Issue 004 - Simple Ways to Stem the Tide of Rising Health Care

This week we will be discussing very simple ways to help control your health care costs. Your comments are welcome.

For those of us paying the bills we don’t need a lot of nudging to remember what we are experiencing in health care right now in America. Even though the rate of inflation is under 3% annually, we still have to deal with out of control fuel (which we focused on last week) and health care costs.

Health care costs have doubled over the last 5 years, and it is almost unheard of to get an increase of less than 10% in any given year.

We will focus on three areas that can help stem the tide.

· Education

· Freezing costs

· Alternative plans

Education:

Have you taken the time to present to your employees the real cost of Health Care? Produce a “Total Pay” document that shows the company’s premium as part of the employees earning. A lot of employees take health care for granted; make sure they know what it costs. Also include your portion of FICA in this document. Explain to the employees that they can help by choosing generic drugs over Brand Names. Help them understand that taking better care of themselves in the long run will reduce the costs everyone has to pay. It is important to make sure that they understand how rising health care has a material effect on their pay and future raises.

Freezing costs:

This method is frequently used today to control health care costs. Freezing the contribution at a previous level pushes the cost increase to the employee, not to the employer. Although this is not popular, to say the least it does establish the employers inability to handle future price increases. Also, many companies are now asking for more employee contribution which has a similar effect on costs. These tactics will not put you in a competitive disadvantage. We have found that most major corporations already instituted one or more of these cost containment measures.

Alternative plans:

In doing our research we have found organizations that can help you cut these operating costs. In Ohio, COSE (The Council of Smaller Enterprises) can provide free consulting to find alternatives to save you big bucks. In California, a company called CaliforniaChoice is a small business alliance that pools all their members to present a large membership base to health care companies. They then get a better “group rate” while giving you multiple choices of plans. In most areas the local Chamber of Commerce offers group plans under their name so that all members of the business community can participate in it. We use our Central Bucks Chamber for our health care insurance. It has served us well for over 15 years. Lastly, the web has become a great hunting ground for better rates and programs. One site, www.digitalinsurance.com, represents a nationwide group of brokers who will bid on your business. If uncomfortable buying health care over the Internet just do the research and call the companies directly to check them out. There is wealth of competition out there and buying smart is one sure fire way to reduce your costs.

EDUCATE, RESEARCH AND NEGOTIATE

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