Healthcare options-opinions please?

Lisa TBM

Hi everyone, just looking for some feedback. We are considering offering a monetary benefit to our employees who do not elect our healthcare coverage. We contribute about 80% toward premium for all tiers on medical and pay 100% of their dental and offer an employer paid, employee only life insurance policy.I was considering a once per year, or once per quarter payment... What are your thoughts? Thanks!

lorrie

We have considered this is the past, but decided against it. Bottom line for our company: the cost of administering the program would outweigh the benefits.

That doesn't mean it's not a good idea for some, but we decided it was not worth it for our company.

Dutch2

Same here. We decided against it as well. One point to consider is that (of course) those that would not take the coverage are the ee's that are normally the most healthy and therefore would be less likely to benefit from being in the plan. This would leave those in the plan that are the ee's mostly to have medical claims. So with less premiums being paid into the plan (from your healthy folks not in the plan) you can count on this driving up your costs each year. Your costs would be a larger percentage of the premiums you are paying. Plus we thought that we "sort of" owed it to our ee's to make sure they were covered; just in case something unexpected happened. If this were the case and they had no insurance it could really devastate a family.
In 2000 we went to a partially self insured plan with a re-insurer to pick up the cost after it reaches $30k for each participant. I've averaged the total cost to our company over the last five years and we are averaging less dollars spent each year than we paid for a fully funded plan in 1999. So far so good, however, if the plague comes to town, we will be hit hard.
Good luck...

FunHRBanker

We currently offer a cash benefit for those who do not enroll in our medical plan. They must submit proof of other coverage before they are paid, and must be with the organization at the end of the year to receive payment. We currently pay half of the bank's portion for a single person (about $2200 this year), prorated based on how many hours they work.

Kiwi

We do this as a component of our cafeteria plan. People who waive the health coverage get a specific dollar amount per week (weekly payroll) that they can defer to their 401k plan. Health waiver deferrals to the 401k are matched by the company the same as the weekly salary deferrals. The cafeteria plan also gives them the option of taking the waiver dollars in a lump sum at the end of the plan year.

marc

We used to do something similar. The situation Dutch described came to pass for us in a very real, very expensive way. The "negative selection" process had people on our group plan that could not get insured elsewhere. That meant they had medical conditions that made the premiums very high.

Those of us that were healthy took other options. We did require proof of other insurance, but some of our EEs went to those cheap, major medical policies that offered very little real coverage.

In the end, we went with a 100% company paid HMO for the EE and brought the cost of insurance under control ----- for now.

We are looking at High Deductible plans combined with either medical savings or reimbursement accounts as the next alternative. Lots of things to consider before pulling that trigger.

Lisa TBM

Lots of good info here, I really appreciate it. We are leaning toward running this through our Cafeteria plan, but probably not this year, I am going to research it a little more as far as administration and cost. Thank you all very much!