Back in college, I took a philosophy of science class and one of the topics was scientific revolutions and paradigms (ok, stay with me here). The premise is that things stay the same until they don't. Innovation occurs and the next level of thinking prevails. We've all lived through many paradigm shifts in the last many years. Technology, well-being, and social media have all brought us new ways of thinking. The pandemic will do the same in ways we may not yet appreciate (full time work from home anyone?).
But health insurance? Nope. Business acceptance of new ideas remains underwhelming. Most employer groups choose to keep the status quo so as not to upset their workforce. Increase a copay or deductible, make a change to the network, modify a contribution are all most employers are willing to do to mitigate costs. But today, incremental tweaks have very little return in actual rate difference. Bold thinking is not the norm.
Change is perceived as bad. Can't change carriers, can't mix up the health plan offering. Everyone has been lulled into complacency by accepting the fact that a 10% renewal (or 9.9% in insurance speak) is the norm. If you get a 5% renewal, your broker wants you to think they're the hero because 5% is "below trend" and you're the winner.
In a fully insured environment, you're pretty well at the whim of the insurer. Over 90% of businesses in CA with over a 100 employees are fully insured and they take what they can get. At least there is some plan design flexibility. If you're a small business with under 100 employees it's even worse as your plan options are very limited.
What if you had more control? How, you ask? There are new solutions to finance health insurance that are now becoming mainstream. Self-funding, level funding, reference based pricing, health insurance captives, and high peformance network driven HRA's are but a few ways to get serious about bending your cost curve. The latter can even work with your current fully insured program. Some even work for firms with less than 100 employees (imagine getting out of those small group plans!).
There are point solutions available to get your employees to the best doctors, thereby reducing overall spend. There are ways to incentify your employees to make better health choices in network selection and drug choice. There are many ways to get your employees engaged to be better. And yes, while these might cost upfront, the long term benefit to your benefit spend will be obvious.
Why can't a flat or declining cost curve be the norm? What are you willing to do to take control of your costs? There's so much that can be done strategically and tactically to build a long term sustainable benefits program.
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