MENUMENU
  • FREE RESOURCES
  • PREMIUM CONTENT
        • SEE MORE
          PREMIUM RESOURCES
  • HR DEEP DIVES
        • Coronavirus (COVID-19) Resources for HR Professionals
          Employment Law
          Labor Law Posting Requirements: Everything You Need to Know
          Recruiting
          businesswoman selecting future employees on digital interfaces
          Recruiting Resources for HR & Hiring Managers
          Performance Management
          vector image of young female making star rating
          Performance Review Resources
          Employment Law
          Understanding Equal Employment Opportunity and the EEOC
          Recruiting
          Onboarding Resources for HR & Hiring Managers
  • CORONAVIRUS & HR

  • LOGIN
  • SIGN UP FREE

HR Morning

MENUMENU
  • FREE RESOURCES
  • PREMIUM CONTENT
        • SEE MORE
          PREMIUM RESOURCES
  • HR DEEP DIVES
        • Coronavirus (COVID-19) Resources for HR Professionals
          Employment Law
          Labor Law Posting Requirements: Everything You Need to Know
          Recruiting
          businesswoman selecting future employees on digital interfaces
          Recruiting Resources for HR & Hiring Managers
          Performance Management
          vector image of young female making star rating
          Performance Review Resources
          Employment Law
          Understanding Equal Employment Opportunity and the EEOC
          Recruiting
          Onboarding Resources for HR & Hiring Managers
  • CORONAVIRUS & HR
  • Employment Law
  • Benefits
  • Recruiting
  • Talent Management
  • Performance Management
  • HR Technology
  • More
    • Leadership & Strategy
    • Compensation
    • Staff Administration
    • Policy & Procedures
    • Wellness
    • Staff Departure
    • Employee Services
    • Work Location
    • HR Career & Self-Care
    • Health Care
    • Retirement Plans

How the best companies hold the line on health plan costs

FLSA, overtime, regulations
Christian Schappel
by Christian Schappel
April 16, 2014
3 minute read
  • SHARE ON

What’s the prescription for bringing healthcare costs under control? It’s not a single cure-all, but rather a series of medications designed to work together to keep your health plan costs from crippling you. 
Unfortunately, there’s no singular magic elixir to cure what ails your health plan: rapidly increasing costs.
The good news, however, is a treatment regimen does exist that can keep cost increases closer to inflation than what they typically have been for most companies: four to five times inflation.
Towers Watson, a renowned human resources consulting company, and the National Business Group on Health (NBGH), a non-profit advocate for large employers’ healthcare concerns, just conducted their 19th annual survey of large employers to pinpoint the most effective healthcare cost control strategies.
While the full results won’t be released until later this month, we can look back on the results from last year’s survey in anticipation and see what’s traditionally been most effective at controlling healthcare costs.
Last year’s survey was completed by 583 employers. Towers Watson and NBHG separated out the companies that had the greatest success keeping healthcare costs down and identified the most common measures those employers took to rein in costs.
While the survey respondents were large employers (each had at least 1,000 employees), and thus many were self-insured, most of the cost control strategies they used can be applied to just about any group plan.

Best cost-control strategies of 2013

The most implemented strategies of top performers last year:

  1. Procured a pharmacy benefit manager in an attempt to tamp down pharmaceutical costs
  2. Provided employees with healthcare cost transparency — revealing the price per service
  3. Consolidated health and productivity programs under a single vendor
  4. Contributed funds to employees’ health savings accounts
  5. Provided tools via health plans that reveal service prices and hospital quality info
  6. Audited their pharmacy benefit manger
  7. Invested in enhancing case management for serious, high-cost health conditions
  8. Offered educational resources by way of social media, discussion forums and blogs to help employees make better decisions about their health and care
  9. Rewarded or penalized employees based on biometric screening data (not related to smoking status), and
  10. Created wellness rewards and penalties, and tied them to measurable improvements among employees and spouses alike.

Top strategies for 2014

The survey also asked top performers what their cost-containment strategies were for the 2014 plan year, because, as Towers Watson and HBGH put it: “Best performers are successful over the long term because they continue to look for new ways to lower costs.
The most popular strategies for 2014:

  1. Make plan design changes after analyzing how they’ll impact other parts of employee compensation — like retirement contributions and salary
  2. Manage the employer-provided health subsidy as part of the total rewards budget rather than as a health plan budget item
  3. Increase employee contributions in tiers with dependent coverage at a higher rate than individual coverage
  4. Structure employee contributions based on employees taking specific steps to improve their health
  5. Adopt payment methods that hold healthcare providers more accountable for the quality and cost of care
  6. Offer telemedicine programs
  7. Base account-based health plan contributions on employees’ health management and wellness activities
  8. Offer specialty treatment providers/networks
  9. Formally track outcomes from vendors
  10. Use reference-based pricing for medical plan
  11. Contract directly with physicians, hospitals and/or accountable care organizations, and
  12. Provide access to private or corporate health exchanges.

Info: Reshaping Health Care: Best Performers Leading the Way, from Towers Watson and NBGH.
 

Get the latest from HRMorning in your inbox PLUS immediately access 10 FREE HR guides.

I WANT MY FREE GUIDES

Keep Up To Date with the Latest HR News

With HRMorning arriving in your inbox, you will never miss critical stories on labor laws, benefits, retention and onboarding strategies.

Sign up for a free HRMorning membership and get our newsletter!
  • This field is for validation purposes and should be left unchanged.
HR Morning Logo
  • Facebook
  • Twitter
  • Linked In
  • ABOUT HRMORNING
  • ADVERTISE WITH US
  • WRITE FOR US
  • CONTACT
  • Employment Law
  • Benefits
  • Recruiting
  • Talent Management
  • HR Technology
  • Performance Management
  • Leadership & Strategy
  • Compensation & Payroll
  • Policy & Culture
  • Staff Administration
  • Wellness & Safety
  • Staff Departure
  • Employee Services
  • Work Location
  • HR Career & Self-Care

HRMorning, part of the SuccessFuel Network, provides the latest HR and employment law news for HR professionals in the trenches of small-to-medium-sized businesses. Rather than simply regurgitating the day’s headlines, HRMorning delivers actionable insights, helping HR execs understand what HR trends mean to their business.

Privacy Policy Terms of Service
Copyright © 2021 SuccessFuel

WELCOME BACK!

Enter your username and password below to log in

Forget Your Username or Password?

Reset Password

Lost your password? Please enter your username or email address. You will receive a link to create a new password via email.

Log In

During your free trial, you can cancel at any time with a single click on your “Account” page.  It’s that easy.

Why do we need your credit card for a free trial?

We ask for your credit card to allow your subscription to continue should you decide to keep your membership beyond the free trial period.  This prevents any interruption of content access.

Your card will not be charged at any point during your 21 day free trial
and you may cancel at any time during your free trial.

preloader