Health care costs and health insurance premiums are continuing to rise at alarming rates. And, unfortunately, this is not a new phenomenon, as employers have been struggling with unpredictable and uncontrollable rate increases year after year.
Annual double-digit premium increases have forced many employers to pass significant costs on to employees, in the form of higher contribution, deductible, coinsurance and/or co-pay amounts. Most employers still take the responsibility of providing quality benefits seriously, but employees need to be involved more than ever before; they need to think carefully about how they use their benefits and become smarter consumers.
“The way we purchase health care is unlike any other purchases we make,” says Amy Broadbent, the vice president of JRG Advisors, the management company for ChamberChoice. “Most of us will search a newspaper for a coupon that saves us pennies at the supermarket. But when it comes to health care — something far more expensive and complex — we rarely ask enough questions or consider all of the options that could save us money.”
Smart Business spoke with Broadbent about health care and how to help employees become better health care shoppers.
Why is it so important for employees to understand health care?
Many employees do not understand the role they play in managing health care costs and do not spend health care dollars wisely. How many employees actually realize that each time they go to a medical provider or receive medical services they generate a claim that must be paid for through their employer-sponsored medical plan? The costs of their claims, their family members’ claims and fellow employees’ claims determine, at least to some extent, the price their employers pay for health benefits. In the end, employees’ decisions directly affect annual premium adjustments. It is time for employees to begin making more conscientious health care decisions. The more knowledge employees have about their personal health and the treatments they receive, the more they can control their out-of-pocket costs and, ultimately, the employer’s costs.
How can employers educate employees to become better health care consumers?
When someone is sick or injured, he or she wants to feel better, fast. Most health plans provide coverage for treatment that can be received in a variety of settings: a doctor’s office, a hospital, an urgent care center or an emergency room. But, every setting is not appropriate for every kind of care, and, too often, we utilize the quickest means available rather than the most cost-effective. For many, the decision is based on convenience rather than cost. Educating employees to choose the most cost-effective option would go a long way toward ensuring that an employer can continue to provide quality benefits.
How can employees involve their medical professionals?
You and your employees should take the time to talk with your doctors. Surprisingly, many patients do not ask their doctors basic questions about treatment options and alternatives. Patients often accept their doctor’s advice without taking the time to question treatment alternatives. Having a dialogue with the physician helps the patient better understand how their care and treatment decisions affect their health plan costs. This will also enable the doctor to get to know the patient better and, ultimately, prescribe the most effective treatment possible. Taking the time to ask basic questions will enable the patient to become a more educated consumer. Ask questions like: How much will my treatment cost? Can I be treated another way that is equally effective but less expensive? What are the potential side effects? What are the risks? The intent is not to forego care but to receive the most appropriate level of care at the most reasonable cost available.
How can employees become better educated on their prescription medications?
Learn the prescription facts. Many people incorrectly think there are significant differences between brand-name and generic drugs when, in fact, there are not. The true difference lies in the name of the drug and the cost. It is no secret that generic drugs cost less than brand-name drugs. Employees should be encouraged to ask their doctor if a generic equivalent is available any time they are given a prescription. Not only does this save the employee money but the use of generic drugs also saves the employer money in terms of health plan utilization. The greater the overall use of generic prescriptions, the better the impact on the health plan utilization and, ultimately, health care rates.
What else can I, as the employer, do?
As an employer, you are undoubtedly trying to figure out how to prevent ever-increasing health care costs from having any more of a serious impact on your company. Health care costs will continue to rise and the reasons why are not within an employer’s control. Therefore, employers need to encourage employees to become better-educated consumers of health care services. Employers and employees are in this together. It is time for employees to understand just how much of an impact their health care choices and decisions make in the long run.
AMY BROADBENT is the vice president of JRG Advisors, the management company for ChamberChoice. Reach her at (412) 456-7250 or firstname.lastname@example.org.