You know the routine. When creating your corporate budget, you take your best guess at next year’s rate increase for benefits—then you watch and wait month after month to see how claims are actually trending. In good years, you’re able to breathe a sigh of relief and breeze through open enrollment with little or no change or disruption. In bad years, when the proposed increase comes in way above budget, you’ve got to get creative and have no time to waste.
Most everyone realizes that you can adjust co-pays, deductibles, coinsurance and out of pocket limits to help contain costs. You can also consider changing eligibility requirements for spouses, drug formularies and the schedule of benefits itself. There are many dials to turn when attempting to balance the value of the benefits you offer with the cost your company can sustain. But many employers miss the fact that up to 30 percent of the total cost can be turned into a purpose-driven benefit plan design change that’s a win/win for all involved.
Is your wellness program a discretionary benefit or a key strategic dial to adjust?
Consider this example: An employer funds around 75 percent of total premium costs. In order to foster behavior change, they instead fund 50 percent as a starting point and offer up to another 30 percent to employees who take a proactive role in their health, ultimately reducing costs for everyone. This allows all employees to pay less than they do today (20 percent instead of 25 percent) if they engage, but it also becomes a very effective way to motivate behavior change. Additionally, the cost of the program, the interventions and all the support needed to succeed is built into the health plan cost allowing employers to maximize the investment and develop a self-sustaining benefit solution. It’s not just wellness. A thoughtful and intentional design makes all the difference.
We’ve had tremendous success in finding the right balance between employee morale and cost savings. We can help you leverage the 30 percent. What are you doing with it?
