Strategic Spotlight: Containing Healthcare Costs
Proven Strategies for Success in the Public Sector
In these spotlights, the GFOA has identified various effective strategies ranging from wellness programs to increasing co-pays that can help the public sector contain healthcare costs while still managing the quality of employee health-care benefits. Each handout provides a brief definition of the strategy, surveys and comments from those who have and have not applied the strategy and other important points. A more in depth look at these strategies can be found in the full report titled, “Containing Health Care Costs”.
Strategy: Dependent Eligibility Verification
This cost saving technique is where the employer does an audit of their healthcare plan in order to reveal potential participants that are not technically eligible to participant. The handout provides more information along with some advantages and disadvantages to executing this technique from other employers.
Strategy: Benefit Wavier
Benefit waivers allow the employees to waive their health insurance benefit in return for cash payments. This handout provides more specific details and comments from both employers using and not using benefit waivers.
Strategy: Benefits Enrollment
Benefit enrollment can be done internally or externally, changing to a third party can help contain costs for the employer. This handout provides more specific details and comments from both employers using and not using an external service provider for benefits enrollment.
Strategy: Health Plan Design Changes
Changing the benefits and other elements of a healthcare plan can help alleviate some healthcare cost to the employer. This handout provides some specific examples of health plan design changes along with feedback from those who have and have not experimented with health plan design changes.
Strategy: Increasing Co-pays
Co-pays are the amount covered employees and dependents pay when they use specific services provided through their healthcare plan. This handout contains more information about why this technique has and has not been used by employers and the impact it has had.
Strategy: Increase Deductibles
A deductible is part of the cost of health insurance that is paid by the individual before insurance covers their medical expenses. Just like increasing co-pays this techniques has an immediate financial impact on the employees. This handout goes into more detail about deductibles; providing first hand comments on employers who have and have not increased deductibles.
Strategy: Promoting Preventative Treatment
Preventive Treatment is programs set up by the employer that take preventative action against future health costs, examples of specific programs are provided in this handout. Also in this handout are various surveys and comments about employers who have and have not used preventative treatment programs.
Strategy: Promote Section 125 Plans
Section 125 Plans are known as “cafeteria plans” and allow the employer to offer a healthcare plan where the employees have the option to receive certain benefits on a pre-tax basis. This handout goes into more detail about this type of plan and offers comments from employers who have worked with this type of plan before.
This handout provides more in depth details about self-funding and comments from employers who have and have not used this cost saving technique.
Strategy: Wellness Programs
Wellness programs are proactive programs provided by the employer that help to educate employees on healthy behaviors so as to improve employee health. This handout provides specific examples of wellness programs used by employers along with other comments employers have about this cost saving technique.