Case Study 2

The Organization
A technology company located in the Northeast, with 50% of their sales force throughout the country, has 147 employees and is evenly split between males and females. The average age is 48 years old. Of the insured, 60% are in the family tier, 17% with two-party and 23% with employee-only coverage. The company contributes 83% of the monthly premium to all tiers. The plan was a PPO with low co-payments and no deductibles for in-network medical or pharmacy usage – a very rich plan by current standards.

The Challenge
After a thorough review of the underwriting methodology, Bell Associates concluded the company had been over-insured and had to persuade the carrier that due to extenuating circumstances it should underwrite the company in an entirely different manner.

The Solution
To begin the underwriting process, Bell Associates recommended a below-trend increase – although it was still an increase on an already high premium rate. The team of Bell Associates presented the company with a Health Savings Account (HSA), a comprehensive plan that would reduce the premium by over $600,000. This enabled the company to fund 90% of the employees' deductive and still reduced the company's overall costs. The plan covers employees 100% once their deductible was met. Preventive care, well-visits and immunizations up to age 19, and well-women exams were covered – all were payable with a small co-pay.

The Results
For four consecutive years since Bell Associates became the technology company's consultants for Health and Welfare plans, the company has renewed their medical plan each year with an increase in the low single digits with no changes to the health plan. The total medical costs over the last four years resulted in an aggregate premium increase of less than 5% since Bell Associates became involved.

Since the inception of the HSA medical plan, the annual medical premium dollars plus the company's HSA contribution of 90% of the plan's medical deductible resulted in a combined dollar spending for the company well below the medical premium costs of a "traditional" medical plan and 83% of the employees ended the year with HSA funds still remaining in their accounts. The success of the program is attributed to the transparency of medical costs to the members, health and wellness awareness, and allowing members to control their personal medical utilization of healthcare on an individual level.