Unemployment is at record lows and employees know the pendulum of leverage tilts in their favor (I QUIT!). We feel that so much of healthcare is out of our control, and there are certainly some instances that is the case, but there has never been a better time to unleash you conceptual thought process to how this can be better. These same questions have been asked countless times in companies, they’ve just never seriously journeyed into the healthcare dialogue. Sure, you discuss your wants and needs with your insurance broker while keeping within a budget but, have you really sat back and analyzed what it takes to provide a truly high-performing health plan? Here are three questions to ask yourself if you purchase healthcare for employees.
Q1. Can our organization continue to absorb the cost increases when the economy slows?
It will slow down at some point. The labor leverage will be back in your favor but if health care costs continue to climb, how much will that impact EBITDA? Planning for the future is critical and you must do away with the thought of “this only comes around one time per year.” When actual wages has its thresholds, you must look to enhance other areas that your employees value. This is imperative for talent attraction and retention during this growth period. Factoring in both premium contributions and cost-sharing in the form of deductibles and co-payments, employees are being asked to give up more and more of their wages. In some cases, we’re talking about 18% of take-home pay going towards medical expenses. This is a financially devastating position for employees and how can an employer sell that in their recruiting efforts? Common-sense fixes exist and successful transformation can be incremental. Begin building your plan now to avoid snap decisions later that could have far greater consequences.
Q2. What can I invest in today that has or will have a positive benefit to my employees?
Healthcare costs are at the front of your workers’ minds. Employers, employees, and governments are trying to find ways to improve our system while lowering costs. There are several strategies you can implement today that will have a positive impact to your workforce. Implementing savings strategies around your Rx spend, bundled pricing arrangements, and direct contracting are just three avenues you can explore. This is a marathon, not a sprint. Tackle the low-hanging fruit first, like pharmacy and surgeries, while keeping the rest of your plan unchanged. You’ll enjoy nice bang for your buck and want to see where else your plan can be optimized.
Q3. How will this impact our employees?
The BIG question that tends to keep us continuing on the same path year after year. Healthcare is a personal journey that has been cast onto employers. Of course you don’t wish to tell your employees what to do for their care but you must also realize that the US consumer has been blind to our health care system. It’s quite difficult to navigate a system that hides cost and quality metrics. Nobody chooses to go on a healthcare journey but it is inevitable for us all. The reality is that most people don’t have the support of resources necessary to help them ask the right questions leading them to make the best possible decisions for them and their family. It is important to work with independent organizations that can help employees make informed decisions and become health literate. This can be accomplished through Direct Primary Care (DPC), an engaged medical management firm, or a Pharmacy Benefit Manager (PBM) that works in the best interest of the plan and the employees’ health.
Being part of a grass roots movement called the Health Rosetta, has accelerated my passion to make a change for the better in healthcare. This is an open source working group of like-minded benefit advisors and doers across the country sharing the most innovative ways to improve benefits while lowering costs. These are proven ways, that can be replicated, to structure a plan that truly makes a positive impact for employees and employers.
The best place to begin is to analyze your current business relationships and determine, does this person, or persons, have the unbiased ability to help my team and employees re-engineer our plan to create the value we yearn for? Will this plan save my employees money while creating an ROI to me? Can they create a competitive advantage for the future and provide a better experience for our greatest asset?
The time to take action is now. You will always be refining and improving but now is the time for you and your team to take that next step outside the box.
“We keep moving forward, opening new doors, and doing new things, because we’re curious and curiosity
keeps leading us down new paths.” – Walt Disney
*credit to the Kaiser Family Foundation for the graph data from 2005-2015