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Costs rise as workers skimp on health care

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in Employee Benefits Program,Human Resources,Leaders & Managers,Management Training

Consumers—including your employees—are hanging on tightly to every penny, fueling the biggest slump in U.S. consumer spending since 1942. One main cost they’re skimping on: their own health care—a move that experts say will lead to sicker Americans and higher health care costs down the road for U.S. employers.

About one in five employees admitted they avoided a recommended doctor visit in 2008 to save money, says a Watson Wyatt survey. Similarly, 17% said they skipped taking a prescription to cut costs. That’s up from 13% in 2007.

Take 7 simple steps to improve your employees’ health and drastically reduce your organization’s health care costs.

During last fall’s open enrollment period, just 19% of employees were willing to pay higher health insurance premiums in order to keep their deductibles and co-pays lower. That’s down dramatically from 38% a year ago.

“Workers will continue to look for avenues to save money in tight times,” said Cathy Tripp of Watson Wyatt.

3 ways to help employees cut their own health care costs

 

The silver lining: Two-thirds of employees say they’re trying to take better care of themselves so they can save money on doctor visits. And employers win when they nudge employees in the direction of better self-care.

“In the current financial climate, employers stand to gain from reinforcing messages on preventive care, wellness resources and the importance of following prescribed drug regimens,” says Tripp. “There are a number of behaviors that, if embraced today, will lead to substantial health cost savings in the long term.”

Here are three ways your organization can keep workers focused on their health even as they skimp on other expenses:

1. Publicize your wellness programs

Employees typically pay the most attention to messages when they’re relevant. So if someone is trying to save money on health care, staying healthy makes sense right now. Include messages about taking prescribed medicine and changing unhealthy behaviors.

The key is to communicate constantly about your wellness offerings. While some employees will respond to your messages, most will seek specific programs only after they need to lose weight, stop smoking or get in shape. Make sure your materials are in front of employees when they have those “aha!” moments.

In 7 Easy Steps to Slashing Health Care Costs through Wellness, Brad Cooper, CEO of U.S. Corporate Wellness Inc., will teach you the 7 easy, practical steps to launch and manage an effective wellness program in your organization. The benefit: You’ll take back control of your health care costs. Register now for this interactive event...

2. Counter penny-wise and pound-foolish thinking

Discourage employees from postponing annual physical exams and doctor visits, and from skipping doses of medications to save money.

3. Steer staff to low-cost options

Encourage workers to choose generic or lower-cost drugs, seek more affordable treatment options, look for inexpensive care providers and negotiate lower prices with doctors. The survey showed an upward trend in all of those areas (see box).

One-fifth of employees in the survey say rising health care costs are preventing them from saving for retirement, and 13% reduced their retirement plan contributions in 2008.

In addition, more workers say they’re having trouble paying for even their basic needs—15% admitted as much in 2008, compared with 10% the year before. And more say they have tapped savings accounts and borrowed money to pay expenses.

“The health-wealth connection is more clear than ever, as pressures from high health costs continue to pose challenges to both companies and employees,” says Tripp, who advises employers to focus on open communication and education to help employees figure out how to manage costs.

 

During this interactive webinar, you'll learn:
  • How employees’ health (or lack of it) affects your direct and indirect costs.
  • The 7 steps to set up and administer a proper wellness program—from analyzing your staff to tracking results.
  • Best practices of America’s top corporate wellness plans.
  • The I-I approach: How to use individual goals and incentives to maximize participation and results.
  • Which incentives work best— Prizes? Time off?
  • A dozen questions to ask yourself to see if your organization is on the right track.
  • How “token” wellness efforts can do more harm than good. (Lifestyle changes don’t just happen … they require a pattern of relate, repeat, reframe.)
  • How to track realistic ROI of your wellness program.
Finally, Brad will provide participants with a 10-point “Wellness Program Micro Audit” that they can print, save and continue to revisit to keep their wellness programs on course for success. Register now for this need-to-know event!

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