Health care costs have been increasing at a significantly faster rate than wages, economic growth, and inflation for decades. The cost pressures leading to these price increases include greater demand for healthcare from an aging population, obesity, the availability of advanced procedures and medicines, fragmented care, cost shifting, etc. Since the passing of the Affordable Care Act (ACA) in 2010, there have been additional cost pressures through requirements on what health insurance must cover and how much it can cost.
In response to health care cost increases, most employers resort to tactics such as increasing deductibles, coinsurance, and going out to bid in place of using a strategic approach to cost control. These tactics address only the symptoms of health care cost increases rather than the underlying causes. In contrast, MCG has successfully used the following strategic approach to cost control in order to keep increases in its clients' annual health care costs significantly below the national average:
MCG's strategic approach is most effective with organizations that have 150 or more employees. First, 150 employees is about the size that the cost of benefits consultants, who are paid directly by the job, becomes less than the cost of brokers, who are paid a commission based on the cost of health benefits offered. Second, organizations with 150 or more employees have tactics available to them that smaller employers don't have.
Through actuarial risk assessment and plan management, MCG is able to address the causes behind health care cost increases and thus control premiums rather than pass costs on to employees. As a result, MCG's clients have seen increases in their health care costs that are roughly half of the national average-saving these employers millions of dollars.
To read more about MCG's strategic approach to cost control, see:
Cost Control Strategies in an ACA World, Part 1: Strategies vs. Tactics
To learn more about how cost control tactics vary by organization size, see:
Cost Control Strategies in an ACA World, Part 2: Which Tactics are Right for Your Organization?
MCG recognizes open enrollment season can be a hectic time however, it is important for employers to remember their COBRA responsibilities as the new plan year approaches. COBRA qualifiers still in their election period and current COBRA participants must be given the same open enrollment options as similarly situated active employees. If you have a third party handling your COBRA administration, they too must be informed of changes in plan offerings and rates. Here are a few tips to help your company stay on top…
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The IRS recently released the 1094-C/1095-C forms and instructions to be used for the 2017 Applicable Large Employer (ALE) reporting . While there are only minimal changes to the forms this year, there are indications that the IRS will be more strict in its enforcement of the reporting requirements and the penalties associated with the employer mandate. In addition, the IRS recently announced that it will reject individual tax returns if the taxpayer fails to indicate the health coverage status for all individuals included on…
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