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By: Peter Joseph
The cost of providing employees with health insurance coverage continues to increase at a double-digit rate. We’ve read a lot about cost drivers in health care – exorbitant hospital charges, rising prescription drug costs, expenses associated with developing new technologies and treatments, an aging population and litigation. Nurturing these factors is an environment in which the demand for health care seems to be increasing.
For the most part, there is little employers can do to control what is driving health care costs out of their reach. Health benefits companies can and do negotiate discounts, and while those help, the underlying costs continue to skyrocket. The increases created by these cost drivers flow through the health benefits companies and eventually trickle down to employers in the form of higher health insurance premiums.
In this soft economy, declining revenue is putting a squeeze on company expenses. It is likely that you will experience a 15 percent to 20 percent increase in your group health insurance when a renewal form lands on your desk.
Can you raise the cost of your company’s product or service as quickly as your health insurance premiums are increasing?
Probably not. However, there are steps you can take to gain some control over your health care costs.
Finding a solution
Employers can exercise some control over their costs by finding a health benefits company that provides the “best” value for their company’s premium dollars. The way in which you “shop” a health plan can impact the price. I’ll use an analogy. Your travel agent has a great deal for you – air, car, hotel and meals included. You tell your agent to book it.
Coincidently, your neighbors just booked that same trip for $ 1,000 less through their travel agent. One agent shopped for the best price, the other agent arranged the trip through his or her vendor of choice. Whether it’s a family vacation, buying a car or choosing a health benefits plan, how you shop can impact your cost. Make sure your insurance agent doesn’t “arrange” your health plan for you. How many providers are enough? The more participating providers a health plan has, the more you’re likely to pay in premiums. If you are considering a health plan that doesn’t include a few desired physicians, request that the carrier add them to its network.
Physicians participate in many different health plans and are usually willing to participate in one more. Don’t get caught in the trap of paying 10 percent to 15 percent more for your health insurance premiums because one or two doctors are notparticipating in the plan. It’s reasonable that an employee can find another physician out of the thousands on the plan.
The power of marketing
Living in the United States affords us exceptional opportunities and choices. Along with that privilege comes a barrage of communications designed to influence our decision-making. What we read in the papers, see on television, hear on the radio, see flashed across a billboard, get stuffed in our mailboxes or pops up on the Internet is designed to predispose us to a company or its product.
Marketing can be an effective tool, and depending on how much is spent, can be quite influential. What marketing cannot do, however, no matter how much is spent, is replace what it takes to come up with an affordable health benefits solution that works for you. Be sure to look for a health benefits company that is flexible, listens and is willing to roll up its sleeves to provide you with a package of health benefits that you can afford.
PETER JOSEPH is senior vice president for commercial sales for VISTA, a health benefits company headquartered in South Florida with more than 330,000 members. VISTA, through its affiliated companies, Vista Healthplan Inc., Vista Health Plan of South Florida Inc. and Vista Insurance Plan Inc., offers a choice of health benefit plans including health maintenance organization (HMO), preferred provider organization (PPO) and point-of-service (POS). Reach him through VISTA’s Web site at www.vistahealthplan.com or (954) 986-6255.
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