If you could see a ranking of business owners and executives who best control healthcare costs and then designate the “top 1%,” you would have to include Susan, the owner of a retail chain in the Midwest.

Susan is a “one percenter” in controlling healthcare costs for three reasons:

1) She commits to thinking rationally about healthcare.

100% of rational, fact-driven business owners and executives tend not to view healthcare costs with the same rational approach they apply to other significant expenses.

Unlike other expenses, health insurance directly affects employees who are seldom educated adequately on how win/win scenarios can benefit both employee and employer at the same time. Usually, the employee expects the employer to have the best answers but the employer is under-resourced and assumes that a commissioned salesperson, the health insurance broker, will be able to figure it out with input from the HR department. The HR department is motivated to have all employees happy and not complaining. HR is also motivated to show that costs are not escalating dramatically year over year. All brokers want to keep the client and most want to keep the current level of commission – a motivation that too often automatically separates the broker’s interests from the client’s.

“Some owners see a broker the way tribal villagers see the village shaman,” Susan shared with me. “He’s the guy who interprets the dark secrets, and saves the employees who wholly trust him alone to deal with the things they don’t understand. This gives employees a sense of safety and security.” After gaining a full understanding of healthcare costs without the “help” of her previous retail broker, Susan had an interesting way of dealing with that broker. “I threw him off the porch,” she said.

2) She has owner/HR alignment.
Both Susan and her HR department must: a) share an objective understanding of all healthcare cost drivers, and b) master the best alternatives for reducing costs. Their ability to be fully engaged and aligned, which is more than mere agreement, is the second factor that makes Susan a member of the one percent. We aren’t suggesting they must do all of this on their own. They can rely on the truly UNBIASED insight and ongoing support of DCI.

3) Her total cost puts her in the one percent.
The total cost of healthcare is more than just the premium amounts. The true cost of healthcare is:

TOTAL PREMIUMS FOR THE EMPLOYEE ONLY (EMPLOYER & EMPLOYEE SHARE)

                       
PLUS

ALL ADDITIONAL PREMIUMS PAID BY EMPLOYEE OR EMPLOYER TO COVER DEPENDENTS

                     
PLUS

ALL DEDUCTIBLES AND COPAYS PAID BY THE EMPLOYER AND THE EMPLOYEE.

Add up those three component numbers then divide the sum by the total number of employees in your
plan. What do you get?

For companies in the bottom 50% of cost-efficiency, this number will be greater than $12,000 per employee per year (PEPY).

For companies in the top 50%, this number may be closer to $8,000 PEPY.

One percenters like Susan are well under $5,000 PEPY.

If you don’t already know your full cost on a PEPY basis, do the math yourself now or call DCI to perform the math with zero bias. It might be true that no one besides your retail broker could possibly reduce costs any lower and without sacrificing quality, but why risk it?

Before your company commits to another year of unnecessarily high costs, contact DCI. Our solutions and strategies do not require you to switch brokers or networks and you don’t have to reduce coverage or increase employee deductibles. Our analyses give you the insight and power to be a one percenter!

info@dcisolutions.net | 760-809-8734