Designing the right health benefits plan
for your employees is a complex task.
There are many issues to consider, including tax and legal aspects, funding,
finding the insurance carrier and striking a
balance between your employees’ needs
and affordable benefits.
Smart Business spoke to Eugene Sun,
M.D., M.B.A., vice president of Medical
Affairs at HealthAmerica, about how
employers can choose a health benefits
program that works for their company.
How should an employer go about choosing
a health plan?
It’s a smart idea to look at all health plan
options available. Sometimes employers
stick with the same carrier year after year
for no reason other than it’s the one they’ve
always had. Changing insurers is well
worth the effort if you find a health plan
that offers strong service along with lower
costs at the same or better benefits.
Next, start with your employees and find
out what they want. It’s helpful to know up-front the types of benefits they think are
important, what coverage options to include, what co-pays will look like and so
on. Discuss these issues with your employees and, since you won’t be able to please
everybody, be sure to manage expectations
as well.
What is the best source for learning about
insurance products?
Many small businesses find it helpful to
work with an insurance agent or broker.
Most health carriers employ licensed,
knowledgeable marketing representatives
who can provide a full explanation of the
choices, benefit offerings and costs. They
can help answer questions such as:
- Is the insurance carrier licensed,
accredited, reputable and financially
secure? - How often are policies renewed?
- Is the plan easy to administer?
LI> Are claims processed and paid quickly?
- Does the insurer provide educational
and other communications materials to
employees? - Does the plan provide sufficient financial incentive to encourage employees to
select network providers?
What are the next steps for choosing a plan?
After you receive a price quote, it’s wise
to collect proposals from several insurers.
This should include information about
their customer services and claims-paying
abilities. When comparing health care
plans, consider such criteria as:
- How much will it cost the company on
a monthly basis? - Should you insure just for major medical expenses or for all medical expenses?
- Are there deductibles to pay before the
insurance starts to pay? - After the deductible, what costs are
covered by the plan? - How much more does it cost to see a
provider outside the plan?
What types of medical benefits should
employers consider offering?
A good rule of thumb is to offer employees the same benefits you would want for
you and your family. When gauging the
scope of coverage, consider the following:
- What doctors, hospitals and other
providers are part of the plan? - Are there enough of the kinds of doctors you would expect to have?
- Are the providers located conveniently
for your employees? - Does the plan require permission for
specialist referrals? - Are there limits to how much will be
covered by the plan? - Does the plan cover the expenses of
delivering a baby? - Does the plan cover prescription drugs?
- Does it cover drug and alcohol treatment, mental-health care, home health
care, hospice care, physical therapy and
experimental treatments?
How can you be sure if you’re dealing with a
reputable insurance carrier?
Employers have several resources available for evaluating the quality of a health
plan. Consumer surveys, like those published by U.S. News and World Report, are
based on standardized reports of patient
satisfaction. The National Committee of
Quality Assurance (NCQA), the nationally
recognized body for health plans, publishes a major survey called the Healthcare
Effectiveness Data and Information Set or
HEDIS. This comprehensive report standardizes data and measures how well
health plan providers are following clinical
guidelines for diseases such as asthma, diabetes, high cholesterol and heart disease.
Although HEDIS is not free to the public,
you can ask your carrier for their results.
In addition, the Pennsylvania Health Care
Cost Containment Council (PHC4) publishes an annual report, Measuring the
Quality of Pennsylvania’s Commercial
HMOs, comparing the quality and value of
Pennsylvania’s managed care plans. It is
helpful in evaluating the utilization, clinical
outcomes and member satisfaction among
health plans in the state. The report is available online at www.phc4.org.
EUGENE SUN, M.D., M.B.A., is vice president of Medical Affairs
at HealthAmerica. Reach him at [email protected] or (412) 553-7549.