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November 2008 return to the table of contents

Smaller Companies Report Greater Value, More Responsiveness From Healthcare Benefit Providers

As more and more firms look for ways to improve their healthcare benefits while keeping a handle on costs, healthcare insurance providers have responded.

In its yearly poll of participants in healthcare benefit programs, overall satisfaction went up to 59% from 54% in 2007, according to Information Strategies, Inc., this newsletter’s parent.

A majority of small business management respondents (53%) indicated they saw improved offerings from healthcare benefit providers in 2008.

The poll of 831 small business leaders was conducted in October as part of ISI's annual study of small business operations.

According to comments in the survey, the perception from business leaders was that insurance companies were being more responsive to their needs, particularly as the economy declined.

While insurance providers offer different programs, all appear, in the minds of a majority of respondents, geared to provide more value to corporate clients and employees.

One perception noted by respondents is that to meet this challenge, insurance providers have expanded other choices available to small business leaders, while holding down total healthcare benefit costs.

Recognizing that many employers are increasing employee contributions, insurance providers have made healthcare benefits more attractive to staff members while easing the process of management-employee interfaces.

One of the leaders in this area is UnitedHealthcare, which has pioneered some of the more innovative offerings during 2008. To see what some of those innovations are click here

As several recent studies have shown, employees view employers more favorably when there is a wellness option offered in their healthcare benefit plans.

One methodology used to provide greater value is to combine wellness, consumer directed healthcare options and high deductible features.

The goal is to more intelligently draw employees into the healthcare utilization process, resulting in a better healthcare benefits environment for employers and their staff.

UnitedHealthcare saw this need early and has offered this option to many employer-groups, particularly in the small business sector.  UnitedHealthcare, like other major insurance providers such as AETNA, also reward companies that make wellness an important part of their benefits regimen.

They have also made these programs more affordable and useful to small business operations.

Information Strategies, Inc., this newsletter’s parent, has also found that wellness options are popular with individuals purchasing their own insurance. This is particularly true in the small business sector.

In one recent ISI study, 43% of small business respondents said they had added a wellness option to their healthcare benefit option.

Perhaps the single greatest impact on company provided healthcare programs is the advent of consumer directed healthcare plans. Reimbursement Accounts (HRAs), Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs) have proven popular ways to manage costs.

CDH plans are particularly attractive to small business managers because they encourage employees to help manage their benefits usage.

In the same survey, one in four (24%) of small business respondents said they had received positive feedback from employees when CDH plans were carefully explained to employees.

In contrast, less than one in 10 (9%) said they had received negative feedback from such programs.

Companies with plans in place for more than a year reported 79% positive feedback and half said they were expanding options either in terms of employees covered or the breath of their programs.

Small business employees surveyed by ISI have ranked UnitedHealthcare, AETNA and WellPoint as the most popular in terms of service and options.

Smaller companies also recognize that CDH plans help employees better manage healthcare issues in retirement.

UnitedHealthcare is also one of the largest providers of supplemental healthcare insurance to retirees, and is a leader in teaching about the benefits of better healthcare usage management.

During 2008, insurance providers have come to recognize their importance to the long-term profitability of the companies they serve.

To that end, they are experimenting with a variety of programs in states across the nation.  Further analysis of these innovations will be reported on in later issues.


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