to utilize technology. They have to, to live their daily lives and also to do their work. But what type of technology do they use? How do they want to use that technology? Reading versus listening?

So it’s taking that into account. If you have Gen Z and you have millennials, they’re accustomed to social media. Social media is small little bites of information. It’s mostly videos, it’s mostly sound. Whereas maybe other generations, like Gen X and baby boomers, may know how to utilize social media, but it’s not a priority for them. So maybe something for them would be more like short little emails, or having someone available to answer a question if they want to pick up the phone and give a call or send an email.

Pete Wright:
When we talk about the language that we’re using to help the communication land, so much information around benefits seems like it’s written by lawyers for lawyers. So when we talk about converting this to plain language, what does that actually look like when the underlying material is genuinely complicated?

Mary McNally:
That can definitely be a challenge for HR departments, especially people that specialize in benefits, because they’re accustomed to talking that language.

Pete Wright:
Yeah.

Mary McNally:
What I have found in the past, before AI came up, is really trying to extract the most important information from that benefit. Just a summary of what it covers, what the cost is, and how it’s going to affect them personally, and putting that in layperson’s terms.

Now with AI, it’s much easier. I would suggest that employers can use AI to input some legal documentation, like a summary plan description, and ask AI to narrow it down and put it into language for an employee audience.

Pete Wright:
I’m going to need a sidebar. May it please the court. Because you’re offering one option for HR professionals to help draft language that is a little bit more plain for employees. To what extent are you seeing employers just upload all the plan documents into an AI agent and offer the agent to their employees? You have questions? Ask the bot. Ask the AI insurance bot. Ask the benefits bot. The Benny Bot. If nobody has coined Benny Bot, we’re in trouble.

Mary McNally:
I like that.

Pete Wright:
What’s your experience so far?

Mary McNally:
In the benefits world, I have not seen that come to be more of a mainstream program for employers yet, but I do see that it could become more popular. Just like if you want to purchase something online and you have questions about it, the AI assistant is the one that’s going to—

Pete Wright:
Everybody’s got a bot.

Mary McNally:
Exactly. So it’s definitely doable. I do think, though, that behind all of that there does need to be a human who is very well versed in the different benefits. I definitely think that that’s important.

Pete Wright:
Do you have a mental checklist when you’re working with clients and you’re working on packaging employee-facing communication? Do you have a checklist that you walk through about what you do to create the documentation for these employees? We’re going to talk about formats, we’re going to talk about channels, we’re going to talk about plain language. Can you walk through a checklist?

Mary McNally:
Sure. The first piece of the checklist is really understanding the demographics of the company. As a consultant, I would want to look at that, but also as an internal HR person, you want to understand your employee population. So that would be one piece.

The second piece would be making sure that you have the appropriate documentation that describes all the benefits. Sometimes I see clients not necessarily have all the documentation that they need to support the communications for the benefit. So making sure you have all that.

And then the other piece is a checklist of what platforms you have available. Of course, email, that’s a big one. But do you have an intranet? Do you have an app? Do you use SharePoint for your intranet? So just the checklist of, what medium am I going to use to communicate these benefits?

The next piece would be what we were just talking about: how do you convert that legalese from these documents into terms that can be more understandable?

And then the strategy. It’s not going to be a single-prong strategy. It may be emails, and then you’re going to do a short video, and then you’re going to post something on your intranet. So, a communication strategy. Also kind of like my name.

Pete Wright:
How detailed do you find you need to get to make these experiences land? I know one of the things that you wanted to talk about in this conversation was a specific scenario. How often are you doing scenario presentations in this initial employee documentation, to make it sort of tangible, I guess?

Mary McNally:
Exactly. So when you get down to how you’re going to communicate and what you’re going to communicate, say for instance during open enrollment, that tends to be a lot of companies I’ve seen. They just send out all this information. All right, you have two weeks, you get to choose all your benefits. Here are links, or attached are all the documents. If you have any questions, let us know.

Pete Wright:
That’s a nightmare, right?

Mary McNally:
Exactly.

Pete Wright:
We all agree. That’s a nightmare.

Mary McNally:
And employees, they’re not going to read it. I wouldn’t want to read it either, even though I’m the benefits person sending it out, and I love benefits. But most people don’t.

Pete Wright:
Right.

Mary McNally:
So a big piece of that is figuring out how this is going to affect the actual person. We go back to generational. There may be a generation of employees that are looking to start a family. There are a generation of employees that are looking to retire. There are a generation of employees that have young kids, older kids, kids going to college. So it’s really trying to figure out what scenarios you can put together as examples to meet all those different phases that employees are in.

Pete Wright:
One of the things I know you talk about is communicating year-round, and I specifically want to talk about the two weeks of open enrollment. Because the idea of communicating year-round, not just during open enrollment, sounds awesome and exhausting. So I wonder if you could share with us the most realistic and optimistic cadence for an HR team of a couple of people trying to get the word out and keep people informed.

Mary McNally:
It does not have to be anything major. A big piece is, like we said, frequency. I’ve worked with clients where they do benefits newsletters, and those are sent out every couple of weeks. You don’t have to do a benefits newsletter. If you have the capacity, great. But it can just be little emails. A lot of times these benefit vendors will send information to the HR folks. Sometimes it’s just forwarding that. Or it could be doing a 20-second video from the HR person saying, good morning, did you know that X, Y, and Z benefit does A, B, and C? So just these quick little hits that you can do throughout the year definitely make a difference.

Pete Wright:
I love that. The next thing I was going to mention is the “did you know,” and you immediately went to “did you know.” The “did you know” communication is extremely powerful. The other one that I found I was very affected by when I was a young employee is the “what if.” I would get these “what if” posters all over the place. What if you were injured on the job? What if you got sick for longer than you had PTO for? What if. And they present an actual short scenario in a couple of sentences, and then there’s a plan for that. We can take care of that. You already have access to that. I found those kinds of communications really provocative. They got me thinking about things I never imagined I would have to deal with.

Mary McNally:
Exactly. And that’s where, like I said, the examples come in.

Pete Wright:
Where do managers fit in? Line managers, team managers, where do they fit in? Because I can see this argument both ways. They’re the closest touch point to the employee, and also maybe the last people who should be interpreting the summary of benefits coverage.

Mary McNally:
Well, that’s not what they’re hired for. They have a completely different skill set. But the main thing is they need to know the resources that the company has. So if the employee comes to them, they need to know, okay, contact this person, or you can read this information that’s found on the intranet. As long as they’re aware of the resources, then I think that’s their main responsibility when it comes to benefits.

Pete Wright:
Okay. There’s a budget reality check from the perspective of onboarding and ongoing operations. Not everybody has a benefits communication budget, and we’ve talked about a number of options in existing channels. Ideas for your best free or nearly free move, the thing that a company could do next week to help improve communication?

Mary McNally:
I think doing those small email blasts, whether it’s a video attached or, like you said, a “what if” scenario. Those do not take much time. Again, AI can help you write those if you know how to prompt AI. That could take five minutes, and it’s just sending it out. Most likely the main form of communication that runs across all generations and that doesn’t cost anything tends to be email. So that’s what I would do. I would start off with just these little small emails throughout the year.

Pete Wright:
Okay. Strategies from your perspective for keeping required legal notices and general education communications distinct from one another?

Mary McNally:
That’s a great question. Benefits are governed under this law called ERISA, and part of ERISA says companies are required to disclose certain communications regarding certain benefits. And that’s what I think a piece of open enrollment is good for. During that open enrollment time, utilizing that time to say, hey, here are all the plan documents, here’s the link to them, or if there’s no intranet, here they are attached.

Utilize one piece of communication within open enrollment. It’s not the only one, but utilize one piece of it as the compliance piece. Because that pretty much satisfies most of that communication disclosure, as long as you’re disclosing it at least once a year. Sometimes you only have to disclose it once every five years if there’s a change. But I advise clients to just do it once a year.

Pete Wright:
So that speaks to your responsibility as an HR team to keep some sort of documentation that you are communicating benefits, the required communications, on schedule, regularly, to everybody who needs to hear it.

Mary McNally:
Absolutely.

Pete Wright:
Who usually gets to do that? Benefits coordinator, HR managers, line managers?

Mary McNally:
It depends on how big the company is, but it definitely should be somebody in human resources. Ideally it is someone that specializes in benefits, but a lot of companies have just one HR person. So the responsibility is on somebody in HR to do that.

Pete Wright:
Okay. Open enrollment with planned changes seems to be the alpha-level problem, the hardest version of this communications challenge that we’re dealing with.

Mary McNally:
Yes.

Pete Wright:
How do you communicate change without triggering the panic-delete reflex? The “oh my god, I don’t know what to do, delete, delete, delete.”

Mary McNally:
Exactly. I’m frozen. I’m not going to do anything at all. Again, leading up to open enrollment, and even throughout these annual communications I talk about, if you know a change is coming down the road, start communicating that sooner rather than later. It may generate a lot of questions initially, but it’s worth it compared to getting all of these inquiries within a two-week period. At least you’re getting them throughout the year.

Another piece that I should have mentioned with open enrollment, or changing benefits actually, is that it’s a great idea to do focus groups.

Pete Wright:
Okay.

Mary McNally:
If a company is thinking of changing their benefits, you’re going to know that at least six months ahead of time, if not a year ahead of time, whether you’re thinking of changing some type of major benefit. So it’s doing focus groups.

People think of benefit focus groups as employees just asking for things that they’re not necessarily covered for. Oh, I want more PTO, or I don’t want to have to pay for my insurance. But these focus groups can be more delivered around, how can we make you understand the benefits more? What can we do as a company to help you understand that? How do you utilize the benefits? So it’s all in how these focus groups, the questions, are phrased. But if a company has the bandwidth, if the HR department has the bandwidth, I think those are a great way to start generating interest in the benefits, without a doubt.

Pete Wright:
This gets to what I wonder is one of the harder questions that HR teams, and benefits teams in particular, face right now, which is that we live in an era in which everything is getting much more expensive, not just a little bit more expensive. And the choices that we have to make on the benefits team for the company are putting more constraint on the team members that are covered by it.

When you are faced with someone who says, I was brought here with a promise that I would get this kind of coverage, and I feel like you’re letting me down, I feel like you are not meeting your end of the bargain, how do you respond to that? Can you give some benefits folks some ideas on how to handle those tough conversations?

Mary McNally:
That’s a great question. I think a big piece is really showing them the costs of the benefit itself. So going back to a “what if” scenario. I’m using health insurance because that’s one of the largest benefits, and it is cost-saving for employees but expensive for employers.

This “what if” scenario would be, okay, what if you had to go to the emergency room and you found out you needed to have surgery for X, Y, and Z? If you didn’t have insurance, or if you didn’t have insurance that was as comprehensive as the insurance here, it could possibly cost you X. But with our insurance, after you pay a copay or deductible, it’s still going to be less than what you would pay if you didn’t have the insurance, or if you had a less comprehensive plan. So a lot of times it really comes down to cost, and giving them that example.

Pete Wright:
I appreciate that, and I think just the act of doing it, of presenting that this is not a frivolous choice that we’re making, this is not a profiteering choice. It’s easy for us, your gut says, oh, it’s going to cost me more now, somebody must be making a profit and it’s not me. So who is it? That kind of a thing. When you are able to be transparent, you are able to offer the scenario that it’s painful for everybody right now. We are in it together and we’re trying to make the best decisions we can for everyone.

Mary McNally:
Exactly. You literally read my mind. I was going to say, be transparent about the costs, because the employer obviously has a large cost too. So it’s not something that employers are trying to hide. It’s just communicating it. And I think sometimes not all companies think that’s something that’s important, that employees want to hear. I think it’s the opposite.

Pete Wright:
Yeah, I think so too. So let’s go through a specific scenario you’d actually shared that you wanted to talk about. An employee receives a bill for a test that they believed was covered, or performed in network. No problem. And then a bill shows up. So walk me through it. What should have happened before the bill? What should happen after?

Mary McNally:
I think, especially for any procedure, a doctor’s visit is different, a doctor’s visit is what it is. But if somebody knows they’re going to be having surgery, or they’re seeing some type of specialist, or they’re having an outpatient procedure, I always recommend that they contact either someone within HR, a benefits expert within HR, or they can contact the health insurance company themselves and talk through the scenario.

A lot of times I’ve seen that employees think, oh, my doctor’s office, they must have called and thought that this was all covered, so I’m all set. That’s not the case. The doctor’s office will contact the insurer to make sure that you’re insured, but they’re not going to break down the cost of, here’s what your copayment is, here’s what your deductible is. So I definitely recommend that employees get that pre-information first from the healthcare provider.

Pete Wright:
Yeah, that I think is super important. And I think the challenge is to remember that there is a gap between what the insurance company is able to speak in their language and what the employee understands natively.

Mary McNally:
Yeah.

Pete Wright:
Those are different things. And so often the conversation is tied up in codes and language that the employee doesn’t understand.

Mary McNally:
Absolutely.

Pete Wright:
So your role in many respects is to be the intermediary?

Mary McNally:
Absolutely. In an ideal world, if somebody calls HR and says, I’m having surgery and I just want to make sure, what are my out-of-pocket costs going to be, that person would actually contact the healthcare provider or the insurance company together with the employee and be on the call for that.

I do find now, maybe not so much in the past, that a lot of these member services folks in the insurance companies are accustomed to knowing the audience that they’re speaking to. So they don’t always necessarily talk in all of this health insurance jargon.

Pete Wright:
Right.

Mary McNally:
So I do find that they tend to be very helpful from that standpoint. Whereas sometimes the doctor’s office, not that they’re not helpful, but that’s all they’re doing all day long, is talking about ICD codes and all these acronyms.

Pete Wright:
If for no other reason than to demonstrate that we’re all in this together, this is a great conversation, Mary. Thank you so much for your time. Anything we’ve missed today that you feel like you want to make sure we absolutely get in under the wire as we wrap up?

Mary McNally:
I think a big one is consistency. Trying to see where your employees are coming from, and just being consistent in communicating those benefits and being available to answer the questions.

Pete Wright:
For sure. And speaking of being available to answer questions, the AIM team is just rich with experience in exactly this area. If you have any further questions and you need help with your benefits communication, please reach out to the HR helpline. AIM members can reach the helpline at 800-470-6277 or helpline@aimnet.org. Again, that’s 800-470-6277 or helpline@aimnet.org, for inquiries Monday through Friday from 8:30 to 5:00 p.m. Eastern Time. Email requests are responded to within 24 hours.

I love talking benefits. And next month, at the Lunch and Learn, we are going to have the world-famous Terry Cook and Tom Jones. I should say world-podcast-famous Terry Cook and Tom Jones, back. And we’re going to be talking about PFML. PFML Mythbusters, they’re calling it. We’re talking about common gray areas and risks for HR, including performance concerns, workplace changes, and retaliation. And that will be September 8th, at this time in this place. So watch your email for communication about this event next month.

On behalf of Mary McNally, Mary, thank you so much for being here. Such a treat.

Mary McNally:
Oh, thank you. Thank you as well.

Pete Wright:
Thank you, everybody, for listening to the show. We hope you subscribe to the podcast version. You’ll get the replays of the recorded episodes just a week later. Next week, on this very day, Tuesday next week, you will get the replay in the podcast feed. And there’s the whole library of past episodes that you can listen to in the podcast feed of Human Solutions, anywhere you get your podcasts. On behalf of Mary McNally, I’m Pete Wright. Thank you for joining us, and we’ll see you next time right here on Human Solutions.