Americans don’t agree on much, but everyone acknowledges that healthcare costs are just too high. Even employees who have no complaints about their employer-sponsored insurance are aware that providing high-quality coverage puts a big burden on the company. Ballooning insurance costs translate to financial strain, which trickles down to employees in the form of budget cuts and staffing changes.
That’s why it makes so much sense to include employees in discussions about rising healthcare costs. That might represent a radical change from the status quo in some companies, but it’s a change worth making. Employee engagement looks different in each company, and it’s up to the employer to find the blend of programs and initiatives that’s most beneficial – both for employee health and satisfaction, and for the bottom line.
Offering to foot the bill for employees’ gym memberships and smoking cessation programs can really pay off in the long run. In the 2013 RAND Wellness Programs Study, which included more than 600,000 employees, researchers found that employers who offered wellness programs saw a return of investment of $1.50 in health care costs for every dollar spent on the programs. Other studies have found ROIs of $2 to $3 per dollar spent on wellness programs. As long as the employer designs wellness programs without violating the privacy of or excluding any employees, these offerings can be hugely successful for everyone.
“How much will that cost?” is a question that too few Americans know to ask of their healthcare providers. Without knowing the costs that are associated with services, employees commit to out-of-pocket expenses that they can’t afford. Encouraging employees to ask their providers for price transparency empowers them to make the best choices for themselves and their families, while also helping to keep their employers’ costs down. Massachusetts law requires physicians and hospitals to provide price estimates when patients ask for them. Make sure employees know that they can exercise that right.
It’s definitely not an employer’s place to tell employees not to not to seek medical treatment. That’s a decision that only the individual and his or her doctor should make. But when patients visit the emergency room for a non-emergency visit, the costs pile up quickly. In a 2015 survey done by the American College of Emergency Physicians, 75 percent of ER physicians reported that their departments have seen patient numbers increase slightly or greatly since the rollout of the Affordable Care Act. Considering the average ER visit costs upwards of $1,000 – and some visits cost significantly more – it’s clear that unnecessary trips put a financial burden on both employees and employers. Taking steps to curb those trips is in everyone’s best interest. That might mean making it easier for employees to access clinics and urgent-care centers and/or setting ER copays at a higher rate to discourage nonessential visits.
Prescription drug costs are skyrocketing, making it difficult or sometimes impossible for employees to afford the medications that they and their families need. Using a pharmacy carve-out method – in which an employer contracts a pharmacy benefits manager (PBM), who administers the employer’s pharmacy benefits – gives the employer the flexibility to design a pharmacy plan that meets its specific needs, and to negotiate for the lowest-priced benefits. This strategy also allows for more price transparency than other methods, meaning that the employer’s costs and the employees’ out-of-pocket costs are limited.
Have questions about how to cut costs without sacrificing the quality of coverage your employees receive? As always, contact us with any questions.