Father doesn’t always know best sometimes moms can be helpful, too.
Just ask Omar Soliman, co-founder and CEO, and Nick Friedman, co-founder and president, of College Hunks Hauling Junk.
Friedman and Soliman were college students looking for a summer job when they pitched to Soliman’s mom the idea of removing unwanted items from commercial and residential properties for a fee. That summer, the duo used her cargo van to implement their concept and made a nice chunk of change.
Upon his return to school, Soliman wrote a formal business plan and won first prize and $10,000 in the University of Miami’s 2004 Leigh Rothschild Entrepreneurship Competition. Even with that success, they didn’t pursue the venture right out of college. But, about six months into their corporate jobs, they decided that hauling junk would be more fun than sitting in a cubicle.
Today, what started as a summer job has, in four years, expanded to a business with more than a dozen locations in major metropolitan cities. And annual sales have increased 200 percent in each of the last two years. The goal going forward is to have 150 franchises in the next five years and become the largest employer of college students by 2010.
Even with all of their success, Friedman and Soliman haven’t forgotten their roots as college students. They are involved with College Bound, a charitable program established by CHHJ, where a portion of revenue from each job is donated to the program, which seeks to increase the opportunities for underprivileged youth to obtain a college degree.
How to reach: College Hunks Hauling Junk, (800) 586-5872 or www.1800junkusa.com
Lifetime Achievement Award
When Michael J. Ward took the reins at CSX Corporation Inc., it was a company struggling to find an identity. A series of mergers and acquisitions had created confusion about just what the company was and what it stood for.
But Ward knew that regardless of what line of work a company is in, if it didn’t focus on people and make customer service a top priority, it wouldn’t have a future. So he put his people skills to use and began repairing the railroad transportation company’s reputation for service by putting a strong focus on core values, such as “People make the difference,” “It starts with the customer,” and “Get the right results the right way.”
Ward honed his skill at building relationships as a rack boy at his father’s pool hall in Baltimore. He then sharpened his business acumen at Harvard Business School, and when he arrived at CSX in 1977, he was ready for the challenge.
Through the 1980s, he helped with merger integration activities and worked in sales and marketing to create the C&O Business Unit. In 1995, he moved up to the position of chief financial officer and began to put his mark on the leadership of CSX’s rail operations, specifically providing leadership on the integration of Conrail operations into CSX.
He took over as president of CSX Transportation in 2000 and became chairman and CEO of CSX Corp. in 2003. His efforts to get employees to always strive for excellence have put the company in a strong position to weather the storm of the recent global recession.
Ward keeps his team members focused on driving productivity, creating efficiency and always putting CSX in a position to succeed by making sure they never lose sight of the customer.
How to reach: CSX Corporation Inc. (904) 359-3200 or www.csx.com
Michael K. Ferris had a problem.
Yet, instead of complaining about it, he decided to create a solution.
While working odd jobs and playing semi-pro football in his 20s, Ferris, founder, president and CEO of Valet Waste, bounced from apartment complex to complex during the 1990s. That meant that he spent a lot of time taking his garbage down three flights of stairs and across the complex to the trash compactors.
In 1995, he decided to start a service for the residents in his complex in which he would haul their trash to the compactor and save them the inconvenience. Ferris got 90 percent of the residents on board and began picking up trash five nights a week in large cloth bags.
Over the next six years, Ferris spent many late nights hauling trash and trying to figure out a better way to build his business. That’s when he discovered that multifamily housing unit residents desired amenities and convenience, while property owners wanted ways to keep residents satisfied and increase occupancy.
Ferris sold his idea to property owners by explaining that his service would not only satisfy residents’ need for convenience but would also keep the grounds clean, resulting in a better image for the complex. He also gave management a way to earn ancillary income by charging residents for the services provided by Ferris’ company.
Success ensued, and a private equity firm purchased the company in 2006, allowing Ferris to rapidly expand his concept across the country. Valet Waste’s revenue has increased by 200 percent since 2006, and total assets have increased by more than 1,000 percent.
The company has also expanded into 18 states, serving more than 200,000 units.
How to reach: Valet Waste, (877) 574-2587 or www.valetwaste.com
Retail and Consumer Products
What Jim Mellody started as a sandwich shop near Brandon in 1985 is now Beef ‘O’ Brady’s, a restaurant chain with locations around the country.
Several years later, in 1998, Gene Knippers and Chuck Winship approached Mellody with an interest in expanding the brand through franchising and founded Family Sports Concepts Inc. to become the parent company of Beef ‘O’ Brady’s.
It’s fair to say the franchising idea worked. With the addition of president Nick Vojnovic to the team of Knippers, chairman, and Winship, CEO, the chain expanded from 30 to 270 locations in 11 years.
While they expanded the brand through hard work, the growth can also be attributed to the company’s focus on families as the target customer. Because of that focus, franchisees go through a screening process that requires franchisee involvement in local schools, churches and sports teams to keep the franchise family oriented.
Even in a tough economy, Beef’s is continuing to grow. The goal for 2009 is to add 30 locations; as of April, it has already added nine locations this year.
Part of this growth can be attributed to the company pursuing franchise locations in nontraditional spaces with lower conversion and development costs. This includes the student center at the University of South Florida and hotels.
How to reach: Family Sports Concepts Inc./Beef ‘O’ Brady’s, (800) 728-8878 or www.beefobradys.com
Real Estate and Construction
Charles C. Appleby has never believed in the idea of seeking more power.
Instead, one of the keys to his business model is the belief that decentralizing operations empowers the people who make operating decisions and gives them the chance to reach their full potential and act as entrepreneurs.
It is with this style that Appleby, now chairman and CEO, has led Advanced Disposal Services Inc. By having a decentralized local business model, decisions can be made at each location based on current market conditions, allowing him to respond to opportunities as they arise.
Appleby joined Advanced Disposal in 1996 when his private investment company acquired the small waste disposal business.
By 2000, he was president of Advanced Disposal and was going to road shows in hopes of raising capital and was also working with the company’s banks to convince them to not call on its debt until it had secured more capital.
It was during this time, in 2002, when Appleby was stricken with colon cancer. This hardly slowed him down, however, and he continued working the phones and raising the capital he needed while undergoing chemotherapy.
Appleby has always been proactive in facing challenges such as finding other methods of disposing of waste. In addition to waste, Advanced Disposal collects, processes and disposes of recyclables and is exploring technologies such as the mining of landfill gas.
While the waste business is considered a dirty business, Appleby is proud to be one of the leaders in making the waste industry one of the leading promoters of environmental protection and safety.
How to reach: Advanced Disposal Services Inc., (904) 737-7900 or www.advanceddisposal.com
Advanced Disposal Services Inc.
As the national economy continues to try to recover, business owners are searching for a way to cut the cost of providing adequate health care without pricing the goods and services out of their employees’ reach.
“I think that having fair and equitable access to health care and health care insurance is right in our DNA,” says Ed Hannum, president and chief operating officer of AvMed Health Plans. “It’s what we’re all about as a country.”
Smart Business spoke to Hannum about health care reform and how it could help keep medical costs in check.
Where does the health care insurance industry stand on health care reform?
Clearly the high number of uninsured people is a huge challenge in this country. Discriminating against people because of their health status, age or gender is something that needs to be eliminated. And the health care industry wants as many people as possible in the insurance pool because, by having people participate, you get a normalized distribution of risk.
The pillars of reasonable health care reform should improve what we have now. You have 170 million people insured through group health insurance and about 46 million people who are uninsured. We need to improve access to Medicaid and children’s health insurance plans. The people who are falling through the cracks are working people who can’t get access to state and federal governmental programs.
So how do we help small businesses cover more employees? We need to make for a fair and transparent marketplace. The industry continues to work with legislators, President Obama and his administration to craft good, solid health care reform. There’s a tremendous amount of insights — how to get waste out of the system, how to become more efficient, and how to ensure that there’s good quality and good access.
What are the key components of reform?
We see 5 or 6 percent of our membership driving 55 or 60 percent of the cost; it’s an amazing inverse relationship. One of the things that we should be looking at is how to keep people well, to make sure that kids get immunization or that adults get their screening exams on a regular basis. Because if you have an issue and you pick it up early, you’ll improve the probability of getting it corrected. Not to mention that the Centers for Disease Control and Prevention estimate that eliminating a poor diet, inactivity and tobacco use would prevent 80 percent of the heart disease and type 2 diabetes and 40 percent of cancer.
Another part of the reform movement would be determining how employers can better educate their employees to be more accountable for their health. We’ve got to encourage employers to step up and put these types of programs in place in partnership with the industry. By getting consumers more involved through deductibles and co-insurance, they are going to be more conscientious about using the health care system in the appropriate manner, such as using an urgent care center as opposed to an emergency room. Health care has been one of the last sectors of the economy where the traditional laws of supply and demand and informed consumers don’t exist.
Ideas such as best practices and evidence-based medicine have shown to be highly effective and should be practiced consistently. I think the government in general is very interested in making sure that people get good care in the proper place and at the right time.
Administrative costs can be approached by getting rid of billing inefficiency and choosing a common language. We’ve all been through this. You go to the doctor, you answer a bunch of questions, you get treated. Two months later you go to another doctor and you’re answering all the same questions. There’s no communication link, there’s no personal health record, there’s no portability to get information. And then, oftentimes what you end up having are doctors doing the same tests. Those tests should have utility across the boards.
Our industry needs to make sure we don’t lose sight of medical innovation and creativity in the way that we practice medicine. We lead the world, frankly, in innovative medical practices and I would hope that wouldn’t get thrown out with the bathwater with any sort of reform movement.
What is the public health plan and what are some of its pros and cons?
There’s not a great deal of specificity in it. The industry is deeply concerned that if the government plan is introduced, looking at the way the government has operated Medicare in the past, if they start to get significant share and scale in the private sector, they’re going to cut back on rates of reimbursement to hospitals and physicians. The hospitals and physicians will seek to make that deficit up through the health care insurance industry, which, in turn, would give the government even more of a competitive advantage in that they’ll be able to charge a lot less. Yet, what’s truly happening is that the other members in the private sector are subsidizing the government.
Beyond that I’m not sure that the government would have the ability to ensure that there’s quality health care and appropriate management. When you connect all the dots of the various players involved, it becomes quite tedious to juggle that and ensure a good outcome; we really don’t have a health care system. We have a fragmented collection of different pieces but certainly it’s not what anybody would call a system. In a practical way I’m not so sure that if we did evolve to a single parent system that people in this country would embrace that.
If you are toiling over what to do about training, you’re not alone.
Tuition reimbursement and continuing education look good on paper and are great recruitment and retention tools, but, as businesses are finding out, in today’s economy, those types of programs could also look more like a dispensable employee perk than a business necessity.
While academics will tell you it’s a mistake to cut training from the budget, those closest to financial reality will suggest trimming the fat and adopting a leaner training strategy that ties education to the company’s immediate needs. For most businesses, this means doing away with the nice-to-have training and focusing on the must-haves that affect the bottom line today.
“Most companies aren’t following my advice because they haven’t asked me,” says Vincent S. Daniels, executive director, executive education, H. Wayne Huizenga School of Business and Entrepreneurship, Nova Southeastern University. “Companies are cutting back and not necessarily consulting with anyone before they do it. Businesses that had training up to three times a month have gone down to almost zero. Businesses often don’t understand that when you’re putting money into an employee, you’re making an investment in the company. Those that keep education going through the down economy will get the market advantage when the economy comes back.”
Keep in mind that the usefulness of what is learned today doesn’t last as long as it once did. Technology’s rapid evolution makes knowledge obsolete when it isn’t built on. Still, the average number of formal training hours has dropped from 25 hours per learner in 2007 to 17.2 hours in 2008, according to Bersin & Associates’ 2009 Corporate Learning Factbook. The report reflects an 11 percent reduction in corporate training spending and claims a trend shift in the types of education that businesses are pursuing.
Training that educates employees on ways to increase revenue or decrease expenses or that improves relationships with customers is a business necessity and has a place in your training regimen.
Determine what your company needs to work on and what areas you need to continue to grow in as well as the basics to keep up with the competition.
“What we are seeing now is a strong uptick in fundamental training that leads to specific certifications, while employer-funded MBA programs are decreasing,” Daniels says. “There isn’t one answer for all companies, but I can say that if you paid for this type of degree in the past and you stop, the employees close to getting their degrees will lose motivation.”
Considering who will be receiving the training is an important step. Being wise about your budget means training those who are in a position to benefit the company most instead of offering a la carte training to whoever is willing to trade a few hours of work for classroom duty.
“You may initiate a higher hurdle to earn the benefit of tuition reimbursement and other training, but you need to keep it for your business’s benefit,” says Barbara E. Kahn, dean, University of Miami School of Business Administration. “Investing in shorter, more customized programs gives more value when you are worrying about every education dollar. These types of programs give you training that is right to your needs.”
Considering the type of education you need has equal importance to the way the education is delivered. While some companies find online courses give employers the best return on investment while saving on travel and driving time, others find in-house courses or a classroom setting to be the best delivery method for employees.
Choosing a trainer
Your company’s goals help determine what institution you’ll use to provide employee training. Look at local colleges and universities first, as these organizations have flexibility in training formats and delivery.
Universities are often willing to consult with businesses to determine what the immediate training needs are. Community colleges, business schools and specific work force training centers can also provide tailored programs as opposed to off-the-shelf training that serves as a one-size-fits-all education.
“Colleges are willing to spend a lot of time with businesses to develop a program tailored to their needs,” Kahn says. “Universities can create programs that last just one week or longer depending on what is necessary to meet the business’s needs. The colleges willing to diversify what they offer are the ones that will keep their programs going in a down economy — and businesses should seek out those academics.”
Don’t think of continued education as a perk to employees, but think of it as a way to keep the business growing.
A common error employers make is accepting a program where the employee misses a significant amount of work to go to school. Options exist that allow you to dictate within reason, how, when and where your employees are educated.
“Training via community colleges that are attuned to local work force needs can be the most cost-efficient decision companies make,” says Eduardo J. Padrón, president, Miami Dade College. “If you identify and prioritize your needs in relation to the company’s growth, you can collaborate with a local partner to establish a program that will be long-standing and efficient.”
After you select a program and a university, your strategy must carry over into measuring tactics. Make sure you have a way to calculate the benefits of training and the reason you have selected the specific program.
Before an employee begins training, testing the skills that will be built upon is important. Testing will help determine where the employees’ skills are today and where they need to be after training. Making sure the employee, trainer and you are on the same page with expectations will help eliminate any miscommunication about future performance expectations.
“You can’t put your finger on the return on investment immediately with education,” Daniels says. “It’s not as tangible as an investment in a new computer. If it’s functional education, such as finance or marketing, you may be able to see a direct result sooner, and therefore have the ability to show their value easily. The return on soft skill programs aren’t as easily shown, but over the long term, [they] are just as valuable or perhaps more valuable. You should be continuing training with upper-level management, training for new management, functional areas of business and certification programs.”
Prior to training, discuss the reason for the education and the way the training will be measured with the employee. Tell the employee how the new knowledge directly impacts his or her daily responsibilities. Managers should tie the training into performance evaluations to determine its true impact on the enhanced ability to perform.
Even after trimming the education budget, some companies say the cost is too much to handle right now. If you still believe in education, but can’t afford it, reassess it in nine months. In the meantime, use in-house training and coaching capabilities.
“It’s critical to stand back, reassess overall operations and think strategically,” Padrón says. “You cannot afford to be lulled into thinking that good or bad times will persist forever. The world is moving too quickly to set aside training needs. The use of technology alone demands c ontinuing education attention.”
Bayfront Medical Center
701 6th St. S.
St. Petersburg, FL 33701
Sue G. Brody, President and CEO
About Bayfront Medical Center has grown to one of the area’s leading providers in trauma care. More specifically, Bayfront is home to the only trauma center in Pinellas County and its Bayflite medical emergency helicopter fleet serves the surrounding 15-county region. Besides trauma, the hospital has positioned itself to serve in areas of rehabilitation, women’s and infant care, and cancer care.
Year founded 1906
Key services Level-two trauma center, cancer center, level-three perinatal center, level-two nursery for high-risk obstetrics
Bay Pines VA Medical Center
10000 Bay Pines Blvd.
Bay Pines, FL 33744
Wallace M. Hopkins, Director
About In 2007, Bay Pines VA Medical Center received full accreditation from the Joint Commission in long-term care, home care and mental health programs. The hospital’s specialty services include chronic wound care, cardiology, psychiatry and substance abuse. Bay Pines VA Medical Center’s services are available to more than 94,000 veterans in a 10 county area in west central Florida.
Year founded 1933
Key services Chronic wound care, cardiology, surgery, intensive care units, psychiatry
Largo Medical Center
201 14th St. S.
Largo, FL 33770
Richard Satcher, President and CEO
About Largo Medical Center has repeatedly been named to the list of the Top 100 Hospitals by USA Today for overall care. The designation comes from the hospital’s services in cardiovascular, orthopedic, stroke care and intensive care. Largo Medical Center also is one of the newest hospitals in the area, being built in 1978, and the only one with all private patient rooms.
Year founded 1978
Key services Heart center, orthopedic pavilion, cancer center, spine care center, diabetes center
Morton Plant Hospital
300 Pinellas St.
Clearwater, FL 33756
Hal Ziecheck, Chief operating officer
About Since opening in 1916 as the first hospital in northern Pinellas County, Morton Plant Hospital has become a provider of highly technical and specialized care to more than 50,000 patients annually. The hospital gets its name from billionaire Morton Freeman Plant who helped found the hospital.
Year founded 1916
Key services Cardiology, cancer, women’s services, orthopedics/neuroscience, behavioral health
St. Anthony’s Hospital
1200 Seventh Ave. N.
St. Petersburg, FL 33705
William G. Ulbricht, President
About St. Anthony’s Health Care has positioned itself to become a specialty hospital in three areas. Recent additions to the hospital include a center for robotic surgery, the Minimally Invasive Skull Base Institute and a breast center. St. Anthony’s also is home to the only adult inpatient psychiatric facility in Tampa Bay. Founded in 1931, it’s one of the nine BayCare Health System hospitals.
Year founded 1931
Key services Cancer care, cardiovascular services, emergency services, stroke, surgery
St. Joseph’s Hospital
3001 W. Dr. M.L. King Jr. Blvd.
Tampa, FL 33607
Isaac Mallah, President and CEO
About St. Joseph’s Hospital is the largest among BayCare Health System’s nine hospitals in the Tampa Bay region. Since its founding in 1934, St. Joseph’s has become an advanced institution in medical technology and surgery. Its Centers of Excellence include the Advanced Center for Atrial Fibrillation as well as the cancer, neuroscience and heart institutes.
Year founded 1934
Key services Cancer, neuroscience and heart centers
Tampa General Hospital
1 Tampa General Circle
Tampa, FL 33606
Ronald A. Hytoff, President and CEO
About As the primary teaching hospital for the University of South Florida College of Medicine, Tampa General Hospital has become a leading provider of multiple medical services in the region. The hospital has the region’s only level-one trauma center and regional burn center, and it is one of the busiest solid organ transplant centers in the country.
Year founded 1927
Key services Level-one trauma center, regional burn center, solid organ transplant center, inpatient rehabilitation center
University Community Hospital — Medical Center
3100 E. Fletcher Ave.
Tampa, FL 33613
Larry Archbell, CEO
About Started by a group of Tampa businessmen in 1968, University Community Hospital has grown from a 208-bed facility to 431. The hospital is also the home of five Centers of Excellence, focusing on areas of major disease, cancer treatment, women’s health, pediatrics, diabetes management and orthopedics. University Community Hospital is one of four hospitals in the University Community Health system.
Year founded 1968
Key services Cancer care, diabetes treatment, orthopedics, pediatrics, women’s health
Organizations are hiring candidates from the deepest talent pool in history, and they’re expecting them to do extraordinary things right out of the gate. These new hires aren’t all young, either. Companies are mining talent from a large spread of generations, from pre-boomers to millennials.
So how does this generational collision impact business at today’s organizations?
“It can create tension, where one group may feel the other is almost holding them back and resisting change,” says Craig Johnson, vice president of academic affairs at Hillsborough Community College and a board director of Tampa Bay WorkForce Alliance. “But the more people work together, the more they understand each other.”
Smart Business spoke to Johnson about the challenges and opportunities presented by employing members of different generations and how co-mingling generations and fostering two-way mentoring relationships can advance corporate culture and bridge generation gaps.
How many generations can be represented in today’s organizations?
There are multiple generations in today’s workplace. It depends on how you want to define the generations. You have the pre-boomers, the baby boomers, Generation X and millennials. Some people are calling the latter half of the baby boomers ‘Generation Jones,’ a term that became popular during the most recent presidential election.
You can also define generations by differences in technology and pop culture. You have the baby boomers who were the original TV generation, the Gen-Xers who are the original computer and MTV generation, and then the millennials, who are seen as a gaming and iPod generation. But if you want to break it in half, you can say there are those who are the digital natives and those who aren’t.
What are the challenges and opportunities when integrating multiple generations?
Generation gaps do pose challenges in getting people to work together and understand one another, but they also present opportunities. There is a general feeling that the digital natives are a little more open to technological change. But, all of the generations have lived through or will live through incredible change, therefore, nobody is really the dominant party in terms of change. In fact, your more seasoned employees, baby boomers and the pre-boomers, are perhaps more experienced in dealing with change.
Therefore, while younger employees may be more open and more experienced with technology, the older generation, because they have dealt with more change, may actually be better at understanding the ramifications of change and analyzing what change may or may not bring.
How can companies avoid stereotypes and instead embrace and learn from generational differences?
Stereotyping and overly categorizing people give you a far too limited view. For instance, there’s that stereotype that the newer generation is more comfortable with technology. However, I think that innovative people, no matter from what generation, are just that: innovative. They’ll embrace whatever tools are out there and utilize them quite well. Some of the people who were first to jump into technology in the late 1970s and early 1980s are still innovative users of technology.
You have to deal with the individual and see what the individual really has to offer. And you have to create the opportunities for people to work with one another and to learn from one another.
What business functions should be integrated on a daily basis to avoid generation collisions and further bridge generational gaps?
When you’re creating committees and task forces, one of the considerations is trying to team up diverse groups of people from various generations. Then, they’ll have even more opportunities to learn from and share with each other.
It factors into hiring, as well. There’s this idea that everyone you hire is a member of a newer generation. That’s just not true in this day and age. You’re hiring people with various levels of experience who represent various generations. You have to find people who have the necessary soft skills, no matter which age group they represent. As long as you keep that approach up in your hiring processes, you’ll tend to find people who can work together, regardless of their generational differences.
What do companies gain by closing the generational gap through mentoring?
Mentoring is an effective way for any newer employee to learn about the institutional culture that exists within your organization. When newer employees come in, they sometimes have trouble understanding not only how you do things, but also why you do them. A mentoring relationship gives them the person to go to for answers to these questions.
But a healthy mentoring relationship is as good for the mentor as it is for the mentee. If you’re acting as a mentor, if you listen, you’ve got a chance to get a different perspective from the new person. A younger person with different life experiences is truly looking at your organization with a fresh set of eyes, and if the person can communicate that effectively, you’re going to learn a great deal. Plus, you may get ideas that you may be able to apply successfully to help your company. It can be a truly enlightening experience.
The more people work together, the more they understand one another, and the more these generational gaps close.
Craig Johnson is the vice president of academic affairs at Hillsborough Community College and a board director of Tampa Bay WorkForce Alliance. Reach him at (813) 253-7557 or firstname.lastname@example.org.
Revenue is down, the budget has been hacked away and now you’re edging toward reducing employee health care coverage — or even eliminating it outright. Before taking action, take into account the short-term benefits and long-term effects of your options.
A knee-jerk reaction may be to shift the benefit burden to employees. But those who have been down that road, say there are ways to take a strategic approach to generate value from a shrunken budget and employee pool. The most successful organizations over the long-term will be the ones that cut costs now, while improving the health of their employee populations.
Utilize existing resources to find out how you can save money, starting with your health insurance provider.
“Get engaged; understand how to use a health insurance and wellness plan together,” says Scott Evelyn, president and general manager of CIGNA HealthCare of Florida. “Put an aggressive carrot out there to boost employee compliance with having better health and understanding of their benefits.”
Awareness of the claims filed by your employees will allow you to determine the best health plan move that will work for their needs and devise a health promotion program that will be most appealing to them. While moving to a lower-cost plan may be a necessity, it is a temporary fix and should be complemented with an emphasis on health that will have a more lasting impact.
A 2009 Watson Wyatt report shows that 67 percent of employer respondents to an Annual National Business Group on Health survey say the top challenge to maintaining affordable benefits coverage is employees’ poor health habits. Only by managing these habits can you truly get your costs under control.
Work with your provider
Work with your health insurance provider to decide what the best options to your budget will be. Negotiating rates with insurers isn’t usually effective, as insurers aren’t offering massive discounts because of the economic downturn. The option you usually have is a different plan with reduced coverage.
One option is cost shifting to save the company money while increasing the cost to employees. But altering plans and shifting costs to employees isn’t solving the problem of high premiums. A Hewitt Associates LLC executives’ survey shows that participants found cost shifting didn’t bring out desired behavior changes in employees and that an emphasis on health at the workplace is needed.
Another money-saving health care option is risk sharing.
“Many health insurance plans can be designed to let the employer be in control of employees’ rates,” Evelyn says. “If the employee has better health, they get a better rate.”
A third option is a health savings account, which takes money out of an employee’s check pretax and the employer has the option of adding money to the account, as well. If the employee switches jobs, he or she will take this health savings plan to the new position and the employer will retract its contribution from the fund.
“Just like with auto insurance, if you change your health insurance deductible to be higher, you’ll get an instant reduction in your rate,” Evelyn says. “But if you don’t change your driving habits, you won’t reduce long-term costs — so you have to change your habits to get the best rates.”
While health promotion — or wellness — programs aren’t usually at the top of the list when contemplating short-term health insurance savings, a program will have positive results in the short term with the best outcomes in one to three years. Companies that effectively promote health see immediate savings in premiums of 10 to 13 percent with the potential of reducing future medical costs. The investment has a $3 to $6 payback on the dollar.
Your best bet to cut costs will be a two-prong approach. Change your health plan for instant budget relief and initiate a health promotion plan.
“Just about every health topic has a free Web site full of information,” says Ray Kendrick, chief human resources officer of Memorial Healthcare System. “Talk to your insurance provider to see what educational materials they can give you and what discounts are available when you initiate a wellness program.”
Design your health awareness plan with consideration of the number of employees that will be participating. A smaller company of 50 employees or less shouldn’t invest more than $25 per employee initially, but should focus on raising awareness by providing educational material that emphasizes preventive care, proper nutrition and health-related Web sites.
A midsized company of 300 or more employees should invest about $90 per person. Providing educational tools, focusing on the population’s main areas of concern and taking a competitive, fun approach is effective. A large company with a willingness to invest about $240 per employee can have a comprehensive program that includes education, financial incentives, the inclusion of spouses and perks like gym memberships.
Your insurance provider may have free online health risk assessment surveys. By surveying your employees you can determine ways to meet the company’s and employees’ financial needs. Ask questions about physical activity, stress management, tobacco use and general disease risk factors.
“Good primary care helps weed out bad outcomes down the road,” Kendrick says. “Bring to employees’ attention issues that are most common, like smoke cessation programs, and ask them what they’d like to see offered.”
Discussing what your insurance company provides to you at no cost or at reduced rates is a great first step. Many employers are unaware of fringe benefits included in their plans. If the insurance provider doesn’t offer what you need for free, it should be able to direct you to an organization or local hospital program that does.
After you’ve determined a health awareness focus for your employee population, you can create a plan of action.
“Everyone wants to start a wellness program and have it fixed in a month,” Kendrick says. “But it doesn’t work that way. You must consider what outcome you expect from insurance plan changes and wellness programs. If employees participate in wellness programs, the company benefits.”
You also need to make an assessment of your workplace wellness environment. Identify strengths and areas that need improvement. Enforce no smoking on the campus; provide healthy choices in vending machines and the cafeteria.
“Make sure employees know any private health information you get from them will be received in aggregate and you will not know their specific personal information,” Evelyn says. “You can also give them an incentive of money back toward their deductible if they report good health. This can also be done confidentially through the insurer.”
Provide health tips, programs, discounts to gyms and other information through multiple delivery sources. Some employees are more receptive to e-mails or newsletters — or they just need to hear the same message multiple times to get motivated into action.
“Insurers are aggressively working with employers to predict future claims,” Evelyn says. “Engaging in wellness will help those discussions and considering you need to convince only 5 percent of the population to make a financial difference, trying a wellness program is worth it.”