Health & Medical


Healthy returns



How to take the pain out of health care costs

By Carolyn LaWell


Smart Business Northern California | June 2009

Page 1 of 4


Dr. William B. Stewart, medical director of the Institute for Health & Healing, California Pacific Medical Center
Dr. William B. Stewart, medical director of the Institute for Health & Healing, California Pacific Medical Center

You’re looking at your expenses, and that health care cost is just glaring at you. If only you could chop that number.

In fact, many employers are. The economic downturn has caused 60 percent of employers to change their health plan or strategy, according to a National Business Group on Health/Watson Wyatt Worldwide study. With the median health care cost per employee estimated to reach $7,400 this year, many employers are transferring costs to their employees.

That may be an idea of your own or a route you’ve already taken. But insurance providers and health care experts are cautioning you to think twice if you want true savings and you want to hang on to your employee base.

“There’s a great temptation I think to short term save dollars, but long term, it’s not a good trade-off,” says David Joyner, senior vice president, large group and specialty benefits for Blue Shield of California. “In the long term, I think employers and employees will save money if we’re able to influence lifestyles because a tremendous amount of life care costs are linked ultimately to lifestyle and diseases that are connected to lifestyle choices other than genetics.”

More than 75 percent of employers’ health care costs and productivity losses are linked to employee lifestyle choices, according to the Centers for Disease Control and Prevention.

Cutting or renegotiating your health benefits can save money. But until you understand what’s driving your costs — your employees’ bad habits — you’re not going to reach the root of the problem. The bottom line is, the more your employees use their insurance, the more you’re paying.

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