"Health care spending is the topic that's finally hit the boardroom, because it is absolutely affecting everyone's bottom line," said Pamela Butler, director of benefits for Acuity Brands, a lighting and specialty chemical manufacturer. "The cost continues to go up and up and up, and, at the end of the day, the only true influencer on those costs is individual behavior."
According to the Kaiser Family Foundation 2005 Employer Health Benefits Summary, the rate of growth for health insurance premiums slowed to 9.2 percent in 2005 from 11.2 percent in 2004. That's a small ray of light in an overall grim picture. Since 2000, premiums for family coverage have increased by 73 percent, compared with wage growth of 15 percent. Not surprisingly, the percentage of firms offering health benefits to their employees fell from 69 percent to 60 percent in five years.
"For the past three years, we've been very diligent about the development of our medical plan. We've been able to keep [increases in] health care costs contained to low single digits by some cost-shifting and by making a sincere attempt to provide employees with education, information and tools to change behaviors," Butler said.
Deductibles and co-pays went up, but premium costs for employees stayed the same.
Part of Acuity Brands' education efforts include a wellness Web site, started in 2004, with monthly exercise and nutritional challenges through which employees earn points. The 216 employees who participated in the Kaiser Permanente Corporate Run/Walk received wellness credits, making them eligible for gifts. Top point-holders received $150 in a health care flexible spending account last year.
"Most employees don't realize that they are paying less than 20 percent of the total cost of their health care. Our country has the only economic model where the consumer of services isn't paying for it directly, so there's been no incentive for people to learn how to be informed consumers," Butler said.
That's changing as more companies look at alternative approaches to cutting health care costs or get out of the business altogether.