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Plan Design
As Defined Benefits continue to be substituted with Defined Contributions an employer is faced with new opportunities and new challenges. We want to ensure that you have the expertise at your fingertips to meet these opportunities and challenges. From a global perspective one can appreciate
premium savings – dollars freed up to be used for wellness,
tangential benefits like dental or long-term care all while providing
more to your bottom line. The challenge lies in understanding the
myriad of options available to you and how comfortable you are
with sharing or r The defined benefit approach – for all of its selling points – especially from the perspective of the employee – ultimately did very little to rein in costs. Something as simple as a co-pay, although often requested by employers and employees alike can be a very destructive force in meeting everyone’s stated goal of cost containment, individual accountability and overall employee health. Co-pays have led us all to a path of complete ignorance underlying costs associated with a doctor visit. It not only encourages overutilization – but breeds a more destructive force – one that drives down the perceived value associated with a visit to the doctor, ER or hospital. Raymond J. Keating, chief economist for the Small Business Survival Committee, argues that the problem stems from the fact that Americans are essentially over-insured to a large extent because 3rd party payers shield consumers from the real cost of doing business: “When a third party-whether an employer-provided health plan or the government-picks up the tab for reasonable and predictable health care spending, demand is driven up, and consumers and health care providers possess few, if any, incentives to be concerned about costs.” The attraction with the defined contribution approach usually starts with increased flexibility that allows the Employer to respond more appropriately to the diverse needs of its employee population and oftentimes with less employer management(depending on size of group and plan design election). Or it may equate to greater employer control and predictability of health care costs – depending on the model you may incorporate. It does however ask for more employee accountability which may take some adjustment, but those who have adopted a consumer driven approach appreciate the increased choice and savings many consumer driven – employer provided plans bring to the table. If your organization wants a more traditional approach – our team of experts can easily assist you – with the added value of providing a game plan for the future and guidance on how to get your organization to the next level. It will require greater communication. We will have the resources available to assist with administrative support, due diligence, employee education and wellness. |
elinquishing
the management of such benefits. We do think that there is an opportunity
to turn a cost center into a vehicle that increases worker productivity
and their overall health and wellbeing. A shift in the marketplace
away from defined benefits to defined contributions should not
be viewed as a simple cost cutting measure. Anyone can cut costs.
Our goal is to increase the overall benefit package if possible
with an emphasis on driving down risk factors via a wellness program
that focuses on ROI…not just from the perspective of numbers,
but from the overall health improvement of the employee population.
This emphasis places benefits squarely in the center of attracting
and retaining a thriving – able bodied work force.