While lawmakers continue debate on reforming the nation’s health care system, businesses struggle to find solutions to rising costs and improving the health of their work force.
For answers, Smart Business turned to Barry Arbuckle, Ph.D., president and CEO of MemorialCare Health System and immediate past chair of California Hospital Association.
Where do you start?
Think lean. As employers face declining revenues, escalating costs and continual demand for increased value and quality, the decades-old lean approach first embraced by manufacturing is catching on in other sectors with impressive results (see November 2009 issue). Workshops and lean management philosophy create a sense of purpose, team problem-solving and long-term thinking by proactively engaging staff. Lean implementation helps to redesign companies from the ground up. In just one year with a ‘lean’ attitude, MemorialCare Medical Centers eliminated 123 unnecessary process steps, made 1,302 square feet available, and reduced distances traveled by staff to carry out their jobs by 730 miles. Return on investment reached $4 million and is anticipated to provide a return of more than $17 million in three years. Most importantly, we improved the care of our patients.
How can employers trim benefit costs?
While raising deductibles and premiums works in the short term, other approaches are available (see August 2009 issue). Rather than lose customers, payers may be willing to renegotiate rates. One way to lower premiums is by offering more than one health plan option with a fixed dollar contribution, no matter the plan selected. High-deductible health plans without co-pays for office visits or prescriptions generally have lower premiums than traditional plans. Consider offering raises for employees to purchase their own health coverage or join their spouse’s plan. MemorialCare experts can help identify cost reduction strategies through benefit audits that ensure you get the most competitive price and package.
How can we encourage employees to accept health coverage?
Millions of uninsured — especially young adults — decide against enrolling in their employers’ health coverage (October 2009 issue). Even though many can afford it, they believe their age offers protection from illness and injury. The culprit is usually lack of information — not knowing what to look for in a health plan, how to select coverage to best meet one’s needs, availability of short-term insurance to fill gaps between parental or school coverage and their new job and how joining a health plan saves money and keeps you healthy in the long run.