When it comes to employee benefits, sometimes big savings can come in low impact packages. But to get there, you need the right strategy and toolkit.
For a large independent private school in New York City, uneven participation in their tiered health plan meant unnecessarily high costs for the institution and plan members. But with the right health plan offerings and educational rollout, Corporate Synergies made improvements that saved the institution nearly $1 million in the first year.
Like many employers, this school was eager to find savings opportunities as health insurance premiums crept upward but wanted to ensure minimal disruption for their participants. The school’s claims were within the industry average, further convincing leadership that there were savings opportunities to be found.
With nearly 250 employees enrolled in a tiered program with two options, the health plan covered a wide variety of employees and their family members with different needs.
They offered a tiered plan with one “benefit rich” option for in- and out-of-network coverage at a higher premium and one in-network high deductible health plan (HDHP). Employees were skittish around the HDHP option, with most opting to pay higher premiums for the top-tier plan. This strategy had not yet yielded significant savings.
In order to encourage participation in the HDHP plan, lowering premium costs for the employer, Corporate Synergies recommended the addition of a Health Savings Account (HSA) with contributions from the employer.
For employees moving to the HSA-backed plan, the network and coverage would not change, but premiums would drop dramatically. Employees would only be tasked with learning to take advantage of their new savings accounts.
The institution was generous with their contribution to the HSA, further sweetening the deal.
THE CSG ADVANTAGE
But even the strongest program can’t stand on its own. With vast experience in this type of plan structure and the education industry, the Corporate Synergies team was able to craft a custom employee communication and education plan to ensure everyone understood the new option and felt supported if they chose to make the switch.
The plan included fully branded educational materials in the voice of the institution and on their own letterhead, starting more than six months before enrollment was set to begin. With this much runway, Corporate Synergies gave employees plenty of time to learn about this new offering and gauge its value for their situation. More time also means less pressure in decision-making, which can often lead employees to stick with what they know out of fear.
The Corporate Synergies team also offered the assistance of its benefits concierge service, BenefitsVIP®, to ensure enrollment went smoothly. BenefitsVIP® helps manage an employee’s claims, coverage and paperwork to take the stress out of using their benefits.
Of the nearly 250 employees enrolled in the plan, 90 chose to switch over to the HSA in year one, saving the institution just under $1 million in premiums. This meant that for every five members who made the switch, the institution saved $50,000.
This represents a 37% migration to the new plan. For reference, the industry average for voluntary migration to a new coverage offering is between 3-5% in year one.
Employees also got in on the savings. For a single person on the original lower-tier HDHP, they saved $3,100 in premium contributions. For the bulk of individuals who were covered by the premium plan, there was an annual savings of $6,000.