With the new health care reform legislation, a lot more employers are now being required to offer insurance, and individuals are required to have insurance. That's the mandate. —Stephen Neeleman, HealthEquity founder and CEO
SALT LAKE CITY — With growing health care costs and further implementation of the Affordable Care Act on its way, employers are forced to come up with creative ways to continue to offer health insurance but also save their bottom line.
"CEOs and human resource groups around this country and particularly in Utah are tearing their hair out at the costs of health care, which are rising at an exponential rate," said Rick McKeown, president and chief executive officer of Leavitt Partners and the chairman of the Salt Lake Chamber's Health System Reform Task Force.
"Everything that we can do locally and in business to try and cut that cost will be beneficial," McKeown said.
The Salt Lake Chamber on Thursday rolled out a toolbox of sorts for employers of all sizes to help sift through tough choices and piling regulations, as well as curb costs when it comes to health care.
The last thing Richter7's Peggy Lander wanted was for her employees to be distracted by things like health insurance, but significant and daunting increases were on the horizon.
"It was not sustainable because of the 8 to 10 percent increases that we perceive are going to be happening in the future," Lander said, "so it was a point in this company to look at other options."
Richter7 made a move to offer plans with higher deductibles but also began providing a health savings account benefit, giving employees financial flexibility and expanded choice in how their health care dollars are spent.
The idea of a health savings account, or HSA, said HealthEquity founder and CEO Stephen Neeleman, is that it "empowers consumers."
"They can now not only save money for themselves and be more thoughtful about how they spend money, but also drive down costs for the employers," he said, equating the concept to a medical 401(k), except with triple tax advantages.
Neeleman said the money contributed by employees is tax-free, can grow tax-free and is spent tax-free on medical services.
"With the new health care reform legislation, a lot more employers are now being required to offer insurance, and individuals are required to have insurance. That's the mandate," he said. "Employers are looking for the best value."
In addition to HSAs and health reimbursement accounts, the chamber's toolbox provides suggestions for employers in four major categories: health and wellness, purchasing insurance, information and transparency, and consumer solutions.
Businesses throughout the state have already implemented strategies that have helped pare down rising health care costs, including workplace clinics at IM Flash and RC Willey, which provide convenient care and prevention services on-site.
The Larry H. Miller Group and others offer wellness programs that help to incentivize healthy habits among employees and better the corporate health culture. And a number of offices around the state, including at the Cannon Health Building, where the Utah Department of Health is housed, have implemented tobacco-free workplaces.
"This is not a panacea but an incremental step to provide information to employers as they contemplate new insurance options," McKeown said, also suggesting that instead of a candy dish, employers provide a fruit dish, in their assessment of their risk in coverage.
Earlier this fall, he said, Leavitt Partners was faced with a 22 percent increase in health care premiums for its 38 employees.
"It erodes our ability to give raises appropriately to people who are deserving," McKeown said.
A decision to utilize Avenue H, formerly known as Utah's Health Exchange, gave each of the firm's employees options to control their own costs, resulting in a lesser, 6 percent increase over last year's spending on health care.
In the aftermath of the election, businesses everywhere are faced with implementation of the Affordable Care Act, of which several hundred pages of regulations have already come out. McKeown said that for the 2,400-page legislation, at least 100,000 pages of regulations can be expected.
"Nothing in the way of regulations is easy to decipher," he said. "It is really hard for people to analyze that on their own."
The Salt Lake Chamber's toolbox was developed by a number of key players in the health care industry and the health and wellness sector. The services it provides, McKeown said, are meant to help businesses offset some of the significant increases, as well as interpret territory that may be unfamiliar to anyone outside the industry.
"Medical practice is going to change," he said. "It is going to be driven more by the economy than it is by the simple passage of a piece of legislation.
"The economy will dictate to us that we are unable to sustain the entitlements we've created. Medicare, Medicaid and Social Security are all in jeopardy as they presently exist, and we will have to reconstruct those models in ways that change the incentives and change the modeling of them," McKeown said.
Anything that can make the process easier, he said, shouldn't be overlooked.
Contributing: Richard Piatt