John Torinus sure thinks so. He’s the current Chairman and former CEO of Serigraph, a one thousand employee custom graphics manufacturer in West Bend, Wisconsin. In 2004, John began a successful mission to drive down the cost of health care at Serigraph – for his employees and the company – and even wrote a book about it named The Company That Solved Health Care. I’ve become a big fan.
If you run a company or are charged in some way with managing the health insurance plans, this book is for you. Serigraph has kept its costs virtually flat over the last ten years by following several key principles.
Even if you’re just like everybody else, and only a user of health care services, you’ll appreciate the moves Serigraph made to help its employees access quality and cost-effective care. Since implementing the initiatives spelled out in the book, Serigraph employees have seen no premium increases in most years and in some years a decrease.
Many of you are doing some of the things he details, but perhaps not all. Whether small or large, there are immediate opportunities to implement these initiatives.
- Adopt a consumer-driven health plan (CDHP). These types of plans started becoming popular in in the early 2000s and typically include a high deductible plan coupled with some type of personal health account, such as a Health Reimbursement Arrangement (HRA) or a Health Savings Account (HSA), to offset the higher deductible.CDHPs are key drivers in behavior. Study after study shows improved use of generic medications and more primary care visits by those in consumer driven plans. Very few employees will shop for price, service, and quality unless it means a difference in their pocket book. Serigraph experienced a 17% reduction in utilization. In 2012, our Benefits Benchmark Survey results showed that only 32% of area employers offered a CDHP. That means over two thirds of employers are shielding their employees from the true cost of care.
- Make it easy to access price and quality data. At our recent Human Capital Summit, Dr. Eric Bricker spoke about prices varying on some services by a 3 to 1 ratio! The book talks about (a) making this information readily available to your employees in a very simple format and (b) offering rewards to help them make the best decision. In one example, if a Serigraph employee uses a Center of Value for a knee replacement surgery, the company gives the employee $2,000. I had dinner a few weeks ago with a local health care CEO. He has spent a number of years running hospitals and health care organizations in larger markets and has been shocked about how little focus there is in our market on quality. I suspect that is true for many others.
- Bring proactive care to your employees.It starts with emphasizing convenient primary care. Avoiding unnecessary emergency room visits can have a huge impact on your costs. But you have to make it easier for your employees.One idea is onsite or shared “near site” clinics. Removing barriers to seek regular care is the key. It’s only going to get worse as Health Care Reform is fully implemented and more Americans begin accessing the health care system. Beyond cost implications, I think employers that offer primary care through work may ultimately have the biggest employee benefit of them all. Additionally, employers can use their “company doc” to provide a “medical home” where chronic conditions like diabetes, asthma, hypertension, and depression can be treated so they don’t become catastrophic claims. By the way, if you’re beginning to experience increased workers' compensation costs, think about how the improved health of your employees could lower the severity of comp claims. Additionally, you could use the clinic for rehabilitation and occupational health services.
That’s it – just those three initiatives, or “platforms” as John Torinus calls them. Of course implementing them and making it a part of your culture will determine your success. They didn’t seem like pie in the sky. They are actually very doable and many of you have already started down the path. As his website says:
“These are the major platforms for reining in health care costs. It is ground-up reform of the delivery system. It’s all about changing human behavior and engaging individual responsibility. No system can work without those key elements as foundations. Don’t delay; take these steps today.”
What’s The Risk?
First off, I encourage you to spend two hours reading the book.
If you’re a leader, take the bold step of gathering your team and setting a new course of action. Involve your consultant and insurance carrier. Get your key influencers together and figure out how you can implement the steps above.
If you’re just a consumer of health care, you can begin to implement these steps on your own, even if your employer has not. This year at open enrollment, don’t blindly enroll in the same old plan. Take a minute to review your options and understand how they will impact you. Shop for your care (when you can) for things like labs, scans, and planned surgeries. And focus on quality. The places with the best outcomes are often times some of the best priced.
Are you ready to try something a little different? What’s the risk in not? More of the same – something none of us can afford.
