As health care costs continue to soar, an increasing number
of businesses are foregoing traditional plan designs in favor
of alternative solutions that can help them control health
care spending over the short and long haul.
A recent report released by Watson Wyatt Worldwide found
that for 2006, many businesses plan on changing their current
health plan offerings in one of five ways:
- Increased Usage of Coinsurance and Deductibles
More employers will add first-dollar cost sharing to their
employee benefits plans. Instead of paying the usual $15-$25
co-payments for doctor and hospital visits, employees will
now be responsible for paying medical expenses up to a specified
deductible level. Once the employee reaches the deductible,
the employer will reimburse the employee for a certain percentage
- generally 80% - of their medical costs.
- •Redesigned Cost Arrangements for Prescription
Drug Benefit Plans
Employers will replace traditional plans that use co-payments
for generic and brand-name drugs with those that require
co-insurance and deductibles in order to shift more of the
plan costs to participants. Employers are encouraging the
use of available generic drugs, which cost less than name-brand
prescriptions, by providing better coinsurance provisions
- High-Deductible/Personal Health Care Accounts
To lower premium costs for themselves and their employees,
an increasing number of employers will add high-deductible
health plans (HDHPs) as an option to their current benefit
portfolio. Employers will tie HDHPs to personal health care
savings accounts, such as Health Savings Accounts (HSAs)
and Health Reimbursement Accounts (HRAs) in order to help
employees meet the high deductible and pay for other out-of-pocket
medical costs (scroll up for related article, WAGING THE
WAR ON RISING HEALTH CARE).
- Health-Risk Assessments and Wellness Programs
Tied to Financial Incentives
Many employers will offer financial incentives to employees
who complete on-site health risk assessments and participate
in company-sponsored wellness programs. The incentives will
be used to encourage and reward employees who adopt healthy
lifestyles and take proactive steps towards managing/preventing
chronic illnesses in an effort to help employers slow chronic
claims activity and reduce long-term premium costs.
- Improved Access to Online Decision-Making Tools
Employers and insurance providers will provide employees
with online tools that can help them make informed decisions
about their health care. These tools can help employees
figure out the dollar impact of their various health plan
options, check the status of claims, create personal health
records, and research specific diseases and wellness topics
to choose the most appropriate course of treatment or prevention.
"Viable health care solutions that help employers and
employees gain control of rising health care costs do exist,"
notes Denise Angleman, senior vice president of the Employee
Benefits Division at The NIA Group. "However, it is often
difficult for both parties to navigate the complex and rapidly
changing landscape of employee benefits on their own. Working
with an experienced employee benefits broker who can explain
the options available is key to customizing a plan that is
right for them."
For more information on any of the employee benefits options
presented above, contact your NIA Employee Benefits Specialist
or Denise Angleman at 201.845.6600,
Ext. 1259 or firstname.lastname@example.org.