Benefits adoption is one of the biggest challenges HR and People Ops teams face. It plays a key role in employee satisfaction, engagement, and overall well-being. It also directly impacts the return your company gets from the time and money invested in your benefits program.

Even with a thoughtful and comprehensive package, many employees still don’t fully understand what’s available to them. When plans are complex or communication is limited, it becomes harder for employees to take full advantage of their benefits.

For most companies, open enrollment is behind them and the plan year is already underway. Now is the time to shift from enrollment to engagement. In this post, we’ll share practical strategies to help HR leaders drive adoption, improve employee understanding, and make sure your benefits package delivers real value throughout the year.

Why increasing benefits adoption is important

If your HR team has spent time understanding employee needs and selecting the right benefit plans, that investment only delivers value when employees actually use those benefits. Adoption is what turns a thoughtful plan into real support.

Employees with poor mental health miss an average of 12 days of work each year due to unplanned absences, compared to about 2.5 days for those with good mental health. Gallup research suggests these absences add up to tens of billions of dollars in lost productivity across the U.S. workforce. And yet, many employees still don’t know what mental health resources their employer offers.

When employees engage with their benefits, everyone gains. People get regular care, use wellness programs, and receive financial support when they need it. As a result, they feel less stressed, more productive, and more satisfied at work.

Employers also benefit. Contributions to pre-tax accounts like HSAs, FSAs, and 401(k)s can reduce payroll tax costs. These accounts also help employees plan for future healthcare expenses, which often leads to earlier, preventive care. That can reduce the chance of costly claims later. When people delay treatment, the eventual care tends to be more expensive, which increases premiums for everyone.

Stronger engagement with benefits often leads to stronger employee loyalty. People who feel supported are more likely to stay, and they’re more likely to speak positively about their employer. That helps with both retention and recruitment.

Strategies to Drive Benefits Adoption

Boosting benefits adoption takes more than just open enrollment. It requires consistent communication, simple tools, and a focus on education throughout the year.

Here are four key ways HR and People teams can help employees better understand and use their benefits:

• Make each benefit easy to understand Highlight the value, how it works, and how to enroll.

• Include benefits education in onboarding Set expectations early and build awareness from day one.

• Create a year-round communication plan Keep benefits top of mind with regular reminders and updates.

• Offer contributions to fringe benefits Even small contributions can increase engagement and savings.

The first and most effective place to focus is education. Here’s how to make your benefits communication more clear and engaging.

Make Your Benefits Easy to Understand

When introducing or reintroducing plans, avoid overwhelming employees with large plan documents. Instead, focus on the essentials:

• What the benefit is

• Why it matters

• How to sign up and start using it

Make sure to include:

• Clear instructions on using a benefits card

• Guidance on filing reimbursements

• Information on mobile apps for account access

• Quick reference links or cheat sheets from your providers

What to Communicate About Specific Benefits

Here’s a quick guide to what employees need to know about your most common offerings:

High Deductible Health Plan (HDHP)

• Lower monthly premiums

• No copays

• Eligible for HSA contributions

• Preventive care is covered at 100% before the deductible

Health Savings Account (HSA)

• Must be paired with an HDHP

• Pre-tax contributions lower taxable income

• Funds roll over each year and grow tax-free

• Can be used for qualified medical expenses like deductibles, prescriptions, and co-insurance

• Share annual contribution limits and any employer contributions

Flexible Spending Account (FSA)

• Compatible with any health plan

• Employees contribute pre-tax funds for eligible healthcare expenses

• Unused funds are forfeited at year-end unless your plan allows a grace period or limited rollover

• Communicate the contribution limit and whether the company contributes

Dependent Care FSA (DCFSA)

• Pre-tax contributions for child or adult day care expenses that allow the employee to work

• Include annual limits, eligible expenses, and any employer contribution

Limited Purpose FSA (LPFSA)

• Covers dental and vision expenses

• Can be used alongside an HSA

• Share the contribution limit and employer match, if applicable

Health Reimbursement Arrangement (HRA)

• Employer-funded

• Can be paired with any health plan

• Let employees know how much is available and which expenses are covered

Pre-tax Commuter Benefits

• Covers eligible commuting costs like transit passes and parking

• Employees contribute pre-tax

• Share the monthly contribution limits and eligible expense categories

Lifestyle Spending Account (LSA)

• Employer-funded, but reimbursements are taxable

• Used for wellness, fitness, or other lifestyle expenses

• Clearly outline what’s covered, how much is available, and how often funds are renewed (monthly, quarterly, or annually)

Medical Travel Account

• Helps cover travel costs for medical care not available locally

• Employer-funded but taxable

• Clarify contribution amount, covered expenses, and how often the funds reset

Tailor Communication to Your Workforce

Not every employee engages with benefits the same way. Generational preferences, cultural differences, and work styles all play a role. To improve adoption:

• Use multiple formats like email, Slack, printed materials, or meeting callouts

• Adjust tone and content for different roles or age groups

• Offer translated materials for non-English-speaking employees

Personalizing your messaging makes it more likely that employees will read, understand, and act on the information.

Build Benefits Education Into Onboarding

New employees are often focused on learning their role, team, and tools. Choosing and signing up for benefits can easily become an afterthought, especially if your offerings differ from what they’ve had at previous jobs.

When benefits education is treated as part of onboarding, not a separate task, it creates space for employees to learn what’s available and how to get started. Framing it as part of their job helps signal that it’s not just optional information, but something that directly supports their health, well-being, and financial goals.

That early attention can lead to stronger adoption, more informed decisions, and healthier, more productive employees from the start.

Remove Barriers to Benefit Engagement

Even great benefits go unused when employees don’t know how to access them. Common barriers include confusion around eligibility, sign-up steps, or how to get help.

Most benefits are chosen during open enrollment, but that shouldn’t be the only time employees hear about them. Benefits communication should be ongoing and delivered through multiple channels.

At the start of the plan year, make sure to:

• Share benefits portals and login instructions

• Provide a one-page cheat sheet with provider contact info

• Encourage employees to download mobile apps for benefits management

• Offer translated materials if you have a multilingual workforce

Throughout the year:

• Ask providers what educational content they’re already sending, so you can support, not duplicate, their efforts

• Use templated messages and resources from your benefits partners

• Send monthly or quarterly reminders about deadlines, underused benefits, or helpful tips

Clear, regular communication helps ensure employees don’t just enroll once—they actually use their benefits throughout the year.

Consider Contributing to Fringe Benefit Accounts

One of the most effective ways to increase adoption is to contribute directly to employees' benefit accounts. Whether through matching or flat monthly contributions, employer support:

• Encourages participation

• Boosts savings activity

• Shows a tangible investment in employee well-being

Research shows that companies who seed and match HSA contributions see higher enrollment and usage than those who don’t. And pre-tax accounts like HSAs and 401(k)s can also reduce your company’s payroll tax burden. If your goal is greater engagement, employer contributions can make a measurable difference.

How Lively Supports Benefits Adoption

Lively helps employers create a better benefits experience, one that’s easy for HR teams to manage and even easier for employees to use. Here’s how we support stronger adoption:

• Bundled account administration for streamlined access to multiple benefits

• Smooth onboarding and integration with your current systems

• A mobile app that makes managing benefits simple and accessible

• The Lively Benefits Access Visa® Card a stacked card for point-of- sale transactions for multiple benefits and a simple reimbursement process.

• Built-in education with welcome emails, dashboard tips, and reminders

• Custom communication support, including templates and resources

• Responsive customer service with satisfaction scores three times the industry average

• Spanish-language support via app and live help

Ready to Improve Benefits Adoption?

If you want a benefits experience that’s easy to manage, easy to understand, and built for engagement, Lively can help. We partner with HR teams to improve employee outcomes, drive adoption, and deliver benefits that actually get used. Reach out to Lively today to learn how we can help your team get more from every benefit you offer.

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