Communicating Open Enrollment When Benefits Are Shrinking

Open Enrollment is an opportune moment to engage employees each year by inviting them to participate in your company’s benefit programs. But what do you do when your company’s offerings include reductions in benefits or coverages?

This will be a reality for some companies this year, as rising health care and prescription drug costs, inflation and economic pressures force a recalibration of benefits strategies. Your approach to communication will affect the way employees feel, not just about the value of their benefits. It will also affect their impression of your company and its leaders.

How benefits are changing

Across industries, the landscape of employee benefits is shifting — and not always for the better. According to the Willis Towers Watson’s (WTW) 2025 Benefits Trends Survey, over two-thirds of global employers (69%) cited cost and budget concerns as a central issue shaping their benefits strategy.

That pressure is prompting many companies to rethink how benefits are structured and delivered.
Health care is often the first area affected. Some employees are seeing higher premiums, deductibles and co-pays. Some are discovering that their preferred providers are no longer in network, as companies narrow options to control costs. According to WTW, only 8% of employers plan to expand their benefits portfolios, while 63% intend to reallocate or rebalance spending over the next three years.

Beyond health care, some companies are looking at scaling back retirement contributions, and wellness programs such as gym subsidies and mental health apps are quietly disappearing. Perks introduced during the pandemic, like caregiver support and flexible work stipends, now face reevaluation, with some employers reducing or eliminating them altogether.

This shift reflects a broader trend: Companies are moving away from expansive, one-size-fits-all benefits and toward more cost-efficient, targeted offerings. While this may make financial sense, it can feel like a loss to employees who have come to rely on these programs.

Communicating changes to benefits

When benefits are shrinking, communication must be strategic, direct and grounded. Here are five key approaches to consider:

1. Be transparent and empathetic.

There’s an old saying: You can’t put lipstick on a pig — people will still know it’s a pig! So first and foremost, avoid sugarcoating. Take an honest approach that will foster trust with your employees, even if they don’t like the changes. Be clear and straightforward. Explain what’s changing and why, whether it’s vendor pricing, low utilization rates or strategic reallocation due to inflation and budget pressures.

Acknowledge potential impacts sensitively and, where possible, share alternatives. For example, if your company decides to end gym subsidies, share new or related offerings, such as a wellness app, employee fitness clubs (running, cycling, etc.) and company fitness challenges. A company reducing mental health days could direct employees to expanded Employee Assistance Programs (EAPs) with 24/7 virtual access.

2. Share employee feedback.

Some companies are tackling benefit pressures head-on—analyzing program usage, surveying employees, and aligning offerings with their preferences. They’re also highlighting how that feedback shaped benefits changes during the Open Enrollment rollout. This demonstrates a thoughtful, inclusive approach to decision-making that people will notice. If your company hasn’t conducted a benefits survey recently (or ever), start planning one for 2026 to help make decisions and shape your offerings.

3. Highlight what’s valuable.

Being transparent applies equally to the benefits you continue to offer. Be strategic in your approach: Emphasize competitive offerings and those that employees use and value the most.

It goes without saying that this is also the time to spotlight new offerings. More companies are introducing GLP-1 drug coverage for diabetes and weight loss, critical illness insurance and hospital indemnity insurance, among others. And it’s important to provide information about all offerings; be mindful not to focus on the ones that apply only to a few. For example, an increase in paid military leave is great, but it helps only a small percentage of employees.

4. Equip leaders.

Remember to alert your leaders and managers to upcoming benefits changes well in advance and provide them with talking points and FAQs that promote a consistent message. If your company holds regular manager meetings, having your HR team provide a live explanation of the changes gives managers the opportunity to ask questions and better prepare for employee conversations. Unwelcome changes are made worse when leaders tell different stories, undermining their own credibility and eroding employee confidence.

5. Take a year-round, “Total Rewards” approach to benefits communication.

Organize all your benefits offerings into a Total Rewards package and align messaging with your company’s Employee Value Proposition for added impact. Create fun monthly campaigns that link your offerings to national and international awareness days. Use your intranet homepage, HR website, newsletters, webinars and manager toolkits to keep employees informed and engaged throughout the year.

A decline in benefits doesn’t have to mean a decline in employee trust. With thoughtful, candid and proactive communication, you can turn a difficult message into an opportunity to reinforce your company’s commitment to employees, even in leaner times.

At ROI, we’re experts at creating effective communication strategies and programs to communicate benefits at Open Enrollment time and throughout the year. Contact us if we can help.

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