Keys To Managing Rising Healthcare Costs

The Role of Brokers in Managing Healthcare Costs

Jason Hamelin, Director of Financial Planning and Analysis at Werfen, highlights that a strong partnership with brokers is critical for managing healthcare costs. By maintaining regular communication, companies can stay informed about high claims and emerging trends, which helps finance leaders make better decisions during annual enrollment. Brokers also play a key role in educating employees, offering guidance on how they can save on healthcare while reducing company expenses.

Rising Healthcare Costs and Their Business Impact

With healthcare costs expected to rise by 8% in 2025, Hamelin explains how this increase can have widespread effects on businesses. The rise in expenses often leads companies to rethink their employee benefit packages, increasing premiums and out-of-pocket costs. This can lower employee morale and even increase attrition rates, particularly in industries where companies pride themselves on treating employees as key assets. Additionally, rising healthcare costs can force businesses to divert funds from critical areas like research and development, potentially slowing innovation.

Balancing Cost and Employee Experience

For companies, the challenge is finding the balance between managing costs and providing a positive employee experience. By offering high-deductible health plans and health savings accounts (HSAs), employees can reduce their tax base while preparing for future medical costs. Telemedicine is another solution that helps employees save on minor medical expenses without paying deductibles or copays.

Long-Term Cost Management Through Self-Insurance

One of the most successful cost-containment strategies has been transitioning to a self-insured model. This shift has allowed the company to save 30% on healthcare expenses by adopting a reference-based pricing plan, which ensures long-term savings for both the business and its employees. By taking control of their healthcare plan design, the company has not only managed costs effectively but also protected the overall employee experience.

Jason Hamelin’s insights offer a valuable perspective for any finance leader looking to navigate the complexities of rising healthcare costs while maintaining a competitive edge in employee benefits.