The only thing we can be sure of when it comes to American health care policy is uncertainty itself.
As of this writing, the first few attempts to “repeal and replace” the Affordable Care Act (aka Obamacare) have stalled. Meanwhile, health care costs continue to rise, and the Trump administration is talking about reducing federal subsidies or (possibly) repealing or limiting the tax-deductibility of employer health benefits.
If you’re the person at your office in charge of talking about (or even choosing) medical insurance benefits, all of this uncertainty presents two very different but important challenges: How to communicate with staffers about their anxieties around medical insurance benefits; and how to decide what medical benefits your office can afford to provide.
For the foreseeable future, your company is likely to face annual changes in deductibles or services covered as your human resources department and CFO struggle to keep costs manageable, keep everyone up-to-date on the changes, and keep employees motivated to work toward shared goals.
To find out more about the nuances of this task, The FruitGuys spoke to Cabot Brown, the CEO of Carabiner LLC, a San Francisco–based financial advisory firm specializing in health care, education, and sustainability. Brown has dealt with this situation both as a health care industry consultant and as the leader of a small firm who’s had these discussions with his own employees.
Communication Is Key
In a large firm, Brown notes, benefits will be determined by the HR department or union agreements. Your task is to communicate the details as clearly and honestly as you can, and help staff deal with anxiety and any difficult choices they have to make. “It’s essential to explain [the choices involved] to your staff, perhaps in a group meeting. A lot of employees don’t know the costs, the financial situation. It’s very helpful to tell them something like, ‘We have $4 million in revenue, and we’re spending 8 percent of our total revenue on your salaries, 6 percent on health care, and only 4 percent on raw materials.’”
That honesty goes both ways. You want to make sure to fully communicate any changes in benefits to your staff, but another key part of getting through hard times is making sure HR and upper management know how their decisions are affecting your staff’s productivity. Keeping everyone in the loop is crucial, because if your firm cuts back or eliminates health benefits, you may lose good staff.
Health care benefits also provide a unique opportunity to improve the bond with your staff. Brown notes that staff may talk to you privately to share particular concerns. “You don’t always know what’s going on in people’s lives. They might come to you quietly after a meeting and say, ‘You know, my son is severely sick with diabetes and I need this type of care.’ And if you find a way to address those concerns, it goes miles to ensure loyalty.”
When You’re the Decider
When you’re involved in determining the level of benefits, the choices get extremely complicated. Costs keep rising, leaving employers with the choice to spend more (at the expense of profits or wage levels), to cut back the areas covered (by eliminating things such as optometry or dental coverage), or to increase the deductions and copays that employees pay even for covered expenses.
All of the choices are difficult and will likely upset people. The best solution is to communicate as clearly as possible: tell your staff how difficult the choices are for the company, and find out what your workers prefer in terms of trade-offs. Some workers may be happy trading vision care for alternative treatments such as chiropractic care and acupuncture; others may welcome a higher copay or deductible for access to more services. You need to know what they prefer.
Even if there are no good choices, employees will be happier if you’ve taken their preferences into account. Staff buy-in is crucial and helps emphasize the fact that you’re all in it together. Brown suggests including your staff in the decision-making: “Here are the six options we’re considering. This one has the lowest deductible and this type of care. This one has the highest deductible and this type of care.”
Brown also recommends working with an insurance broker and picking a local one. “All health care is local, so I wouldn’t ever hire a ... big national firm.”
However the political wrangling turns out, there are a couple of things we can be certain about.
- Helping your staff live a healthy lifestyle is a win-win strategy. It increases productivity while lowering medical costs. Resist the temptation to bring donuts or other unhealthy snacks to meetings; offer fruit instead. Consider starting a weekly running or cycling group, and encourage staff to commute by bike or on foot.
- It’s crucial to be honest with your staff—and that includes admitting what you don’t know. Make sure you don’t promise something you might not be able to deliver. It’s a mistake to say, “Don't worry about us dropping health insurance,” unless your HR department is willing to guarantee that they won’t. Be as clear as your management will allow about the financial challenges involved and the difficulty of predicting the future.
You can’t determine what the future will hold, but one thing is certain: you can build trust with your staff by being as open as possible about the costs and difficult choices involved in health benefits, and by involving them in the decisions whenever possible.
Mark Saltveit writes about science and health, Taoism, palindromes, and football. He’s the author of The Tao of Chip Kelly and Controlled Chaos: Chip Kelly’s Football Revolution.