Healthcare Challenges, Opportunities, Strategy and Execution Since 2004 healthcare costs have escalated 69% and is a major expense to companies. Increases in health care costs are due to the aging population, the comprehensive of insurance, increased worker income, advances in medical care, cost of administering care and provider induced demand. However, healthcare is such an important aspect to attract and retain the right employees that your company cannot just avoid it. Regarding your company there are some challenges, opportunities and strategies for healthcare that your HR can implement and execute.
-Health care benefits will produce overall positive outcomes for an organization in that organizations will recieve higher productivity from employees.
-Employers will see lower absenteeism.
-There will be an increase in employee morale and loyalty.
-By providing health insurance employers will get a larger tax deduction annually.
-Employees will also recieve a tax exempt and tax free compensation from benefits protecting them from unforeseen finance hardship.
-By providing health benefits companies can manage costs.
-Some challenges is providing health care benefits that will help remain competitive.
-Also it is a challenge to provide heath care that are attractive enough to get the best employees and retain them.
-It might be a challenge for a company to figure out which health care benefits would benefit the employees the most.
-Deciding who to extend the coverage to.
-Deciding not to provide coverage will face the company large penalties.
-There is a challenge in embracing the processes and technology necessary to effectively manage these processes.
Strategy to improve:
I believe in order to reduce costs your company should instead self insure. Accepting the financial risk for employees will save money by avoiding unpredictable cost swings. Your company can purchase stop loss insurance to limit liability and shift some of the risk but the outcome will be cheaper than otherwise. To do this you can employ a third party administrator to pay the claims and provide the employees customer service. By joining this larger risk pool, more cost control options will be available to reduce internal administrative load and will offset the impacts of employer employee conflict. Effectiveness in your organization’s strategy will correlate with how transparent your company is. Sit down meetings to inform employees what they are getting and the cost of the program will increase companies morale and loyalty. The next step your company should engage in is designing programs and incentives to improve healthy lifestyles. The healthier the people are the healthier the business is and ultimately the cheaper health related costs will be. Business is all about the money and if you can improve health within the organization not only will there be less absenteeism but also greater productivity. Some ways to promote healthy lifestyles is to provide frequent physical examinations, immunizations and preventive screenings. By doing this employees are less likely to become sick or might catch something when it is easier/cheaper to…