Building a Smart Employee Benefits Program
Will Glass and Brian McGratty of McGriff's Employee Benefits Division discuss when employers should look at alternatives for employee health care benefits and other tips.
This Q&A is sponsored by McGriff-Employee Benefits Division.
This article originally appeared in the Summer 2021 issue of Middle Market Growth. Find it in the MMG archive.
Authors: Will Glass, senior vice president (left), and Brian McGratty, vice president
(right)
Company: McGriff–Employee Benefits Division
Expertise: Will Glass and Brian McGratty specialize in national accounts for McGriff, the fifth-largest insurance brokerage firm in the U.S. Their focus for the last 18+ years has been on multi-site, multi-state employers. To date, this unique approach of RDI/ CORE has saved clients millions of dollars while still maintaining the highest level of benefits.
At what point should an employer look at funding alternatives for their health care spend?
There are many variables to assess when looking at funding alternatives. They include employee count, industry, demographic factors, geographic challenges and, ultimately, risk tolerance. Despite popular belief, the size of an organization is perhaps the least important variable. After a careful assessment of these variables, a program can be built with the appropriate insurance and protections in place to allow an employer to take on limited risk. By taking on this risk and leaving the standard, fully insured market, an employer gains tremendous control over volatile premium fluctuations, thereby allowing complete customization of their program.
How can an employer offer consumer-directed health care products and still drive employee retention?
Consumer-directed products like health savings accounts (HSA) are extremely popular; however, employers have concerns about funding an HSA knowing that employees can take those funds with them upon separation. Our clients have found tremendous success offering health reimbursement accounts (HRA) alongside an HSA. There are many advantages of an HRA, one being that the employer-funded dollars are rolled back to the employer upon separation. Employees with significant HRA dollars are less likely to abandon those accounts and leave the organization. Another advantage is the avoidance of “fund erosion,” where employees must drain HSA funds to cover high-cost prescription drugs. HRAs allow for a prescription drug co-payment.
What is the best way for an employer to offer a wellness program that drives engagement and maintains privacy for the employee?
Our clients have successfully managed this by incentivizing employees to engage with their provider. Employees are afforded the opportunity to receive incentive-based funds for simply establishing or maintaining a relationship with a primary care physician. This puts the employee on their own path to health with their provider. The employer is simply “funding” their incentive for this voluntary behavior, which has not only reduced the overall health care spend of the employer but has helped with retention and in some cases identified potentially life-threatening conditions.
