The Red Light for Health Benefits
To determine the right plan for your business, try planning your work—then working your plan.
An internet search tells us the phrase, "Plan your work and work your plan,” was used often in church sermons from at least the 1880s, though the origin of the saying is unknown. In 1989, Stephen Covey, author of The 7 Habits of Highly Successful People, restated this long-established idea as: “Begin with the end in mind.”
How might business leaders benefit from this approach when addressing a current, complex question: What to do about employee health benefits? Options seem to be everywhere. Watch for the red light. The last thing to do—not the first thing—is to shop.
Plan Your Work
Instead, first plan your work. Consider your organizational/financial goals and your employee relations objectives:
- What is your business (growth) plan?
- What types of employees will you need to hire and retain to achieve that business plan?
- What role does your benefit program need to play to meet that business plan and provide value to those employees?
- If it’s appropriate, have you asked employees what’s valuable to them?
- What specific, individual plans will you include in your total compensation/benefits program?
- What role will health insurance play?
- What are your financial/budget limitations?
- Are there alternative programs or plans available in the market that may meet your employee and business goals?
- Can your business/insurance advisors help you create plans that meet your goals?
Only after answering these important questions are you truly ready to decide what sort of group health plan fits your needs. Only at this point will you have decided, for example:
- Will you offer one health plan (i.e., one size fits all) or more than one?
- Which employees will be eligible? Will employees’ families enroll? How?
- What features are most critical?
- Will you offer an alternative plan or program for employees who are not eligible?
- What is affordable to the business?
- Will employees share in the cost of the plan: premium sharing; coinsurance, co-pay and deductible levels; contributions to personal savings accounts? How?
While you are considering these questions, it is also a good time to plan for monitoring and measuring in the future.
As one starting point, you might capture a snapshot of benefit costs when those were affordable to the business. Use that measure as an internal benchmark in future benefit planning and review. Other internal measures you may choose to monitor over time may include benefit costs as a percent of payroll or benefit cost per employee.
The key business question is: How can your business maintain or improve benefit affordability while meeting comprehensive business goals?
Work Your Plan
It may be tempting to “shop” and to purchase what is new or popular to take one decision off your list. A better impulse is to heed the flashing red light, resist quick shopping and do the work of answering the questions outlined here. Even if your insurance advisor has offered sound guidance in the past, it is good to periodically step back and plan your benefit program in line with your business goals.
Your decisions will help you work your plan: to know in the short term whether recommendations offered meet your business needs. Those decisions will help you ask good questions and challenge the first pitch, so to speak. Share your plan with your advisors. Challenge them to help you work the plan you have outlined: to sell you what makes sense for you and your business. The results of your plan and work to implement it will serve you well in both the short and long term.
Among those remaining questions to help you work your plan will be the impact of external requirements, including the Affordable Care Act. These requirements—and others in the world outside of your business—can be overwhelming and freeze thinking, or worse, become the basis of purchasing decisions if they shift towards the focus of business benefits planning. As outlined here, external requirements are a part of working your plan. They are not an appropriate plan of work. iBi
Raylana Anderson, CEBS, SPHR, MBA of Anderson Consulting is an experienced HR partner. For more information, visit andersonhrconsulting.com.