Manage Healthcare Costs Through Health Savings Accounts

Tam Harbert -- Expert Business Source, 4/12/2007 10:10:00 AM

With yet another rise in health care premiums looming this year, small companies are taking a hard look at health savings accounts (HSAs), which pair a high-deductible health plan with a tax-free savings account for medical expenses. To get the most from this type consumer-directed healthcare, employers should first take the time to educate their employees about the costs of healthcare and how to be cost-conscious healthcare consumers.

That was the consensus of a panel of small-business CEOs and human resources executives held recently by the Small Business Council of the Consumer Electronics Association in Washington, D.C. The panelists offered these suggestions:

Be transparent about your costs. “The first thing that employees need to understand is how much the company pays and how much the employee pays in supporting a benefits plan,” said Emmitt Summers, vice president of human resources at BDS Marketing Inc., a company that focuses on merchandizing, sales and development for retail and employs 200 people.

Being open about costs will help employees to recognize that they have “equal skin in the game,” Summers said. In other words, the steps that both employers and employees take in reducing costs can benefit both sides.

Lead by example. It’s important not only to make employees aware that they have some responsibility for the cost of healthcare; employers must also show them what they can do to control it, said Judy Kennedy, vice president of human resources and administration at high-tech startup Ibiquity Digital Corp., which has 110 employees.

About 18 months ago, Ibiquity launched a healthcare initiative that includes a “health awareness” week held at each of its three locations. During the week, the company offers free services, food and consultation to help employees make good healthcare decisions. “We try to get people to think out of the box and try things they would not normally do,” says Kennedy. The week can include the following:

• healthy snacks, such as fruit or natural peanut butter
• lectures by nutritionists and healthcare providers
• exercise classes
• individual health assessments, including checks of blood pressure, cholesterol and body mass index
• massages
• personal pedometers so employees can track how many steps they are walking

BDS Marketing also gives wellness-related freebies to employers. Perks include free oatmeal to encourage food that lowers cholesterol, health and wellness seminars, an in-house gym, free massages and incentives to stop smoking, said Summers.

Work with partners. Ibiquity found willing sponsors to contribute to its healthcare weeks. The company’s insurance carrier provided some of the health assessment services and directed employees to useful online health-management tools on its website. Ibiquity also brought in nutritionists from local hospitals and instructors from local health clubs, who in some cases also offered employees significant membership discounts. The costs were negligible. “You’d be surprised who you can get to come in for an hour to give a lecture or run an exercise class,” said Kennedy.

Tam Harbert is a freelance writer based in Rockville, Md.