By Lisa Kersey
Employers are tired of watching the rising costs of employee healthcare erode their bottom line. While many have reduced their contributions to employee premiums, penalized smokers, and even cut benefits altogether, it has not been enough. What’s more, according to a recent study by the Kaiser Family Foundation, employer costs as percentage of payroll vary significantly across workers and settings, compounding the shared challenge facing policy makers, employers and employees to find an affordable health insurance solution. Health reform legislation has further upped the ante, forcing benefit plans to comply with new laws, such as removing lifetime limits and pre-existing condition exclusions for children. While some would argue that these are noble, and even necessary changes, employers are too busy working with their human resource and legal teams to figure out the ripple effect of these changes and how they need to respond.
Businesses are taking different approaches to address employee healthcare needs. According to a recent study by Mercer, a benefits consulting firm, the number of large companies offering on-site health centers has increased by 4 percent in one year. By the same token, a recent Los Angeles Times article reported that major employers across the country are realizing that employer-sponsored clinics not only improve productivity and decrease absenteeism, they’re also less expensive than traditional health care.
One of the largest employers embracing in-house healthcare services is American Express. Currently, it only offers on-site services for urgent care needs , but it’s planning to provide preventive services and screenings in the future. More and more companies are realizing there is real economic benefit to bringing health services in-house. While some employers are hiring their own clinical providers, others are outsourcing the staffing of their health centers. In fact, the outsourcing option is rejuvenating the clinical staffing and management industry. One of the industry leaders has already doubled its business in the past three years and expects more of the same as employers explore B2B partnerships to reign in their health-related expenditures.
Despite the emergence of these models, National Business Group on Health, conducted a survey of large employers which showed that many employers are still relying on a variety of cost-sharing strategies to help control health-related costs. The most common strategy, increasing the employee percentage contribution to the premium, has been adopted by 63 percent, up 6 percent from 2010. Meanwhile, the number of employers that have raised out-of-pocket maximums has increased by 10 percent in the past year. Must we really revisit the definition of insanity??
Between stimulus funding, venture capitalism and pure economic principles, employers cannot honestly hope to cost-share their way out of this conundrum. There’s a lot of innovative thinking going on out there and there are a number of B2B opportunities for creating a healthier workplace. If you want to remain viable and competitive for the long term, and if you want to do your part to bend the healthcare cost curve, as a corporate citizen, even a U.S. citizen, try something different! Suit up Chief Executive Officers, Human Resource Executives, Business Development Executives and Chief Financial Officers! It’s your turn at bat in the World Series of Healthcare.