Elevate Research Findings: AI and Modernization Trends

Working with Datos Insights, Elevate surveyed 150 HR and employee benefits professionals across companies of all sizes and representing a variety of industries.

What did we find? We’ll cut to the chase: Although the workforce is ready for AI-enhanced benefits account solutions, there is still a lot of untapped opportunity.

Taking the temperature of the industry

First of all, people making the decisions about benefits don’t usually use technology for technology’s sake. Instead, they prefer to use established, solution-based technology with proven value in the market. As a result, these groups may wait to use AI until it’s more established in the market­—even though that timeline is accelerating.

For example: AI adoption is a major focus for employers, with 54% of organizations either using AI or planning to implement it soon, which shows a strong shift toward AI in benefits administration. There's particularly high interest in AI-compliant solutions, as 85% of companies are using or plan to use HIPAA-compliant AI in their benefits accounts.

Employees are ready for AI, with 86% either embracing it or wanting modern, user-friendly solutions, suggesting a workforce largely open to AI-enhanced benefits accounts. The most desired AI applications involve improving employee experiences, with 45% of organizations wanting AI-powered chatbots and 32% seeking personalized coaching and faster claims reviews.

However, some caution remains, as 49% of respondents are interested in AI's benefits but still need evidence of successful use cases.

Time for change‍

While some caution remains, it will not remain for long. Employers express frustration with existing solutions, and 89% express a likelihood to replace older solutions with technology-centric vendors, indicating a clear opportunity in the market for organizations that can match these trends.

"The adoption of benefits technology, such as AI, has lagged behind consumer technology. But with the rising healthcare costs for both employees and employers, there is renewed interest in digital transformation that can deliver results. Nearly 9 out of 10 companies expect to replace existing systems with advanced technologies. This is where AI can play a significant role, delivering impactful use cases that help benefits administrators do more with less, while containing costs and improving the experience and usage rates of employees." - Brian Cosgray, CEO and co-founder, Elevate

Finding opportunities

The survey responses suggest that AI will become a standard for employers. As a result, businesses that provide benefits accounts should start integrating AI, machine learning, automation, and other advanced technologies into their solutions. By doing this, they can meet the changing needs of employers and benefits administration.

The future of benefits administration is tech-driven, and providers who embrace this trend will be better positioned for success. Take into consideration:

According to our respondents, 54% already use AI or plan to in the next 18-24 months, with an additional 40% open to using it in the future. Meanwhile, 43% already expect their vendors to maintain AI capabilities for faster, more accurate, and more secure benefits accounts solutions. The survey showed 49% of employers are hesitant about AI—but want to adopt once use cases and risk reassurances are in place.

The survey results show that AI-powered benefits account experiences require proper security, privacy, and compliance metrics to meet what employers need. The best AI solutions build in end-to-end at-rest and in-transit data encryption, application security, secure application infrastructure, and security protocols.

Employer and employee needs

The study offered insight into both employee and employer needs. Employers reflected on they most want AI to deliver for their employees, and it primarily focused on the user experience—including more intuitive screens, help with decision-making, and improved claims processing. They also would appreciate instant answers and a more informative chatbot, and they believe AI could improve processes like claim substantiation and HSA contributions. Overall, employers are looking to AI to simplify their employees' benefits experience.

“The CIP for HSA accounts is BEYOND frustrating for our itinerant workforce. There has to be a way to leverage AI for the better.” - Survey Respondent

“AI can analyze individual employee data to provide personalized recommendations for benefits plans, retirement contributions, and investment options, helping employees make informed decisions based on their unique circumstances.” - Survey Respondent

As for employers, there is a generally positive outlook on AI's potential in benefits account solutions, with many seeing it as a way to improve security, user experience, and compliance. Respondents emphasized the importance of user-friendliness, careful implementation, and cost-effectiveness, indicating that AI needs to live up to its hype. While a few remain cautious, most are open to AI's possibilities, suggesting a promising future for AI-driven solutions in benefits administration.

In short, employers are demanding modern benefits account solutions that bridge the technology gap with other industries. They want to see improvements to the areas causing the most significant pain points, including outdated portals, confusing documentation processes, and limited reporting capabilities.

Top asked-for improvements include better employee interfaces, faster reimbursements, instant claims reviews, and AI-driven administrative features. Integration with core benefits platforms and reliable customer service with self-service options are also highly valued. Ultimately, a positive overall user experience for both employers and employees is the most important factor in choosing a benefits accounts solution.

Full report

This is just scratching the surface of the research—all of the details are available to you in the full research report:

• How HR decisionmakers view their current technology solutions
• How AI is impacting the outlook
• Which modernization trends are most favorable
• Greatest opportunities for TPAs to advance their technology offerings

Download the full research report: Modernization Trends within Benefits Account Administration.