Wellness Programs Can Help Small Businesses Reduce Healthcare Costs

Small businesses are among the hardest-hit by the rising healthcare costs. This makes them extremely motivated to find ways to get the most bang for the buck. Compared to individuals they have more tools on their disposal to shop around and maximize value.

WSJ offers an excellent summary of small business coverage strategies, putting wellness front and center

The piece is based on a recent survey of more than 500 employers and health plans, conducted by PricewaterhouseCoopers (PWC), a global accounting firm. PWC found that the healthcare costs for US employers are going to rise 10% in 2008, a staggering amount compared to the overall growth of the economy.

What were the top cost-containment strategies identified?

1. Discounts for Healthy Living
   The idea is to reward employees who commit to voluntary screenings with reduced deductibles and co-pays. While, small businesses lack resources to implement such programs in-house, insurers (like Principal Financial Group) are starting to step up the the plate with plans tailored for such programs.
2. Online Wellness
   These programs focus on giving employees access to online resources to assess, monitor and improve their lifestyle habits, especially related to diet and fitness. Programs like My Wellchoice+ go an extra steps to create monetary incentives for completing goals, translated into points and then cash.
3. FSA Debit Cards
   Flexible spending healthcare account adoption is growing for small businesses, because new programs, such as Sentinel Financial Group are finding ways to paperwork. FSA funds are typically applied to cover deductibles and co-pays.
4. Health Coaches and Advocates
   Navigating the paperwork of the healthcare system is a daunting task. Small business HR departments are rarely equipped to answer every question, but can draw on help from specialized firms. Groups like Health Advocate can help employees search for care options and deal with claims.
5. Disease Management
   The cost of just a few chronic care cases could be very significant to a small business. That is why prevention of specific diseases and their complications can really pay off. Prevention programs can put employees pre-screened for high risk conditions in touch with nurses to get them needed care upfront.
6. Nurse Hot Lines
   Minor health issues could lead to major and often unnecessary costs. Whenever people are anxious but unsure of the level of care needed they can run up significant bills in emergency rooms or urgent care. Pre-screening and education with nurses over the phone saves money on minor cases to focus on major ones.
7. Purchasing Cooperatives
   While not strictly a wellness program, pooling of small businesses into larger groups gives them better access to available plans improving quality and cost of their coverage. Which in turn can mean adding more prevention and wellness programs to the shopping basket.

Overall, small business still need a lot of help in improving their employee coverage and well-being. Smart insurers will no doubt keep increasing focus on this market. Healthcare reform proposals need to pay closer attention to the needs of small businesses.