Kirsch Kohn & Bridge, LLP, Here Are Your Articles for Thursday, October 25, 2018
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Is This Your Situation: Worried About Rising Health Care Costs

 

Health care is one of the most popular benefits you can give your employees, which means employers are getting squeezed as the prices continue to rise. Indeed, the Society for Human Resource Management reported in 2017 that benefit costs as a whole for U.S. employers have increased 24 percent since 2001.

How can companies continue to maintain the benefits? Following are some ways to minimize group health care costs and to motivate employees to work for your organization.

  1. Combine High-Deductible Health Plans with Health Savings Accounts

HDHPs are one way for employers to save on health care costs, because the higher the deductible, the lower the premium. Although HDHPs reduce employer premium costs, they require employees to pay for their health care costs out of pocket until the deductible (usually a sizable amount) is met. The coinsurance doesn't kick in until the deductible is satisfied. You can ease this burden on employees by pairing the HDHP with a health savings account. Employees can save for medical expenses on a pretax basis. Another alternative is to offer an HDHP plus an employer- and employee-funded HSA or a prefunded HSA.

  1. Educate Employees on Cost-Efficient Options

Let them know that it usually costs less to visit a physician during normal business hours than to go to the emergency room, for example. If the issue isn't an emergency, they should visit their doctor instead. If you provide telehealth services, which typically are less expensive than emergency room and doctor visits, introduce your employees to the program and encourage them to use it when appropriate.

  1. Think Out of the Box

Employers often don't take the time to consider these strategies:

  • Consider using narrow, or limited, networks that deliver top-performing physicians at affordable costs.

  • Contract directly with providers that not only specialize in high-cost or high-risk procedures — such as transplants, back surgery and joint replacements — but also offer bundled payment solutions.

  • Carve out high-cost prescription coverage by contracting directly with a pharmacy benefits vendor to administer your prescription program.

To identify winning strategies to reduce health care costs, employers must be willing to work directly with vendors that understand the health care market, including how to survive its volatilities.

This is just the beginning — there are a lot of ways you can shave some dollars off an ever-rising health care bill. Give us a call today, and we'll go over the best ways to be economical while continuing to provide the health care benefits your employees want.

 
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Kirsch Kohn & Bridge, LLP
Kirsch Kohn & Bridge, LLP
21550 Oxnard Street, Suite 200
Woodland Hills, CA 91367
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