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UltraLink - FOCUS...on benefits
November 2005
Some CEOs Understand the Strategic Benefits of Supporting Healthy Employees
As the costs of supplying healthcare to employees continually increases, corporations need to start looking at cost-saving solutions from the executive level. Creating healthy employees and supporting healthy lifestyles can have long-term affects on a business but right now only a few CEOs are spearheading corporate sponsored wellness programs.
Partnership for Prevention, a national not-for-profit organization, has created a CEO roundtable made up of those executives who are leading the charge in making employees' health a corporate priority. While ultimately it makes smart business sense, these CEOs see that their workforce is their most important resource and understand that keeping employees healthy has many positive consequences. Those include financial benefits as well as those ancillary ones that most of us think of - higher retention rates, increased productivity, and increased employee morale.
From smoking cessation programs to preventative and chronic condition management programs, the CEOs from The Dow Chemical Co., Pitney Bowes, and Pfizer have a more enlightened approach. As Chairman and CEO Hank McKinnell, Jr., Ph.D, Pfizer Inc. stated, "Employee health should be an investment in people to be maximized, rather than a cost center to be minimized." They recognize that by proactively managing the cost drivers of healthcare delivery equates to bottom-line savings.
Source: HealthLeaders, October 1st, 2005
Can Premium Increases Possibly Be Slowing?
According to Milliman, results of their 14th annual survey of HMOs and PPOs indicate that premium increases may indeed be slowing. 2005 HMO premiums increased 8%, which is the lowest increase in five years. PPO premiums for a standard benefit plan also had the same increase of 8%, while premiums for high deductible PPO plans increased 1% from 2004 to 2005.
Although the increase for high deductible plans is small, take caution when looking at that number. "In particular, we expect the increase for high deductible plan premiums to be at least as great as the increase for low deductible plan premiums, all else being equal. The small increase in high deductible PPO prices in 2005 may help fuel employer interest in shifting to a high deductible PPO product with an integrated employee account," says Steve Cigich, author of the survey.
Looking out to 2006, the projected increases are coming in higher. HMOs anticipate an increase of 10 to 12% while PPOs anticipate a premium increase of 12 to 13%.
The survey was sent to the nation's HMOs and fully insured PPOs that serve the commercial large- or mid-group employer markets. What makes this survey unique is that it removes three important factors that can skew the results of a typical survey: differences in benefit design scope, cost sharing levels and member demographics. Complete results are available at: Milliman
Source: Milliman Press Release, October 24th 2005
Increasing Numbers of American Workers Contribute to Healthcare Premiums
According to a Benefits USA survey recently completed by Compdata Surveys, Eighty-eight percent of American workers contribute to their healthcare premiums. The majority of the premium contributions fall into the range of 11-30% with 34% contributing 11-20% and 28% paying 21-30% of the premiums for employee only coverage.
With the ever increasing rise in benefits costs, both small and large employers are asking their employees to take on more and more of the cost burden. The number of employers covering 100% of the benefits premium has been decreasing over the last several years. Currently only 11.6% of organizations are doing so.
This was a survey of more than 5,000 employer sponsored benefits plans covering more than 5.5 million American workers. The survey collected data benefits offered by companies across all industries and reports the prevalence and costs of such plans. Complete results can be found at: Compdata Surverys
Source: Compdata Surveys Press Release, October 17th, 2005
New Law on Infertility Treatment in Connecticut Enacted
Connecticut is the 15th state to enact a law requiring insurers to covers some type of infertility treatment. Although this is not the first state to enact this law, what is unique to Connecticut is that it denies these benefits to women older than 40. Only a few states have age cut offs, but those have set a higher limit - New York has a cut off age of 44 while New Jersey ends coverage at age 46.
The Director of Government Relations for RESOLVE: The National Infertility Association, Julie Salz-Greenstein said, "We'd rather that be left up to the patient and their physician."
It turns out that the age cut off was a compromise on a controversial bill. Insurance companies argue that expecting them to cover this very expensive treatment will only contribute to the rising costs of healthcare. One round of in vitro fertilization can cost approximately $12,000 and often couples have to go through multiple rounds before getting pregnant.
RESOLVE plans on lobbying Connecticut lawmakers to at least increase the age limit when they reconvene in February.
Source: USA Today, October 14th, 2005
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