ChemDesign, a custom chemical manufacturer in Marinette, Wisconsin, has received a best-in-class healthcare performance award, being recognized in the top nine percent of mid-sized manufacturers who responded to Gallagher’s 2018 National Benchmarking Survey. The award comes from Gallagher, a global leader in insurance, risk management and consulting services. This designation is awarded to survey respondents who score among the upper 25% in controlling healthcare costs and managing human resources. Over 4200 participating organizations from across the country responded to Gallagher’s annual survey, considered one of the most respected and comprehensive surveys in the industry.
AFFORDABLE HEALTHCARE COVERAGE
The journey to achieving affordable healthcare coverage became a top priority for ChemDesign in 2016. The mid-sized employer of 115 was facing a 20 percent increase in health insurance premiums for the coming year.
Randy Christl, Chief Financial Officer, decided it was time to do something different and assembled a task force to evaluate options. An exciting option of belonging to a group healthcare captive was found. A “insurance captive” is a means to gain the benefits of being self-insured while mitigating the risk by allowing a mid-sized employer to spread out their risk as part of a bigger group. The team found a captive that was unique, carefully selective of its members, and focused on wellness. From the outset, ChemDesign has been committed to being engaged and following the captives recommended framework to control costs.
Captive membership led ChemDesign to be a leader in their community with instituting a new healthcare pricing system for the organization. The new system came with two major cost-management initiatives: Pay fair prices for provider services and increase transparency of costs both for the company and the employee. ChemDesign and their insurance consultant, Gallagher, have been successful in securing agreements with not one, but three of the most prominent health care systems in the area.
ChemDesign, additionally, “carved out” their pharmacy benefits, following a non-traditional program. All employees have prescription coverage as part of the medical benefits, but the pharmacy program is carefully managed by the Captive’s expert pharmacy benefit manager. The majority of employees have made the change to generic prescriptions, often using mail-order as a successful way to obtain the medications needed.
WELLNESS BENCHMARKS AND INCENTIVES
Christl also joined a sub-committee in the insurance captive to understand and implement wellness programs for their employees.
ChemDesign developed benchmarks to understand the overall wellness of their employees. Employee awareness of the connection between getting healthier as a whole and lower healthcare costs is key to the continued success of their program. ChemDesign stresses the value in healthy habits leading to a decrease in the collective risk to their insurer. They offer employees up to a 20 percent discount from their premiums if they complete an annual Health Risk Assessment and see their doctor for an annual wellness exam. Other wellness incentives and programs also exist.
Victoria Seligmiller, Benefit Consultant for Gallagher, is impressed by the sincere care Christl and his team have for their employees. “For a group of their size, they have accomplished a great deal in ways that many others struggle to succeed. Their desire to progressively take steps to manage costs, while always putting employees first provides a framework that others can emulate.”
ChemDesign has kept their healthcare premiums stable (no increase) for the last three renewals. In January 2019, ChemDesign started the year off strong by providing a premium-free month for insured employees. With the latest round of renewals in May 2019 employees saw a five to ten percent premium reduction. Christl states, “Today, we feel like we are in control of our plan. Our message to employees continues to stress that improved health truly leads to savings from decreased costs coming back to us.” Get your copy of the executive summary of the Gallagher 2018 U.S. Benefits Strategy & Benchmarking Survey https://www.ajg.com/us/news-and-insights/2018/11/us-benefits-strategy-benchmarking-survey/