The popularity of employee benefits plans is causing premiums to rise. Employees value the medical, vision and dental coverage of a benefits plan and this is often reflected by regular claims. While active usage of a plan attests to its success, clients want to make sure costs don’t skyrocket either. Companies are looking for tips on how to keep employee benefits costs down, without altering coverage.
So, here are three industry pointers that we like to share with our clients. This advice also helps employees save on out-of-pockets expenses when they are sharing some plan costs with their employers.
Offer an Approved List of Low-Cost Pharmacies – Within the cost of a prescription, there is the drug’s cost and a dispensary fee from the pharmacist, and many are unaware that both of these costs can vary greatly from pharmacy to pharmacy. The very same prescription can either being less or more expensive from one pharmacy to the next. This is due to many factors including location and service offering at that particular pharmacy but is ultimately determined by the pharmacy setting its own profit margins. Therefore, identifying more economical pharmacists and providing a list of these pharmacists to employees can significantly lessen the total cost of medical claims for an organization. This in turn minimizes the possibility of rising premiums on renewal. This list can also benefit the employee who might have to pay anywhere from 5-50% of the expense out-of-pocket. The list could also include approved online pharmacies. For example, mypharmacyonline.ca offers the same savings as low-cost brick-and-mortar pharmacies, and also provide the added convenience of to-the-door delivery.
Employees might also want to opt for generic brands of a specific medication, instead of brand names which are commonly prescribed. FDA-approved generic brands have the same active ingredients than brand names. While some insurance policies stipulate that it covers up to the cost of generic drugs under the extended health plan, some do not. So it’s important to educate employees about the various requests that are possible and savings that are available when fulfilling prescription drugs.
Keep Up-to-Date on Online Vision Care Services and Affiliations – Generally speaking, employees are allocated an average of $250 for vision care annually. This can be complemented by a health spending account to cover any additional expenses. However, just like medications, choosing lower-cost or online providers for eye exams, glasses frames and contact lens prescriptions can help keep costs down. Some insurance providers are also affiliated with specific optometrists, and glasses and contact lens suppliers, offering upfront discounts to employees. Our team at BenefitDeck works with clients to ensure they are up-to-date on the latest savings and discounts available to their employees. It’s all part of the hands-on service that we offer which helps our clients get the most from their employee benefits plan.
Provide Dental Fee Guides as Benchmark for Service Costs – Like pharmacists and optometrists, dentists are inclined to set their fees according to the level of service they feel they provide. One dentist can vary greatly in price from another for the same work. While it’s up the employee to decide who they prefer to have cleaning or working on their teeth, it’s important to make them aware of the provincial dental fee guide. The fee guide provides a benchmark for the costs of specific dental services, which helps employees identify when they are dealing with a high-priced practitioner. A general rule of thumb that we advise is to verify the fee guide for any major work over $200.
In certain cases, it is also wise to submit the claim prior to having the dental procedure done in order to verify what percentage of the costs will be covered. This protects the employee from any surprises, and also acts as another way to vet rates. Insurance companies have their own fraud departments that might be able to recognize when a claim looks financially suspicious. Finally, while second opinions are not necessary, it’s always prudent to shop around. Dentists, like doctors, can differ in their assessments and treatment plans, so taking your oral health into your own hands is always advised.
When All Else Fails, Consider the Flexible Benefits Plan
While all of these tactics can help clients and their employees curb medical, vision and dental-related expenses, avoiding rising premiums can still be difficult when plans are very successful. At this point, more budget-friendly options like the flexible benefits plan might be worth considering. Not only does it provide greater flexibility of choice to each employee in terms of selecting the types of benefits and level of coverage they prefer, but also helps employers to stick to budgets and avoid renewal rate inflation. Learn more about flexible benefits plans, or contact our team to discuss other cost-cutting measures.
Whether you are with a business, association, or owner operator, we have the solution for your needs.