In Henry’s prior entry “How to Spend Money on People,” he put the ROI on $2 worth of wellness in perspective. I agree — it just doesn’t make sense to skimp on such low cost fundamental prevention, particularly when it drives employee engagement (and profit).
So you want to do wellness, but your CFO has made it clear: there’s no budget for anything new or extra this year. Which begs the question…
What if you could do wellness without having to justify that new line item?
In my 15 years in the insurance industry consulting on corporate benefits packages, I’ve learned enough about how health benefits are mixed up, baked and served. Trust me; if you want wellness (and speaking of wellness), there is PLENTY of FAT to trim elsewhere.
Making the Right Tradeoffs
Here’s the basic tradeoff equation (and opportunity): low use, low perceived value vs. high use, high perceived value. In practical terms, who wouldn’t trade something that a minority of people use, and may well be unnecessary, for something that serves 75%+ of your population and people actually appreciate?
It’s actually really easy. Here are a few examples of basic tactical tradeoffs – you may have already made some of these changes, but to varying degrees even one or two can often do the trick:
- Separate in/out of network deductible accumulation
- Add a separate Rx deductible (affects more folks, but usually prudent for brand categories anyway)
- (Further) tweak ER coinsurance and co-pays
- (Further) increase out-of-network maximums, coinsurance and co-pays
Here’s how the basic math works – depending on your current plan design, one or some combination of the above adjustments can easily equate to about 0.5% in premium reduction or funding. If you assume a $700 composite health care rate – that equates to $3.50 per participant, per month – more than enough to fund a terrific wellness initiative across your entire organization.
Make Sure It Fits Your Company
There are other ways to fund (and more than pay) for this stuff, in a way that feels right and establishes a “we’re in this together” vibe with your employees vis-à-vis health care — such as tweaking employee contributions, designing premium-based incentives to kick off some dollars, or making more broad-based changes to benefit design in order to align incentives and create more engaged ”consumerism” in health plan consumption. The reality is, too, if you are fully-insured, your broker simply ought to be able to negotiate 0.5% out of the carrier, anyway. But we’ll save some more goodies for later…
In any case, if you are willing to make some simple, logical tradeoffs (and your broker is doing her/his job) you will get everything you want for your people “for free.” And if you do it right, you need not present your wellness program as an extra initiative with a separate line item cost. You can just bake it into your renewal in an entirely appropriate, justifiable, value-adding way.
The Bottom Line
Bottom line – envision two months post renewal, and you’ve installed a vibrant, best-places-to-work-style wellness program – based on tradeoffs you should have made anyway. Your employees (or clients) will thank you.
Why? Because prevention and wellness have the biggest bang for the buck in the health benefits world!
And again, it’s not difficult! We actually provide our Limeade Alliance members (and they tend to be the best advisors anyway ) with tools to make this an easy reality for their customers. Ask us at [email protected]…