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Benefits January 9, 2002
Cost Sharing A Strategic Move for HR Pros
January 9, 2002 (PLANSPONSOR.com) - Benefits
managers saw increased employee cost sharing as the most
successful method for controlling health plan benefit costs
in 2001, a survey by the Institute of Management and
Administration (IOMA) finds.
Reported by Camilla Klein
In fact,
- among firms that employ more than 500 workers, nearly 57.9% increased cost sharing,
- among those with fewer than 500 employees, 44.9% passed health care increases onto participants
Cost Control
Other successful cost-control strategies cited were:
- the addition of a mail order prescription drug program, cited by 22% of the sample,
- followed by the use of flexible spending accounts, mentioned by 20%, and
- some form of managed care or PPO plan, cited by 20%
According to the survey, several industry sectors report success with the managed care approach to containing health car cost, among them
- almost 30% of manufacturing firms,
- over a fifth of technology firms, and
- one in five health care companies
Automated Benefits
According to IOMA, automated benefits, with clearly established cost savings potential, are still out of the reach of many small employers,
- only 4.1% of respondents in the small-employer category listed automated benefits functions as the most successful cost-control strategy,
- versus 21.5% of larger employers
Not surprisingly, the industry group most likely to
embrace automated benefits functions was the technology
sector, logically, at 21.4% of respondents. Further,
technology companies were also most likely to self-insure,
with 35.7% using this measure to control costs.
Coverage
To cope with runaway cost increases,
- only 6.3% cut benefits offerings last year,
- while a further 15.1% turned to voluntary benefits offerings, chiefly in the non-profit, technology and services sectors, and
- one in 10 started wellness programs