It’s a common story: employers pay into what looks like a reasonable benefits package, only to end up with high claims costs for employees. Employers and their employees are stuck with rising premiums, little to no wellness resources and this cycle repeats itself year after year.
But businesses aren’t stuck with this option forever. Self-funded insurance is on the rise, and many employers are turning to this option for the cost-savings benefits.
Going self-funded enables employers to tailor health plans and resources to their employees, resulting in lower claims costs and healthier people. A health plan management approach to self-funded benefits can arm employers with more than just fair pricing — it can unlock critical insights around how their employees are (or aren’t) using their benefits, the quality of care they’re receiving and more.
By taking a deeper look at what is impacting employee wellbeing, employers can learn about the why behind claims costs and design strategies to help lower, or prevent, some claims before they even happen.
Here are a few things employers should consider when evaluating costs and plan design.
Are your employees connected with their benefits?
Many employees aren’t engaged with their benefits because they don’t understand them or have the resources to stay informed. In fact, 62% of employees said that their employer doesn’t serve as a resource for their healthcare questions.
A lack of connection to health and benefits resources can be a huge contributor to low health literacy (which over 80% of Americans suffer from today), higher rates of ER visits, extended hospital stays and generally poor health. A hefty price to pay for the poorly informed.
However, self-funded employers are in a position to help solve some of these challenges and reconnect their employees with critical wellness resources. The healthcare industry today is a bit behind the tech times, but that doesn’t mean employees need to suffer from connection issues.
Employers can (and should) tap into their workforce demographic data to understand what their employees need to engage with (and access) their benefits. Critical insights to look into include:
-
Types of technology employees will actually use
-
Tools and resources employees have difficulty finding or understanding
-
Top health issues impacting the workforce
-
Which tools and resources are underutilized (or not being used at all) and why
What percentage of claims are preventable?
Though not all claims are preventable (hello, slippery sidewalk), many can often be addressed or mitigated far before people need to go to the doctor. We’re talking about employees who come to work sick, didn’t get their flu shot, are struggling to quit smoking and more.
Having preventative resources available is critical to connecting employees with their health, but those resources are only effective if they are accessible. Employees who aren’t taking advantage of health and wellness resources (either because they don’t know they exist or the resources simply aren’t useful) can lead to increased claims costs, large and small.
But this is preventable. Partner with a medical management team or a TPA to help create and deliver educational and accessible resources such as:
-
In-office flu shots
-
Biometric screenings
-
Smoking cessation programs
-
Education around when to use a telemedicine app over urgent care or the ER
-
Information on high quality, in-network doctors or hospitals
How does the quality of care employees receive measure up?
The quality of healthcare can be a sneaky contributor to increased claims costs. Some of the most inflated costs in healthcare today are surgical costs, yet high costs don’t always mean high quality. However, defining “good care” can be a bit tricky.
Tapping deeper into data and insights about healthcare providers, like hospital and physician grades and claims data, can help employers paint a clearer picture of the quality of care their employees are receiving and how it measures up to the cost.
Self-funded employers should look at quality metrics, such as the following, when determining plan design:
-
Rates of surgical complications and infections
-
Re-admittance for non-chronic conditions
-
Rates of C-sections recommended over natural birth
-
Rates of surgical recommendations for issues that could potentially be treated with lower cost, lower risk outpatient therapies
-
Hospital mortality rates
When self-funded employers are armed with better data, they can play a critical role in deflating the cost of healthcare, controlling claims spend and making benefits beneficial for their employees.
