In our recently completed annual Keenan HealthCare Benefits Strategy Survey of California health care organizations, the top four objectives identified by survey participants were managing cost, increasing use of their own facilities, offering competitive benefits and improving the health of the employee population.
As California and other states continue to see shortages in clinical health care professionals, this information offers insights into how organizations are responding. One piece of good news is that California hospitals, on average, have experienced a relatively low increase in per-employee medical benefits cost.
The research is now in its 15th year and provides important benchmark data for the health care industry in California, with implications for the sector nationwide. The Survey presents findings from 228 California health care organizations, making it the most comprehensive study of its kind. Using consistent methodologies and metrics from previous years, the Survey facilitates effective year-to-year comparisons of strategic results.
Here are three other key findings:
- Annual medical benefit cost per covered employee is $13,536.
- These organizations pay, on average, 91% of the annual cost of employee-only coverage for their most popular plan.
- Wellness programs are evolving from rewarding participation to rewarding activity and outcomes, while using technology to enhance participation and engagement.
A surprising finding from the Survey is that the California health care industry has not adopted high deductible health plans (HDHPs) as rapidly as we have seen in other industries. HDHPs only have a 2% share of enrollment in California health care organizations; and only 12% of California health care organizations plan to implement, or even evaluate, a high deductible full replacement program over the next three years.
The Survey has been very influential in health care organizations for decision making and developing their benefits strategies. Many utilize the data to identify leading-edge cost management programs. Those with unions use the data in their bargaining negotiations. Most apply the information for determining their annual contribution strategy. Finally, many organizations seek to improve the outcomes of their health management programs through refinements identified by the survey results across the state.
As the recruitment situation persists, offering competitive benefits is seen as a clear response. Yet keeping costs under control poses a difficult balancing act. And another challenge is addressing the varying needs and expectations of younger demographic groups as the employee population continues to age.
It’s a complex puzzle that we see our health care clients struggling with every day. But there are solutions through strategic planning, benefits management and “better practices” using the tools and programs implemented by the organizations achieving the best results.
About Steve Richter
Steve Richter is Senior Vice President of Keenan HealthCare and leads the research team that conducts the Keenan HealthCare Benefits Strategy Survey. For more information about the Survey, please contact him at srichter@maintenance.assuredpartners.com/keenan.