By Dianna Brodine, managing editor, The American Mold Builder
Predicting health insurance rates for 2021 is a difficult task. In some ways, the pandemic has resulted in declining healthcare costs in the current year: Individuals have reduced nonemergency visits to physicians and hospitals, and telehealth appointments have become more prevalent. On the other side of the coin, treatments and hospitalizations for COVID-19 and related illnesses have driven costs higher, and mental health treatment frequency has increased as the pandemic stretches on. As insurers submitted their 2021 rates ahead of the October 15 deadline for the health insurance marketplace, the Kaiser Family Foundation (a nonprofit organization focused on national health issues) found most insurers intend a modest increase or decrease in premium costs in the upcoming year.
“The most common factors that insurers cited as driving up health costs in 2021 were the continued cost of COVID-19 testing, the potential for widespread vaccination, the rebounding of medical services delayed from 2020, and morbidity from deferred or foregone care. At the same time, many insurers expect health care utilization to remain lower than usual next year as people continue to observe social distancing measures and avoid routine care, especially in absence of a vaccine or in the event of future waves of the virus,” KFF explained.1
However, insurance costs remain a major financial factor for both employer and employee. KFF’s annual Employer Health Benefits Survey, released in October 2020, showed, “Annual premiums for employer-sponsored family health coverage reached $21,342 this year, up 4% from last year, with workers on average paying $5,588 toward the cost of their coverage.”2
The report also pointed out that, “Since 2010, average family premiums have increased 55%, at least twice as fast as wages (27%) and inflation (19%).”
Businesses continue the fight to find ways to reduce healthcare costs, employing strategies that range from incentives for healthy habits to in-house wellness visits. The following article, originally printed in Plastics Business magazine (www.plasticsbusinessmag.com), provides another perspective on reducing healthcare costs – a collaborative on-site clinic shared by four Minnesota-area businesses.
- 2021 Premium Changes on ACA Exchanges and the Impact of COVID-19 on Rates, accessed Nov. 18, 2020, https://www.kff.org/private-insurance/issue-brief/2021-premium-changes-on-aca-exchanges-and-the-impact-of-covid-19-on-rates/
- Average Family Premiums Rose 4% to $21,342 in 2020, Benchmark KFF Employer Health Benefit Survey Finds, accessed Nov. 18, 2020, https://www.kff.org/health-costs/press-release/average-family-premiums-rose-4-to-21342-in-2020-benchmark-kff-employer-health-benefit-survey-finds/
Revamping Healthcare at Vital Plastics
by Lara Copeland, contributing writer, The American Mold Builder
Across the business landscape, companies are employing creative strategies to draw in new talent while also trying to hold onto current employees. Attractive incentives – like flexible hours and good pay – are among some of the leading priorities potential employees are looking for; however, affordable and unique healthcare packages also are top contenders. Some large corporations, such as Amazon, Apple and Facebook, have been offering on-site health clinics for a number of years, but this growing trend is making its way into smaller companies, too. The modern on-site health clinic not only treats injured employees, it also addresses overall health and wellness.
Motivation for change
In January 2019, Vital Plastics, located in an industrial park just east of the Twin Cities metro area in Minnesota, became self-insured, offering healthcare, dental and short-term disability plans for its 112 part-time and 110 full-time employees and their families. Additionally, in July 2019, this custom injection molding and contract assembly company – along with two other businesses and a local school district – opened a shared, on-site health clinic.
According to Vital Plastics President George Hauser, two main factors motivated the company to make this move. “We looked at it as a differentiator,” he said. “At the time we started participating in this conversation, attracting and engaging employees was quite difficult. So, we did something to be different, look different and feel different – we wanted to be appealing to people so they could see the value in our company.”
Company-sponsored healthcare offered another advantage. “The other thing we were striving to do is to control our healthcare costs,” Hauser added. “Every year we are faced with increases, and it just wasn’t sustainable anymore.” He commented that becoming self-insured and offering the on-site clinic were two ways Vital Plastics could get control of its healthcare costs and establish transparency. The company had spent money in the past offering wellness services, like a mobile blood unit or offering a copay for health memberships, but Hauser found that those services weren’t getting much “lift,” as he put it. “We simply decided to redirect our dollars,” he explained.
The clinic is staffed with a couple of medical assistants and a nurse practitioner. It operates 40 hours each week, but its schedule is staggered so that it can accommodate employees from various shifts. And, despite being shared among four entities and a large pool of insureds, people are seen very quickly.
As for the self-insured healthcare plan, Hauser remarked that it is “virtually the same plan we had when we were insured through a regular carrier. The only difference now is we fund it ourselves and have a third-party administrator while also having an over-line protection to help protect us from catastrophic issues.”
Collaboration and compliance
Becoming self-insured and opening an on-site clinic still may be a rarity, but as healthcare costs go up, the concept continues to attract interest. For others looking to implement something similar, Hauser mentioned some facets that have worked well for Vital Plastics and what a company should think about when considering such a paradigm shift.
“We collaborate well with the other companies in our group, and we have the ability to customize our specific plan to meet our own needs,” he said. “I don’t have to offer the exact same plan as the others in our group, but some items do need to be the same.” He continued, saying that while another company in the group offers to cover part-time employees, Vital Plastics only covers full-time employees. “We also can set different copay prices, for example.”
Hauser also emphasized the importance of staying compliant with any health savings account (HSA) regulations. “With an HSA, we can’t offer the clinic for free, so we ended up doing preventive care for free,” he explained. In this case, any diagnostic care is a $25 copay, but Vital Plastics contributes enough to the HSAs for these copays to be covered. He said there’s “room for maneuvering, but make sure you remain compliant,” while also noting that it is “important to research vendors and make sure you know who your administrator and your clinic provider is.
“Every single one of our plans is going well,” Hauser assured. “We are 17 months into the insurance plans and about 10 months into the clinic, and I can say that participation in each of these has increased over time.”
Vital Plastics is not resting on its laurels though. In 2020, the company added an incentive to its health savings account. If an employee goes to the on-site clinic for a physical, which is free, Vital Plastics makes an additional contribution to their HSA. “This has been well taken advantage of and well received,” Hauser noted.
As the company moves forward, controlling healthcare costs remains a top priority.
“We did not increase health premiums in 2020, and if I stay on trajectory this year, I can hold healthcare costs again for another year,” Hauser commented. Vital Plastics also strives to create more responsibility for the user. As for now, he is pleased with all aspects of the company’s healthcare offerings. “We are ahead of the game with all of our healthcare plans – we were last year, and we are again this year. That tells me that we’re doing it right.”