Our CEO, Scott Wood, provided health insurance actuaries with real world perspectives on the challenges facing the employee benefits market. He spoke to an audience of 350+ during his keynote address at the annual Society of Actuaries Health Meeting at the JW Marriott in Phoenix today.
Actuaries provide data, analysis and insights to help determine design and pricing of health insurance plans for employers. As healthcare costs have skyrocketed, the role of the health actuary has evolved to include financial modeling for various cost containment initiatives.
Scott explained to the audience that for mid-size employers the conversation has shifted from reducing benefits and lowering premiums during the recession years, to now designing benefits that will attract and retain employees in the current full employment economy.
“Employers are still grappling with rising costs for healthcare,” Scott said. “But today, their focus is on controlling costs while still providing benefit packages that make them competitive in attracting employees and to engage employees in reducing healthcare expenses through health improvement practices and consumerism.”
He outlined the drivers of healthcare costs:
- Cost of services
Choice of appropriate facility type/level of care
5% of members driving 50%+ of expenses
Using proven best practices for cost control, employee education, transparency tools and alignment of incentives, Benefit Commerce Group has achieved annual double-digit percentage savings vs projected spending with traditional health plans.
Scott showed medical costs savings graphs and explained that for an employer with $3 million of current healthcare spending, the combined savings for the employer and employees over the next five years would total nearly $3.25 million, using a properly designed strategy.
He also explained how new predictive analytics and population health initiatives are providing the data and financial reporting and modeling needed to predict future claims costs, identify gaps in care, and focus on health improvement techniques targeting high risk and emerging risk members.
In Arizona, Scott explained, there are excellent examples of innovation that are proving successful for employers. Multi-disciplinary care team programs are providing coordination and incentives to reduce medical care, lower healthcare costs and allow employers and employees to share in the savings.
In short, his presentation provided health actuaries with insights into how their work directly impacts lives and the costs of healthcare for employers and employees.
If you would like more information on this subject, contact us at email@example.com or call 480-515-5010.