EMPLOYEE HEALTH CARE PROGRAMS: THE TIMES, THEY ARE 'A CHANGIN'

2The complex interaction among evolving employee needs for medical services, skyrocketing health provider costs, and lingering uncertainty over health care reform is transforming traditional health benefits programs from top to bottom.

The lingering recession has had a significant impact on these plans. If you're like most businesses, you're focused more closely than ever on the bottom line; curbing costs wherever possible. In this challenging environment, it's all too easy to lose sight of your most valuable asset -- your workers -- and the need to provide health care benefits that can play a key role in boosting employee retention rates and generating the growth in productivity your business will need when the economy starts to take off again.

Although economic pressures prevent many workers from leaving their jobs, a nationwide survey sponsored by MetLife found that one in three employees expected to change jobs during the next year. According to the study, workers who were happy with their health benefits program were almost three times more likely to remain in their current positions than were respondents who didn't have a satisfactory plan.

An effective, comprehensive, cost-effective employee health benefits program should include these elements:

  • Freedom of choice. The health care needs of your workers can vary widely, depending on their age, gender, life style, medical history, etc. -- which means that old-fashioned cookie-cutter plans just won't cut it. It makes sense to let employees choose from among the "alphabet soup" of benefit options (such as PPOs, POS's, HRAs, and ACOs), and work with them to tailor a program that fits their situation.

  • Cost control/cost sharing. Budgetary constraints make it essential to curb the cost of benefit plans. For example, take a close look at whether the dependents of your employees are eligible for the program. According to some studies, nearly one in seven dependent beneficiaries don't meet eligibility criteria -- and these freeloaders account for 7 cents of every dollar spent on employee health benefits. Employees will need to put "skin in the game" by taking higher deductibles and paying more out-of-pocket costs.

  • Proactive employee participation. Encouraging workers to help keep themselves healthy will benefit them -- and boost your bottom line -- by increasing productivity and reducing the cost of your benefit program. You can offer participating employees a variety of financial incentives, ranging from gift cards for taking a comprehensive physical to premium reductions in return for such lifestyle changes as losing weight and giving up cigarettes.

  • Non-traditional benefits. Give employees the opportunity to supplement their health plan with a "Chinese menu" of voluntary benefits, for which they'll pick up the tab. These products usually include Life and Long-Term Disability insurance, Dental and Vision plans, identity theft, and legal services.
Choosing the best employee benefits programs for you and your workers can be a daunting task. As your insurance professionals, we stand ready to help. Just give us a call.
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