Rising health care costs are putting more and more pressure on employers every year. Providing a desirable plan has become an enormous expense, but companies still need to offer health insurance benefits to stay competitive and recruit.
“Health insurance is no longer an employee benefit; it’s a cost of doing business,” says Albert Ertel, COO of Alliant Health Plans. “You have employers trying to find a balance between what they can afford and what the employees desire.”
Smart Business learned more from Ertel about how employers can find that balance.
What options do they have to keep the costs manageable while also offering a quality benefits program?
One of the mistakes employers make is looking at their health plans on a year-to-year basis instead of using a long-term, multi-year approach. There used to be 10 to 15 insurance companies employers could get quotes from that would compete for their business. There are only a handful of competitors in the business now, and options tend to be homogenous. Companies don’t look at the true cost of changing carriers.
What should employers look for in a health insurance carrier?
They should look at the price point and the availability of services. One universal truth is that health care is local. Looking at the provider directory may not provide solutions. Look for a company that wants to work with you over the long haul. This opens the door to develop that multi-year or long-term approach. Too many people just say, ‘Here’s the low rate this year; it’s time to move.’ Disruption adds to the cost of changing carriers. Once you change carriers four or five times, you’ve gone full circle and not accomplished anything positive for your employees.
In the real estate market everyone looks at location, location, location. In the health insurance business, people have a tendency to be very short-sighted and look at rate, rate and rate. Health insurance is a product for which you truly get what you pay.
Besides price, what should employers consider when looking at health insurance?
The basics are the price, the benefits and the network that employers have a tendency to focus on. After those three factors, you should consider the true level of customer service, level of employee education, hands-on service and no-cost, value-added services guiding people to healthier decisions. If you only compare the basics, you’ll have a tough time differentiating one carrier from another. Although employees aren’t involved in the decision of where to buy coverage, every employer out there knows that a benefit is no longer a benefit if it’s a ‘hassle.’ I’m talking about picking up a telephone and talking to a person. You need a focused point of contact — those touch points that are truly hands-on, truly person-to-person.
Employers want to do the right thing for their employees. But the amount of information most employees know about their health insurance is printed on their ID card. That’s about as in-depth as they go until they need it.
