'Tis the Season . . . or, Insurance Woes

In my short tenure with CMCA, I've already found a least favorite recurring task. Each year around the end of November our insurance broker starts calling to set up a working lunch to look at our health insurance benefits. You'd think a free lunch would make any task more appealing but honestly I'm starting to dread the process. After some small talk our broker gives us the good news and the bad news. I always choose bad news first to get it over with. In each of the three times I've been involved, the news is always that it costs more to insure CMCA employees than we pay in premiums. In other words, our premium is going to go up. "So what's the good news?" I ask. "I think we can limit the increase." I whistle in mock pleasure. Within a couple of months of starting at CMCA he told me we were looking at a 47% increase! Anything less, I suppose, is icing. That time we had to switch companies to get a less painful increase. Even more scary, fewer and fewer companies are even interested in bidding on us. Our primarily-female business model, it seems, is prone to common female health conditions like pregnancy that make us expensive to insure. Further, the insurance/health industry seems to be getting screwier and screwier as rates across the country average about a 14% increase. I don't know how a nonprofit, much less a for-profit, can continue to absorb these kinds of costs. Our options include raising prices on our products (if we had a product), decreasing the quality of the benefit, or sharing part of the premium costs with our employees. So far we have chosen to continue paying 100% of employee premiums but that leaves us with the option to decrease the quality of benefit. Two years ago we were able to maintain essentially the same level of benefit by switching to Mercy Healthcare. They have been really good to work with and have offered very competitive options again this year. So we settled on roughly a 6% increase on our premium with slightly less coverage. Starting on January 1 we'll have to pay slightly more for some kinds of office visits, slightly more for some co-pays on prescription drugs and certain kinds of services, and have a slightly higher out-of-pocket maximum. Overall, I feel like we slid by with a relatively painless option for 2008. CMCA will pay thousands more for insurance this year but our employees will basically see the same level of service. But what about next year? Costs will continue to go up and we don't anticipate any meaningful increase in our federal funding. We're certainly exploring other ways to generate revenue but we also need to be thinking about cutting costs. Any guesses as to what the most effective way to decrease our health insurance cost is?

I'll talk about WELLNESS next time.