SBC Systems’ Benefits Administration Software: A Vendor Solution Brief
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By Dave Foxall
An Initial Look at SBC Systems’ Lifeworks Benefits Administration Solution
SBC Systems’ Company Overview
In 1974, the Employee Retirement Income Security Act (ERISA) changed the face of benefits administration in the U.S.; creating new costs and complexities for employers. Seeing a potential market, benefits professional, Murray Goldman founded SBC Systems—initially providing pension plan management on IBM mainframes. Having long since migrated to a Windows-based platform, SBC Systems (owned since January 2012 by Canadian benefits and pension outsourcing company Morneau Shepell), now provides software for benefits administration, health and welfare, and billing management—upselling additional options such as manager or employee self-service as needed. Pitching the popular philosophy of “by benefits professionals, for benefits professionals”, SBC Systems have continued steady growth by offering rich functionality, lower than average costs, simplified processes, and greater control over benefits administration—functionalities that have seen the company processes hundreds of thousands of individual benefits plans (both nationally and internationally) and crack the $7M revenue mark in 2011.
SBC Systems’ Lifeworks application is a web-based benefits administration software platform designed to integrate with existing employer platforms. The functionality of the following three modules can accommodate countless benefit plan designs and are scalable enough to meet the needs and size of businesses from the SMB market on up to large enterprises.
Defined Benefit Managing all aspects of pension plan administration, this solution tracks employees through their entire work cycle; from date of hire, through active employment, to retirement and payment initiation. Key features include the capabilities to:
Capture demographics, salary and service history, breaks in employment, departure and benefits commencement dates, and employee-generated retirement calculations.
Administer any number of retirement plan types; including cash balance, final average salary, flat dollar, step-rate integration, and career average plans.
Aid in identifying the best choice for the individual employee; including modeling lump sums versus annuities, calculating optional annuity forms, and sizing up options in a side-by-side comparison.
Report on numerous benefit areas; including minimum eligibility and participation, Form 5500 filing information, and a number of customizable reports.
Health & Welfare
Enabling management of a full suite of before-tax and after-tax health and group benefits, the Lifeworks solution includes feature sets for health care (medical, dental and vision plans), flexible spending accounts (including health savings accounts), life and disability insurance, and vacation and holiday buy/sell—all benefits administration software essentials. Key features are:
Robust open enrollment functionality plus mid-year life event processing.
Fully-functional reporting which includes, carrier premium reports, eligibility listings, and cost center/department billings.
The capability for interfaces with insurance carriers, third-party administrators, user payroll, and HRIS solutions to be established.
Automating the process of managing employee benefits billing management, the SBC Systems’ solution includes three types of billing (all with the same services) that allow for flexible scheduling of invoices, generation of pre-bill adjustments and retroactivity, reconciliation, and all standard accounting reports.
Direct billing: integrating with both the Lifeworks Health & Welfare and Defined Benefits modules, the system allows for invoices to be directed to individuals—who then pay the invoiced amount directly (for example, COBRA premiums).
Organization and entity billing: invoices are sent to an entity of the organization (for instance, a company, a division or a group), which then remits payment.
Premium billing: generates internal invoices to pay insurance carriers.
Additional modules and tools are also available to enhance Lifeworks functionality. For example, the Manager Self-Service (MSS) module offers a variety of transactions, with access levels governed by a proprietary rules engine which covers: open enrollment (including confirmation statements); change in status enrollment; special enrollment; changes to dependent and personal data, Life event processing, pension estimates, retirement via the Web, management of billed invoices and receivables, and a compensation history review and verification (including all cash and non-cash compensation, such as base salary, bonuses and variable compensation).
Likewise, Employee Self-Service (ESS) is also available—giving workers access to relevant information, assisting plan choices and management and reducing the administrative burden on the HR department. Other additional tools are: ad-hoc reporting for non-standard features and custom reports, total rewards statements, and the management of organizational contact details.
SBC Systems’ Customer Target Market
SBC Systems’ products are aimed at U.S. and United Kingdom organizations looking for full automation of their benefits administration. While many types of clients and a variety of industry sectors are catered to, SBC provides systems to four broad categories of customer:
Plan sponsors in a variety of industry sectors; including manufacturing, retail, insurance and banking, utilities, technology and broadcast media.
Outsourcing and third party providers as a back-office solution.
Associations that administer funds for plans with multiple employers, including faith-based and non-profit clients.
Public bodies such as county and state governments, school systems, and even federal government bodies (e.g. the Department of the Army).
SBC Systems’ Technical Specs
Powered by Microsoft .Net technology, Lifeworks can be deployed on premises on the client’s own server or via a software-as-a-service (SaaS) model.
SBC Systems’ Primary Competitors
The market for benefits administration software is broad but not necessarily complex. Often offerings are modules that fit within a wider suite of HR management solutions (such as Workday or SumTotal). Still, other vendors that (similar to SBC) specialize in benefits administration include the California-based ClearBenefits and BEMAS in Missouri.
Strengths of SBC Systems’ Lifeworks Benefits Administration System
Established in 1977, SBC have seen (and survived) the entire history of benefits administration software to date.
Recent partnerships with the UK give SBC an international element missing from most other North American vendors that specialize in benefits administration.
Ongoing automatic system maintenance and updating is bolstered by SBC support members that are often available out of hours for technical and regulatory issues.
Weaknesses of SBC Systems’ Lifeworks Benefits Administration System
SBC is purely a software vendor and as such does not directly offer managed or outsourced services (or call center support), However, the company is partnered with a number of organizations that do offer such services.
Looking ahead, it appears as though SBC Systems has taken a generalist stance—opting to try and leverage as many choices as possible for client organizations. Aside from dilution, the problem this brings is that truly specialized benefits knowledge (e.g. 401Ks) can inadvertently be given a backseat placement at the firm.
Bottom-line for SBC Systems’ Lifeworks Benefits Administration Software
SBC Systems found its niche early in the history of the human capital management software market and has stuck to it—refusing to dilute its offering by branching out unnecessarily. While for some potential that might be a drawback if they require a broader suite of interrelated solutions, for many this tight focus will be regarded as an advantage. Certainly there is no shortage of long-term clients willing to sing SBC’s praises, especially in regard to the quality of their implementation and support services. Further, with a fully up to date SaaS option, after 35 years SBC are still staying at the forefront of the industry’s technological edge.
Automating the process of managing employee benefits billing management, the SBC Systems’ solution includes three types of billing (all with the same services) that allow for flexible scheduling of invoices, generation of pre-bill adjustments and retroactivity, reconciliation, and all standard accounting reports.”