The Society for Human Resource Management reported in 2017 that benefit costs as a whole for U.S. employers have increased 24 percent since 2001. A 2017 study by Willis Towers Watson concluded that employers can expect healthcare costs to rise by 5.5 percent in 2018, escalating from 4.6 percent in 2017. Regardless of the price hike of healthcare costs, employers remain positive about being able to provide health insurance in the future, with 92 percent expressing high confidence that they will keep sponsoring the benefit despite the costs in the next five years.
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This puts employers in the precarious position of delivering competitive healthcare coverage that doesn’t strain the company financially. Following are some ways to minimize group healthcare costs and to motivate employees to work for your organization.
Combine High-Deductible Health Plans with Health Savings Accounts
A report by the Washington Post indicated that employers are shifting toward high-deductible health plans (HDHPs) with around 90 percent stating that they will offer at least one HDHP in 2018.
HDHPs are one way for employers to save on healthcare costs because the higher the deductible, the lower the premium. Although HDHPs reduce employer premium costs, employees often eye them with skepticism because they require employees to pay for their healthcare costs out-of-pocket until the deductible (usually a sizable amount) is met. The coinsurance doesn’t kick in until the deductible is satisfied.
You can ease this burden on employees by pairing the HDHP with a health savings account (HSA). These accounts allow employees to save for medical expenses on a pretax basis, meaning that contributions are not subject to federal—and in most cases, state—taxes. Another alternative is to offer an HDHP plus an employer- and employee-funded HSA or a pre-funded HSA.
Educate Employees on Cost-Efficient Options
Employees likely will welcome any news that can help them save on healthcare costs. For example, let them know that it usually costs less to visit a physician during normal business hours than to go to the emergency room. If the issue isn’t an emergency, they should visit their doctor instead. For employees who travel frequently, exploring health insurance for nomads can ensure they have access to medical care wherever they are. Additionally, organizations can explore digital solutions like the best EMR for small practice to streamline healthcare management and improve cost efficiency, benefiting both employers and employees. Visual learning tools such as 3D anatomy platforms can further aid employee health literacy, enabling them to better understand their bodies and make informed decisions.
If you provide telehealth services, which typically are less expensive than emergency room and doctor visits, introduce your employees to the program and encourage them to use it when appropriate. Moreover, leveraging big data analytics in pharma can further help organizations analyze healthcare trends, predict potential issues, and optimize strategies to reduce costs while improving overall care. For example, many psychology clinics use data-driven insights to streamline patient scheduling and resource allocation, helping them manage psychology clinics efficiently while keeping expenses under control.
To offset these rising expenses, many companies are turning to insurance loss control strategies to identify risks and prevent costly claims. By proactively managing workplace hazards and improving safety protocols, businesses can reduce their overall insurance premiums while fostering a safer work.
Identify More Ways to Lower Healthcare Costs
Employers can lower healthcare costs in the following ways:
- Consider using narrow, or limited, networks that deliver top-performing physicians at affordable costs.
- Contract directly with providers that not only specialize in high-cost or high-risk procedures—such as transplants, back surgery, and joint replacements—but also offer bundled payment solutions.
- Carve out high-cost prescription coverage such as sublingual semaglutide by contracting directly with a pharmacy benefits vendor to administer your prescription program.
- To identify winning strategies to reduce healthcare costs, employers must be willing to work directly with vendors who understand the healthcare market, including how to survive its volatilities. Which tip will you use to reduce healthcare costs?
Employee Wellness Programs
At its core, an employee wellness program is a set of initiatives designed to improve health and well-being among employees, which can include mental health support, physical activities, nutritional advice, preventive health screenings, and recommendations for supplements like the best probiotics for women. These programs not only aim to boost the overall health of employees but also reduce healthcare costs, increase engagement, and enhance productivity. Incorporating a telemedicine app can also be a valuable tool in these programs, providing employees with easy access to healthcare professionals remotely, which further supports their well-being.
Implementation Tips:
- Partner with Healthcare Providers: Collaborate with healthcare professionals to conduct thorough health screenings and risk assessments, using tools like EMR software to keep everything organized and ensure no important details slip through the cracks.
Medical cost-saving initiatives can further benefit from accurate insights in patient care and treatment outcomes. Employers partnering with healthcare providers should consider leveraging the process to abstract medical records, which involves systematically extracting relevant information from patient charts to monitor metrics like compliance and service quality. Streamlined medical record abstraction supports data-driven decisions for health risk assessments and program adjustments, ultimately driving higher efficiency in employer-sponsored healthcare plans.
- Ensure Confidentiality: Make participation voluntary and ensure data privacy to build trust among employees.
- Use Data to Inform Decisions: Analyze the collected health data to identify common health issues and risks within your organization.
For emergency services and healthcare providers, leveraging specialized EMS reporting software can further streamline the collection, analysis, and reporting of patient care and operational data—ultimately improving clinical outcomes and optimizing cost management.
By focusing on comprehensive assessments, mental health, physical activity, nutrition, and continuous feedback, organizations can develop a supportive environment that fosters health and productivity.
