Tom's Take Blog

January 23, 2019

How often should an employer re-assess their health plan?

Tom’s Take: These days, I see far too many employers who are only taking a thorough look at their health plan details at year’s end, when the clock is ticking and renewal is getting close.

 

Here’s the problem with that: if they’re alarmed by the numbers and decide it’s time to make a move, it’s often too late for the coming year.

 

The truth is, we should always be paying attention to what’s happening with our health plans and looking at the trends. Yes, this can be more difficult with fully funded plans, as the numbers are typically only presented around renewal time and don’t give you an idea of what’s been happening by month or quarter.

 

However, this data is accessible year-round with self-funded plans, and having access to it provides a huge advantage.

 

Here are a few things to consider regarding the “health” of your plan. For self-funded plans, what are your PEPM/PEPY costs and how have these changed over time? How much are your monthly health claims and what kind of patterns are you seeing with them? For example, are there frequently occurring health issues that could be minimized or more effectively managed with added plan benefits/programs? For fully funded plans, what are your employee premiums now and how will these be affected with the rate quoted for renewal? How has this percentage changed in the last few years?

 

Aside from financials, another thing to consider is if your plan still fits your employee population. Has your company grown? Are there benefits that need to be added, or others you’re paying for that aren’t being utilized by your employees? Do you need more flexibility in making plan adjustments?

 

If your current plan costs are skyrocketing, or your plan does not provide access to rich plan data or options for customization, it might be time to consider available alternatives. Bottom line, the more often you review what’s happening with your health plan, the better prepared you’ll be if a change needs to be made.

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