In today's business landscape, healthcare costs are spiraling out of control. Employers are grappling with an annual healthcare spend of around $15,000 per employee - a figure that's rising three times faster than wages. But what's really driving these costs, and why do traditional cost-cutting measures often fall short?
Let's dive into some of the hidden factors inflating your healthcare expenses:
The Prescription Drug Dilemma - Did you know that prescription drugs account for a whopping 25% of employer healthcare spend? With specialty drug costs skyrocketing and new, expensive medications constantly entering the market, this is a top cost driver that many employers struggle to control.
The Coverage Problem - Many of your employees might be eligible for government health programs or marketplace plans that could provide comprehensive coverage at a fraction of the cost. By not exploring these options, you could be missing out on significant savings opportunities.
The Family Plan Fallacy - For employees with working spouses, you might be covering claims that another employer's plan should be handling. This silent cost creep can significantly impact your bottom line.
The Price Variability Puzzle - Healthcare costs in the U.S. aren't just high - they're highly variable. The same procedure can cost 200-300% more at one facility compared to another in the same city. Without the right tools and incentives, your employees might be unknowingly choosing high-cost options.
The Funding Strategy Trap - Fear of unpredictable, high-cost claims often keeps employers locked into fully insured health plans. While this can offer stability, they also include hefty profit margins for insurance carriers, leading to higher overall costs.
Understanding these hidden culprits is the first step towards regaining control over your healthcare spending. But knowing the problem is only half the battle - the real challenge lies in finding effective solutions that don't compromise the quality of care for your employees.
That's where our expertise comes in. At Cottingham & Butler, we've developed innovative strategies to tackle each of these issues head-on. Our approaches have helped clients achieve remarkable results, such as:
Saving an average of $782 per employee per year on prescription costs
Generating total savings of $4.8 million through alternative coverage options
Saving an average $4,200 per service that employees shop for
Eliminating the 5-8% profit margin typically built into fully insured premiums
Curious about how we achieved these results and how you can apply similar strategies to your own benefits program? We've compiled our most effective tactics into a comprehensive guide: "5 Benefits Cost Savings Strategies Every Employer Needs to Know."
This free e-book offers in-depth insights into each cost-driving factor and provides actionable steps to implement cost-saving measures without sacrificing the quality of your benefits package.
Ready to take control of your healthcare costs? Download our free e-book now!