As healthcare costs continue to rise, many employers are open and anxious to hear ways they might be able to save money while still providing comprehensive medical coverage to their employees. And luckily, many insurance companies have things in place that can do just that.
“While there is no silver bullet in negating health insurance annual increases, there are ways to minimize increases,” says Kevin Cavalier, vice president of sales at SummaCare, Inc. “Plan design is critical in lowering plan premiums, but employee engagement in understanding care options and being a better consumer of healthcare services is imperative. Employee engagement and education should also incorporate wellness initiatives to maximize plan effectiveness.”
There are ways to save money on your health insurance premiums, and your health insurer is on your side. It continually looks for ways to extend cost savings to you, and these savings often come by way of partnership discounts, higher-deductible plan designs, generic drug prescription riders, value-added services and wellness programs.
Smart Business spoke with Cavalier about ways your insurer can help you save on health insurance-related costs.
How can partnerships between your health insurer and a local chamber or consortium save you money on your health insurance premiums?
Choosing an insurer that offers health insurance premium discounts through a chamber or consortium is a great way to save money on the monthly costs associated with offering health insurance to your employees. Chamber members are offered extended discounts on things such as health insurance, office supplies, shipping and transporting, and energy costs because of existing relationships and agreements a chamber has with other companies.
By joining your local chamber, you can save thousands on services and costs you would otherwise have to pay for at full price.
Can staying with a carrier that offers predictable rate increases save you money?
If you have consistently offered health insurance benefits to your employees year after year, you are probably familiar with the annual rate increases that can accompany those benefits. And while some of these increases are unavoidable as medical costs continue to rise, there are ways to help you better anticipate higher costs. Staying with a carrier that offers predictable rate increases can help you better budget for your anticipated benefits spend while resting assured you are receiving the most value for your dollar.
If you’re thinking about switching carriers due to an extremely low rate, know that, more often than not, these low rates are unsustainable and you may experience an unexpectedly high increase in year two. Making minor benefit changes can often negate some of the difference in costs between two insurers and saves the time, effort and hassle of changing insurance carriers.
How can offering an HRA/HSA plan save both you and your employees money?
Offering a Health Reimbursement Arrangement (HRA) or Health Savings Account (HSA) in conjunction with a high-deductible plan is a great way to lower your premium costs while still offering your employees comprehensive benefits. An HRA essentially gives your employees the opportunity to use tax-free money (provided by you) to pay for qualified medical expenses. An HSA is a tax-free savings account that belongs to your employees, and they can use it to pay for their insurance deductible and out-of-pocket medical expenses. Both of these arrangements allow you to save money by offering a higher-deductible, lower-premium plan, and they will educate your employees on the costs associated with the services they receive.
Will offering a generic-based prescription plan also save on costs?
One of the best ways to save costs is to offer a generic-based prescription plan. A generic-based prescription drug plan promotes the use of less expensive, generic drugs by filling prescriptions with the generic alternative when available. With this type of prescription plan, a pharmacy will only fill a prescription with the brand name drug if there is not a generic alternative available and/or if the prescribing physician indicates that it must be dispensed as prescribed with the brand name drug.
In addition to the cost savings of prescriptions filled with generic drugs instead of brand name drugs, many Pharmacy Management programs promote the use of generic drugs by offering a 90-day supply at retail pharmacies or mail-order options for a very low copay. These conveniences and low-cost options have proven effective in steering people toward generics. In addition, it encourages people to have their prescriptions filled at network pharmacies using plan coverage, which, in turn, reduces costs.
Can a wellness program save you money?
Yes, implementing a simple wellness program is oftentimes the first step in helping to lower costs, though the financial benefit may not be immediate. Offering things such as smoking cessation, weight management counseling, preventive care incentive programs and onsite health and fitness classes can reap long-term benefits in relation to the health of your employees and the cost of providing health insurance to them. Talk to your insurer to find out what components of a wellness program would benefit your employers and company.
Regardless of what type of benefit plan you choose to offer your employees, it is critical to continually evaluate what plans and services are offered by your insurer to ensure you have chosen the best plan option while containing costs.
Kevin Cavalier is vice president of sales at SummaCare, Inc. Reach him at (330) 996-8650 or [email protected]
Insights Health Care is brought to you by SummaCare, Inc.