David Mair

Are you getting the most for your dollar with your company's health insurance plan? When we ask that question, quite often the answer starts as "Yes" and pretty quickly turns to "I don't really know."

The simple fact is that most business leaders only know the toll rising health insurance costs are taking on the company, and it worries them. In fact, a recent survey published in CEO Magazine reports 7 out of 10 Chief Financial Officers consider rising health insurance costs as their #1 concern.

Here are seven reasons many businesses spend more of their hard-earned money on health insurance than they need.

1. Your broker focused you on premiums instead of claim costs.

It’s not premiums that are killing your budget. It’s claim costs.  Beginning in 2014, it will be the cost of claims in community ratings. However, most businesses only see the impact when the shock and awe premium increase arrives. You need resources and partners that focus on your real costs of care and their drivers. With them, you too can enjoy the feeling experienced by a CFO who recently shared with employees their health premiums were not increasing, at all, this year.

2. Your insurance policy makes you pay too much for doctor office visits.

According to the American Medical Association, about 70% of physician office visits are not necessary. For an employee earning $22 per hour, a single office visit can cost as much as $254 out-of-pocket, including lost wages. You can do better. Steve, a client’s employee, recently consulted a physician and had a prescription called in to his pharmacy. He didn’t have to leave the office, except to pick up his medication, and his total cost was only $4.00! What do you pay?

3. Employees don’t know what medical care costs (but they do know for a gallon of milk or gas).

Many people don’t know what an office visit, a trip to the emergency room, or a simple surgery costs. More importantly, they don’t know they can ask. John, a local physician, asked his newborn son’s pediatrician what circumcision cost. The answer amazed him. If done at the hospital it would have cost $1,485. To have the same doctor perform it in his office would cost $288. By asking, John and his family saved almost $1,200.

4. You’re missing the full benefits of medical reimbursement plans.

A good medical reimbursement plan helps employees pay for necessary care while controlling medical costa and tax liabilities. Unfortunately, too few businesses take full advantage of the benefits. For example, a $2,000 employer-funded HSA costs $2,000, and the money leaves if the employee does. The same $2,000 in a well-designed HRA costs an average of $900, unused funds can roll over, and you decide when it is portable.

5. Your provider network is too limited.

Most health insurance provider networks miss the opportunities offered by global centers of excellence, including outstanding results, affordable costs, and the latest in medical advances, along with treatments not yet available in the US.

6. Your health insurance company, rather than your business, wins when you reduce claims costs.

All health insurance is built on a foundation of expected claims. If claim expenses are more than expected, your insurance protects you from catastrophic costs. However, if claim expenses are less than expected, the insurance company keeps your money, rather than returning to you. It doesn’t have to be that way.

7. Your agent hasn’t told you there are better options.

Like many business leaders, you may have been told there are only a few insurance company or your company is too small to use one of today’s newer health insurance options. Maybe worse, your agent doesn’t even know or understand these new programs. The truth is, if you have 30 or more employees, you have new and better options today.

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At Soter Healthcare, we believe in working with you to design insurance plans that maximize benefits, so that you can attract and retain top talent and be effective stewards of your financial resources. We challenge conventional wisdom and innovate to bring you ways to minimize claim costs without sacrificing access to medical care.