3 Questions Featured

8:00pm EDT May 26, 2009

Edwin W. Hannum is president and chief operating officer for AvMed Health Plans and has overall responsibility and accountability for providing leadership and executive oversight for the execution of AvMed’s strategies and operations. He is responsible for growth of the organization and ensuring its financial strength and operating efficiency. Since 1987, Hannum has held positions of executive director, vice president of marketing, group vice president service and senior vice president of marketing and sales.

Q. Do wellness programs have an effect on insurance costs to employers?

Yes. Effective wellness programs create more focused and engaged employees with reduced absenteeism. Your insurance company should be able to provide an estimate of savings with employee compliance with wellness efforts to better help you realize your goals. However, keep in mind, the ROI on these types of plans are typically estimated savings, and just like the base rates for employee health care coverage, it’s not like pushing an iPod across the counter and you know the exact cost.

Q. What can an employer expect from its insurance provider as far as negotiating rates?

There are many factors considered when an insurer provides a group rate to an employer. If you discuss what you want, the insurer will match you with a fitting group plan. Many companies are asking us for innovative ways to save on group health care benefits because of the down economy. There are a lot of different product options on the table now in part due to the demand because of the bad economy. You can shift costs to the employee through benefit designs, but the most successful way to reduce costs is to promote healthier living. You will never reduce costs long term or address the affordability of health care unless you have healthier employees and they are educated in using their health care coverage properly.

Q. What can employers do to promote healthier habits to their employees?

Give employees information and get them engaged in their own health and understand their own biovariability. We are not all homogenous and don’t have the same predisposition. Having a heath assessment will help outline some of the issues that can arise and prevent or prepare for their health conditions. This will prevent more costly issues down the road.