Health is Wealth: Employers get creative with health benefits to attract talent
Group health insurance is getting more commonplace – and more complicated – for northern Michigan employers.
According to Kim Boyer, who handles group health plans for Traverse City’s Ford Insurance, low unemployment rates and high competition for top talent have pushed some small businesses in the area to start offering group health insurance for the first time.
“With lots of competition for good employees, businesses are finding that they have to offer health insurance now,” Boyer said.
Health insurance – and benefits packages in general – have become the one of the prime means that employers use to compete for top-tier candidates. Jennifer Petterson, an employee benefits consultant for Advantage Benefits Group, says the competition has pushed employers into a balancing act. Companies work with Petterson and her team to strike a balance between compensation and benefits. Pay too little, she says, and candidates go elsewhere. But if the benefits package isn’t up to snuff, that can cost employers potential hires as well.
Because of this, Petterson says her clients want to know how their benefits compare to the local marketplace. To help them choose the right plan, she regularly provides businesses with benchmark information. “When I give them a benchmark, I try to say ‘Here’s where your deductible, your co-insurance, your co-payments, and your out-of-pocket expenses align with other similar-sized employers that are seeking employees out of the same talent pool,’” she said.
For example, the average deductible for group health plans in Traverse City hovers between $1,500 and $2,000 for individuals and around $4,000 for families. Employers typically foot about 80 percent of the bill, while employees pay 20 percent.
Boyer says employers are looking for good coverage at a reasonable cost. As the job market has shifted in favor of the job seeker, though, the definition of “good coverage” has started to change. Employees and job candidates are demanding more from their employer group plans, including lower deductibles and extra coverage features.
“What I’ve seen in the past few years is that employers are getting feedback from their employees, saying ‘This health insurance stinks. It doesn’t pay for anything. I have to pay for everything. I have a $6,000 deductible and I’m not going to the doctor when I’m sick because I can’t afford it,’” Boyer said.
Employers are responding to the feedback by retreating from high-deductible health savings account (HSA) plans and going back to more traditional co-pay plans with lower deductibles.
In addition, the current job market is forcing employers and health insurers to get more creative with the benefits they offer. When asked about how businesses can differentiate their health plans to attract talent, Petterson shared three innovative benefits that are becoming cornerstones of group health plans: virtual care, transparency tools and wellness offerings.
Insurance companies and employers are looking to decrease the frequency of high-expense claims, such as emergency room visits. Virtual care, Petterson says, is one of the best health plan benefits for accomplishing that goal. At night or on weekends, patients will sometimes go to the emergency room for help with relatively minor medical emergencies because they can’t get in to see their doctors for a day or two. Virtual care programs – such as MedNow, through Priority Health; or Amwell, through Blue Cross Blue Shield – link patients with physicians through an app. The doctors can ask questions, carry out video-chat assessments, and even call in prescriptions for non-opioid medications.
“Instead of going in for a $1,000 emergency visit, you have a $45 virtual visit with a provider,” Petterson said.
Transparency tools – meant to give patients more freedom to shop around for care options – are an increasingly common feature of health insurance plans. Petterson says that a patient in need of a procedure could login to a password-protected system through their healthcare provider and use that system to find places that offer that procedure in their local area. The online platform includes pricing details for the procedure at each location, so that patients can find and opt for the least expensive choice.
“Employees like it,” Petterson said. “They like having the ability to be consumers, and consumerism requires that there is transparency in the cost and quality of care. What do you do when you buy a car? You shop for price and you shop for quality. That’s never been in the world of healthcare until recently.”
Wellness programs have been a popular employee benefit for several years. Employees have options for fitness and exercise at work, or enjoy rewards for wellness activity participation. Employers benefit from having healthier teams, whether in the form of high office morale or lower rates of absenteeism. Insurance providers that offer group plans see lower claims utilization from the businesses that have healthier employees.
As a result, wellness programs have become a common consideration for employers trying to choose the right group plans for their businesses. Insurance providers often offer lower rates to businesses that are taking an active role in keeping their employees healthy.
Wellness is the positive side of the coin. On the flip side is the opioid crisis. In an effort to curb the rise of addiction and the resulting loss of life, health insurance providers are changing how they handle opioid prescriptions as part of their coverage.
According to Boyer, healthcare insurance providers are trying multiple tactics to fight the opioid crisis. For example, Blue Cross Blue Shield Michigan is sponsoring leftover drug disposal programs. Insurers are working to educate physicians on prescribing the right dosage. And providers have begun to cover non-opioid therapies – alternative treatments that maybe wouldn’t have been covered in the past.
Petterson notes that how insurance companies design their plans around opioids can have a domino effect, especially in the case of group health insurance. Opioid prescription policies for a single group plan can affect hundreds or thousands of people – including not just employees, but also their dependents.
In fact, Petterson says that insurance companies need to be on the “forefront” of the opioid crisis.
“The insurance companies really need to be on the forefront of this fight, because they can impact what the doctors can prescribe, and they can impact what the pharmacies can give,” Petterson said. “The employer is really at the mercy of their insurance partner on this issue.”