Open Enrollment 2025: What HR Leaders Can’t Afford to Miss

For many HR leaders, open enrollment can feel like a routine annual checklist: Update benefits documents, send reminders about plan options and selection deadlines and answer a flood of employee questions.

However, this year’s open enrollment season looks different. HR leaders are juggling rising healthcare costs, complex compliance obligations and mounting employee expectations while working with leaner budgets.

Open Enrollment Must: Know Your Workforce First

The challenge is no longer just deciding which benefits to offer. Employers must also ensure those benefits are compliant, cost-effective, clearly communicated to employees and designed to meet the needs of today’s diverse, multigenerational workforce.

Research shows 81% of employees view an employer’s benefits package as a key factor in accepting a job. Yet fewer than half (47%) report that their existing benefits align with their specific needs, and nearly two-thirds see gaps in what is offered. This underscores that the days of one-size-fits-all are over. A successful open enrollment season starts with understanding what employees actually need and tailoring benefits to those unique priorities.

Today’s workforce spans five generations, making it critical for HR leaders to understand what each group values and design benefits that support employees across each life stage. For example, Gen Z might value student loan repayment, Millennials and Gen X employees may want family-friendly benefits. Meanwhile, Boomers may be thinking about retirement planning.

The takeaway? No matter what stage in their career or life, employees need to feel seen and heard – and that includes having benefits that support all facets of their lives.

To truly understand what matters most to employees, HR leaders want to regularly collect feedback through pulse surveys, focus groups and engagement platforms. It’s also important to capture the voices of underrepresented groups, including caregivers, veterans, LGBTQ+ employees and those with disabilities.

Employers can also reinforce belonging and inclusion by using clear, accessible language in all policies and communications, simplifying benefits materials and truly reflecting your diverse workforce in imagery.

These are simple but powerful steps that help employees see themselves in their benefits. The payoff is a workforce that stays satisfied, engaged and committed, even during challenging times.

Balance Costs, Compliance and Employee Expectations

Designing inclusive health benefits goes beyond checking regulatory boxes. HR leaders want to consider the real-life experiences of their people. When done right, benefits shift from a policy binder to a powerful investment in employee health and well-being.

But the hard truth is that offering broader benefits while managing skyrocketing costs isn’t easy – and both employees and employers are feeling the sticker shock. Rising premiums, specialty drugs like GLP-1s and complex state-level laws can quickly strain even the most generous budgets. To strike a balance, HR teams can explore strategies, such as:

• Considering cost-sharing models that don’t overly burden employees, including carve-out strategies, value-based care and narrow networks
• Investing in preventative care and financial wellness to reduce long-term costs, and
• Partnering with legal experts to ensure your organization remains compliant with federal and local jurisdictional requirements, without overcomplicating benefits offerings.

Multi-state employers face an added layer of complexity because benefit requirements can differ from one state to another. For example, Illinois requires paid leave for any reason, while New York mandates paid family leave and paid sick leave separately.

The best approach for HR leaders in this situation is to offer a consistent set of core benefits across the organization and then layer in jurisdiction-specific add-ons. Ultimately, transparency is key here. When employees understand the “why” behind benefit decisions and that variations in coverage are compliance-driven and grounded in fairness, they’re more likely to view the benefits strategy as intentional rather than unequal.

Communicate With Clarity and Care

Even the most well-designed benefits package will fall flat if employees don’t understand it. Research shows that employees spend less than an hour making their open enrollment decisions, and 91% simply pick the plan they had the previous year. This underscores the need for HR teams to strengthen their benefits communications strategy.

The best approach is a multi-channel strategy that reaches employees where they are, through email, webinars, print guides, digital portals and one-on-one counseling. HR leaders should also consider using visual aids like infographics and decision support tools to cut through the complexity and help employees compare different benefits plans. Lastly, don’t overlook your managers. With the right training, they can serve as benefits ambassadors to help guide employees through their options or at least point them in the right direction for additional resources.

Ultimately, the goal isn’t to just inform employees of their options. It’s to empower them to make confident and informed benefit decisions that best suit their needs.

Turn Open Enrollment into an Opportunity

Open enrollment often feels like a compliance chore, but when done right, it can be a powerful opportunity to increase employee trust, engagement and retention. By listening to employees, designing inclusive and flexible benefits, balancing costs with care and communicating with clarity, HR leaders can transform open enrollment into a strategic advantage for both their organization and employees.

If 2025 workplace trends have taught us anything, it’s that employees don’t just want benefits. They want to feel seen, heard and supported. Open enrollment is your chance to show them that they are.