How to choose benefits administration software: 6 steps for businesses

Benefits administration takes time. HR teams can find themselves drowning in manual (and sometimes error-prone) processes. 

But we’ve got good news. Benefits administration software can handle the heavy lifting. Your team can focus on strategic oversight instead. And in 2025, we can expect benefits to get more expensive among macroeconomic uncertainty. As a result, we recommend that businesses find the right platform now to avoid benefits complexity moving forward. 

These tools can streamline HR tasks, reduce inevitable human errors, and ensure compliance. The right platform transforms how HR teams manage employee benefits.

The last thing you want is a simple data entry mistake to impact essential benefits like an employee’s retirement contributions. A competitive benefits package becomes less valuable if enrollment is a headache. 

In this post, we’ll discuss how to choose benefits administration software for your business, including discussing six of the top picks on the market in 2025.

What does benefits administration software do?

Benefits administration software helps HR teams manage employee benefits digitally. It automates enrollment, tracks eligibility, ensures compliance, and gives employees self-service tools. 

The best benefits software doesn’t just digitize old forms—it rethinks the entire experience to eliminate manual work. Think of it as the central nervous system for your benefits program. 

If an employee gets married and notifies your team? The software updates their coverage, adjusts payroll deductions, and notifies the right carriers. While the wedding bells are ringing, software updates coverage, adjusts payroll, and makes it easy for your employee to sign their spouse up for new benefits. 

No phone calls. No manual data entry. No mistakes. This can simplify the process for both employees and HR teams.

5 benefits of benefits administration software

The right benefits administration software delivers immediate improvements across your entire HR operation. These five benefits are the most significant. 

1. Streamlined enrollment and onboarding processes

Benefits administration software can reduce enrollment chaos. They may have guided workflows that walk employees through their choices step-by-step. 

• Calculate potential benefits costs in real-time

• Check eligibility automatically

• Flag missing information or delayed enrollment before it can create a problem 

It’s easier for employees to enroll and it saves HR teams time as a result. 

2. Enhanced compliance and risk management

Compliance violations are expensive. In 2024, for example, an ACA violation could result in a fee of $2970 for each full-time employee. Benefits administration software eliminates these risks by automating compliance management.

The best benefits administration software can track every requirement, including:

• ACA reporting deadlines

• COBRA notifications

• HIPAA documentation

• State- or industry-specific regulations. 

It can also maintain audit trails and alert you to upcoming deadlines. That way your team is ready for any upcoming audit or reporting requirements. 

3. Improved employee experience and engagement

Benefits administration software provides 24/7 access to benefits details. Employees to view coverage and download benefits information and documentation at any point. 

Workers can enroll in benefits or make life event changes. And they can do it without needing to contact their HR professionals. They may also be more likely to enroll in retention-boosting benefits like education assistance.

4. Reduced administrative burden and costs

Manual benefits administration can be a massive time sink for busy teams. Fortunately, benefits administration software automates busywork like eligibility updates or carrier communications. 

Your HR employees stop being data entry clerks and have more time to act as the strategic partners they are.

Employee life event changes that used to take 30 minutes now happen in seconds. Carrier reconciliation becomes automatic. Exploring small business employee benefits options has never been easier. 

The time savings can translate to reduced administrative or operational costs. Your team can do more with less and net a positive ROI. 

5. Scalability for growing businesses

Benefits administration software scales with your business. It can accommodate new employees or benefit plans. It can even keep up with evolving compliance requirements. 

Platforms like Rippling can handle:

• Multiple carrier relationships

• Complex eligibility rules

• Varied benefits packages across different employee groups

6 essential features of benefits administration software

Not all benefits platforms are created equal. Focus on these core capabilities when evaluating your options. 

1. Employee self-service portal

Strong self-service portals empower employees to manage their benefits independently. Look for platforms that provide intuitive interfaces. Employees should be able to:

• Navigate the enrollment process seamlessly

• Compare benefits options (including retirement plans and health insurance plans) 

• Easily add or remove dependents

• Check their eligibility for specific benefits 

This self-service approach reduces HR workload. It simultaneously gives employees better access to their own benefits. 

2. Automated enrollment and eligibility tracking

Software should automatically manage complex eligibility rules based on factors like employment status. It should also automate enrollment processes for both employees and HR teams. 

Advanced platforms can handle sophisticated scenarios such as:

• Different eligibility requirements for various benefit types

• Automatic enrollment in certain plans

• Coordination with collective bargaining agreements

3. Compliance management (ACA, COBRA, HIPAA)

Comprehensive compliance management features should cover major regulations. These include ACA reporting, COBRA administration, and HIPAA privacy requirements. 

The software should also:

• Generate the required forms automatically

• Track essential deadlines

• Notify your team of upcoming deadlines

• Maintain documentation for audit purposes

Look for platforms that stay up to date with regulatory changes. They should update their compliance features. This ensures your organization remains compliant even as regulations evolve.

4. Integration capabilities with payroll and HRIS

Seamless integration with your existing payroll and HRIS platforms is crucial for maintaining data accuracy. It’s also essential for reducing administrative workload. The software should prevent discrepancies by syncing:

• Employee data

• Deduction amounts

• Coverage information

Compare each tool’s API capabilities and pre-built integrations with your tech stack. 

5. Reporting and analytics dashboard

Comprehensive reporting capabilities help you track critical metrics. 

Look for platforms that offer customizable dashboards and automated report generation. The reporting should cover:

• Financial metrics, like benefits cost

• Enrollment statistics

• Compliance status

• Employee satisfaction measures

Advanced analytics can help identify trends and opportunities for benefits program optimization. Your team can then make more informed decisions. 

6. Multi-carrier support

Most organizations work with multiple benefits carriers for different types of coverage. Your benefits administration software should support integration with various carriers. It should also be able to handle different data formats and communication protocols.

The platform should:

•  Facilitate electronic data interchange (EDI) transactions with carriers

• Automate enrollment files

• Reconcile carrier bills

Multi-carrier support simplifies vendor management. This can reduce required coordination efforts and free up your team to work on more crucial tasks.

Top 6 benefits administration software picks for 2025

The best employee benefits administration software will depend on your business’s needs. Let’s review six of the best options on the market in 2025. 

1. Rippling

Rippling offers a powerful all-in-one benefits administration platform. The platform automates benefits enrollment and manages carrier relationships. It also provides real-time synchronization between benefits, payroll, and HR data. 

Key features include:

• Comprehensive benefits offerings, including retirement plans, medical insurance, FSAs, HSAs, and more 

• Streamlined shopping for new, affordable benefits with easy quote comparisons

• User-friendly dashboard to assess employee enrollment status

• Employee self-service portal

• Compliance functionality 

• Integration with major benefits carriers

Rippling is ideal for businesses of all sizes. There are essential tools for small businesses and advanced tools for global enterprises. We offer comprehensive HR functionality with robust benefits administration capabilities. 

And best of all, the ROI and cost-benefit potential is real. “With Rippling, we saw an immediate cost benefit, a great user experience as far as benefits sign up,” said Jenn Perea, who was the People Business Partner of Osso VR. “But we also saw a platform that we could grow with because it's also growing in its offerings.” 

2. BambooHR

BambooHR provides benefits administration as part of its HRIS platform. 

Key features include:

• Employee eligibility tracking

• Open enrollment period management

• Compliance report generation

• Strong customer support

• Automated enrollment workflows

BambooHR is a popular choice for small to medium-sized businesses wanting an integrated HR solution.

3. Workday

Workday offers enterprise-grade benefits administration in its human capital management (HCM) suite. 

Key features include:

• Global benefits support

• Decision support tools for employees

• Extensive reporting capabilities

• Sophisticated benefits modeling

• Complex eligibility management

• Advanced analytics capabilities

Workday is well-suited for large enterprises with complex benefits programs. 

4. Gusto 

Gusto combines payroll and basic benefits features in a user-friendly platform. 

Key features include:

• Simplified enrollment processes

• Automatic payroll deductions

• Basic compliance management

• Employee self-service

• Small business benefits carrier integration

Gusto's strength is its simplicity and ease of use. It’s ideal for small businesses that need basic benefits administration. 

5. Justworks 

Justworks is a Professional Employer Organization (PEO) tool. It provides access to enterprise-level benefits through its platform. 

Key features include:

• Automated administration

• Employee self-service

• Access to large-group insurance rates

• Compliance management

• Workers' compensation

• HR support services

Justworks may benefit mid-sized businesses looking to outsource their benefits administration via PEO. It’s a good option for those who want more options without complex direct carrier relationships. 

6. TriNet

TriNet offers benefits administration through its PEO platform. This provides access to Fortune 500-level benefits for small and medium-sized businesses.

Key features include:

• Access to carrier options

• Comprehensive compliance support

• Strategic HR consulting

• Automated enrollment

• Dedicated HR support

• Fortune 500-level benefits access

TriNet's strength lies in its combination of technology platform and human expertise. It may benefit  growing businesses that want enterprise features and HR support. You can see our breakdown of TriNet vs. Justworks for more.

The only HR solution you need as your business scales

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How to choose benefits administration software: 6 steps 

Choosing the wrong benefits platform costs more than money. It can be time-consuming, create compliance risks, and result in a poor employee experience. It’s why you don’t want to choose a platform based on price alone, or to be swept away by flashy features. You’re setting yourself up for failure if you don’t find a solution that meets your current and future needs. 

It’s important to select a platform that will align with your organization’s current and future needs. Let’s break down the six steps to follow when making your selection.

Step 1. Assess your current benefits administration challenges

Begin by conducting a thorough evaluation of your existing benefits administration processes. Document current pain points such as:

• Manual data entry requirements

• Enrollment errors

• Compliance gaps

• Employee complaints about benefits access

Gather input from stakeholders like HR staff, payroll administrators, and benefits brokers. 

Step 2. Define your organization's specific requirements

Develop a comprehensive requirements document that outlines your organization's unique needs. Consider factors such as:

• Company size

• Number of locations

• Employee demographics

• Benefits complexity

• Growth projections

A small startup will have different needs than a company with branches in several states. 

Define must-have features versus nice-to-have capabilities. Must-have features might include:

• Specific compliance requirements

• Carrier integrations

• Reporting capabilities critical to your business operations 

Step 3. Evaluate integration needs with existing systems

Catalog your current HR technology stack. These tools may include:

• HRIS platforms

• Payroll systems

• Timekeeping platforms

• Accounting software 

Identify which systems need to integrate with your benefits administration platform. Assess the quality and availability of APIs and pre-built integrations. 

 Poor integration capabilities can lead to data silos or ongoing maintenance challenges.

Step 4. Research and compare potential vendors

Create a vendor evaluation matrix that compares platforms against your defined requirements. Research each vendor's market position, financial stability, customer base, and product roadmap.

Read customer reviews and case studies. Pay close attention to companies similar to yours in size and industry. Look for patterns in customer feedback about implementation and ongoing support. 

Evaluate vendor reputation in areas such as:

• Data security

• Compliance expertise

• Ability to adapt with regulatory changes

• Innovation

Finally, their track record of product development.

Step 5. Request demos and trial periods

Most companies offer either free trials or demos—or both. Make sure that you use them to get a solid understanding of how the platform will work for you. 

Let’s say you need an enterprise solution with automated compliance notifications. You can ask the salesperson to go over those options during the demo. 

That said, request access to trial environments or pilot programs where possible. Hands-on experience can reveal usability issues or feature gaps. 

Step 6. Calculate total cost of ownership

Develop a comprehensive cost analysis that includes:

• Software licensing fees

• Implementation costs

• Training costs

• Integration expenses

• Ongoing support charges 

Don't forget to factor in internal resource costs for implementation and ongoing administration. 

Tools that have fewer native integrations may require more extensive developer resources. Your tech team may need to create the integrations you need through custom API options. 

Compare pricing models, too. Vendors may charge based on the number of users, feature usage, or transaction volume. Make sure you understand how costs will scale as your organization grows. 

Finally, remember to consider ROI. Our report found that the payback period for the investment in Rippling is less than 6 months.

Streamline your benefits administration with Rippling

When it comes to top benefits administration software, Rippling shines. Rippling’s benefits administration is an intuitive tool that streamlines employee benefits management. 

Rippling makes it easy to manage benefits with its unified platform approach. Handle enrollment, carrier communications, and compliance reporting in one place. You can leverage pre-built workflows for common benefits scenarios or create custom benefits experiences based on your company’s requirements. 

Beyond its robust feature set as benefits software, Rippling stands out for its ability to integrate benefits administration with the core HR, payroll, and IT processes it already streamlines. 

It can automatically trigger benefits enrollment and payroll deductions for new hires, adjust coverage when employees change roles, and ensure compliance across all systems. It’s a true all-in-one solutions that can scale alongside your business. Ready to streamline your entire HR operation? Request a demo to see Rippling in action.

FAQs on how to choose benefits administration software

How do I measure ROI from benefits administration software?

You can calculate ROI by quantifying the following:

• Time savings

• Error reduction

• Compliance risk mitigation

• Improved employee satisfaction 

You can compare this data against hard savings. You may reduce administrative hours thanks to fewer manual processes. 

How long does it take to implement benefits administration software?

Simple implementations for small businesses might take four to eight weeks. Meanwhile, more complex enterprise deployments may take at least three to six months. 

Can benefits administration software integrate with existing HR systems?

Yes. Most modern benefits administration platforms offer integrations with popular HRIS and payroll systems. 

What compliance requirements should the software support?

Your benefits administration software should support all applicable federal and state regulations. This includes:

• ACA reporting requirements

• COBRA administration

•  HIPAA privacy protections

• State-specific mandates.

 The platform should also have built-in compliance features. This may include generating forms and maintaining audit documentation.