Who is really responsible for the costs of health care in this country? We have been conditioned to point the finger at the Government, Private Insurance Carriers or medical providers. We have heard endless blame dam, the assault charge and the fury of fault-finding between these parties for many months now. Each would have us believe that others are solely responsible for the problems in our health care system. No doubt, however, it is shared fault and joint responsibility. The Government, major insurers and medical providers, I would suggest three additional parts of conviction:
(1) insurance brokers of
(2) employers and
(3) you and me individually.
There was and there will be many more question of the role of the first three parties have had in the creation of the current situation. My intention in this series of three is to expose the role of the three groups of the latter and suggest how these groups can become really part of the solution.
Health insurance brokers
To include brokers in this discussion may seem incriminating because it is my job. However, I do so with a clear conscience because the approach my business takes when representative of our customers. Last week I was discussing trends in Health Plans franchise high with one of our representatives local carrier insurance she told me that she had recently heard a broker him, said "I do not sell this product to one of my clients." The broker who made this comment was referring to a top Plan coupled with an HSA health franchise and the comment was made in the context of its commission. The carrier REP has transfixed the broker to admit showing does not a plan of some of its clients because of the impact it would have on its Board.
The use of a high deductible Health Plan (HDHP) strategy will generate a reduction in substantial and immediate bonuses - usually between 30 and 50%. You guessed it. The reduction in premiums: a corresponding reduction in the commission to the broker. How brokers are honest and ethical enough suggest a strategy aimed at their client that will lead to a sizable pay cut for them? Unfortunately, this is how the system is designed and creates an inherent conflict of interest unless the brokerage firm is built on a different model. A model which measures the success based on the savings to their customers. In this model, the broker will look always all first take advantage of the savings created by health plans of forthrightness in the construction of a proposal rather than looking at as a last resort or only if the client requests about these plans.
The Government actually provided some very good options for the employer health care plans. Flexible of spending accounts (FSA), accounts of health (HSA) savings and the arrangements for health (HRA) provide different ways of achieving premium savings and tax savings. If properly designed, these favourable tax plans may result in the equivalent coverage or higher for employees at a price lower than the employer. A well-designed plan accomplishes these win/win results must be performed by a broker who specializes in the design and administration of these plans, not a broker that simply suggested later or at the request of the client.
Survey Kaiser/insurgencies 2009 report-employer sponsored health benefits, we better understand why employers have adopted of HDHP and what were the results:
72% of companies offering an HDHP said the main reason for which they have begun to offer this option was to save on health care costs
49% of the companies offering an HDHP has reported that the result of more success has been the control of health expenditure
A further 27% reported that the result of more success has been encouraging employees to be better consumers of health care (who, in passing, ultimately led to reduce health care costs)
82% of employees enrolled in a HDHP reported being either very satisfied or somewhat satisfied with the plan while only 3% reported being very dissatisfied
Here is the surprising statistics.
Only 5% of the companies currently offering an HDHP say "very likely" to offer an HDHP with a HRA next year
Only 6% of the companies currently offering an HDHP say "very likely" to offer an HDHP with an HSA in the next year
(Kaiser Family Foundation, and 2009, pp. 166-167)
Why few companies is planning start HDHP offering when the results were so favourable to employers and employees? Brokers did not do a fairly good job of promoting these types of plans and educate their customers about the financial benefits of the use of a HDHP. Whether due to a lack of knowledge of the product or a desire to preserve their commission, there is fault with the brokerage industry to be more aggressive with the reform of positive health that the Government has already adopted. Brokers must be sufficiently well informed and ethical enough to recommend, design and implement these plans for the benefit of their clients. Employers must find a broker who is competent and ethical enough to recommend, design and implement these plans for their business.
Reference
The Kaiser Family Foundation and research in health & Educational Trust (2009). Employer benefits 2009 annual survey (electronic Version). 166-167.
Scott is a Consultant of benefits for the benefit of Design Specialists, Inc. (BDS) in their Office in Phoenix, AZ. BDS is a broker of full services and a Director of third party specializing in the design and administration of high deductible health plans that help businesses save money on health care without cuts to the coverage of employees. Prior to joining the BDS, Scott has more than 12 years of experience as Manager of human resources and CFO.
Experience of Scott and the balanced approach that it can work effectively with the CFO and HR managers to achieve the often competing objectives of HR and finance. In addition, responsiveness and organisational skills of Scott to manage the process of renewal and registration for customers in an orderly manner and timely at the time. Scott likes to help businesses save thousands on their health expenditures without cuts that have a negative impact on employees.
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