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Creative Solutions in Healthcare Cost Management

With the average annual health benefit payout in Wisconsin at $6,940 per employee and 18-25% annual increases in health insurance rates, it's not surprising that health insurance costs are at the top of the "concern list" for many Wisconsin manufacturers. The health insurance cost crisis is having a disturbing effect on the ability of companies to compete and remain profitable in today's marketplace. In a recent survey by the National Association of Manufacturers, respondents said that health care costs are the top "major threat to the future of U.S. manufacturing."

In today's economic uncertainty and competitive environment, boosting the bottom line is critical to long-term success. One way to do this is through health care cost management initiatives.

A ray of hope

In most employee populations, 10-15% of participants in the health plan create 80% of the expenses. Not surprisingly, these expenses impact your annual premium increases - and your annual increases impact your ability to provide good benefits for your employees.

Thankfully, due to a bit of unconventional thinking, there are a variety of efficient, inexpensive measures that can pull in the reins on runaway health care costs. One specific example is an integrated Health Care Demand Management Program, which utilizes education and intervention to drastically improve the illness and injury burden, health status, and the health care use behavior of the employee population.

The Demand Management Program helps control costs by teaching best practices in each of the following areas:

health plan design and incentives
medical self-care
consumer health education
injury prevention
disease and high-risk management

The goal of the program is to teach you and your employees how to minimize risk factors, improve overall health and utilize health care in the best, most cost-conscious ways.

Managing your health care costs

Wellness programs are implemented in hopes that employees will take the initiative to become healthier, but the Health Care Demand Management Program works much harder at targeting issues beyond wellness. The program combines education, health assessments, Biometrics screening, financial incentives and other tools and resources to create an overall program that offers significant benefits including:

Increased

profits
employee retention
productivity
understanding of how behaviors impact costs
incentive to use health insurance wisely

Decreased

doctor visits
healthcare cost increases
employee financial pressures
Other benefits include access to self-care, on-site educational programs and top-notch healthcare hotlines.

Finding a targeted customized health insurance package

To accomplish cost savings, manufacturers must work closely with insurance agents or brokers that are willing to present the full variety of creative insurance plans that are available today. Many insurance agents don't have the familiarity with new insurance plan designs, and their incentive to learn the new plans is minimized because the commissions they earn on such plans are significantly reduced compared to traditional plans. Employers need to be selective in the health insurance buying situation. Finding a neutral broker to help in the process can be key to developing an optimal insurance plan design for the employer and the employees.

Small changes for big gains

The good news is that this program doesn't ask you to hack away at benefits and alienate employees in order to stay profitable. A carefully designed health insurance plan integrated with a Health Care Demand Management Program can create the sense of control and relief that employers are looking for, while providing gold-standard care for employees. The combination is a win win solution for you and your team.

For the latest health plan design options, consumer education strategies and programs that provide access to the best care available at the lowest cost, contact Bob Carpenter, President, Corporate Health Concepts at (262) 945-4435. Or attend the Manufacturing Matters! Conference and take part in the Savings Strategies in Health Care Costs Workshop.

Copyright 2003 by WMEP.org

WMEP provides technical expertise and hands-on implementation assistance to small and midsize manufacturing firms on advanced manufacturing technologies and business practices includinglean manufacturing, ISO, value chain management, and strategic repositioning services for manufacturers and manufacturing facilities located in Wisconsin.

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