Thursday, August 14, 2008

How you can offset rising health care costs in 2009

The bad news: There will be a double digit rise in health care costs in 2009.

The good news: It’s the smallest increase over the past six years and you can do something to minimize the pain.

Heath care costs are predicted to rise more than 10 percent next year, according to an Aon Consulting Worldwide survey of insurers. It’s the smallest increase over the past six years, leading experts to believe that employers’ actions to improve employee health are paying off.

In order to save more money on heath care in the future, companies must spend more money on health care now, according to health care industry experts.
“CFOs have always viewed health care as an expense, but rarely as an investment” said Jerry Ripperger, director of consumer health at the Principal Financial Group. “But improving the health of your employee base, rather than simply providing reimbursements, is an exercise in risk management with a true ROI.”
Unless your company has the resources and staff size to warrant an on-site clinic, your best bet is to develop an employee wellness program. Relatively simple and cost-effective to set up, wellness programs have proven to be a healthy investment.

Overall, employers have seen a $2.45 reduction in medical claims for every dollar spent implementing an employee wellness program, according to Ripperger in Workforce Management.

Not only do wellness programs reduce the amount of employee doctor visits by improving overall health, they create more loyal and engaged employees.

According to the Maritz study, employees who participate in their company wellness program:
  • have significantly higher job satisfaction levels,
  • are more likely to remain at with the company long term,
  • and are more likely to recommend the company as an employer to friends and family.
Even employees who occasionally participate in a wellness program feel more engaged with their employer than those who never participate. Active and sporadic participants also have lower absenteeism, taking significantly less sick-time than employees who chose not to participate at all.

What you can do: Start an employee wellness program with a high number of participating employees and you’ll have higher productivity and engagement, better employee health, lower absenteeism, and lower health-care premiums.

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