Hartford Business Journal

www.HartfordBusiness.com December 7, 2015 • Hartford Business Journal 5 Q&A Employers focus on health care cost shifts, wellness Q&A talks about changes in employer health benefits with Silas M. Warner, client advo- cate/vice president of Willis Group's human capital practice in Hartford. Q: What trends, cost and otherwise, are you seeing with employee- benefit programs? A: Medical cost trend continues to increase at a pace of about 9 percent. Phar- macy cost trend is even higher at 12 percent or more due to the high cost of specialty drugs. These increased costs are forcing employers to adjust either the value of the medical insurance product or to adjust the employer/employee contribution model. Whether it's through a traditional enrollment process or a private-exchange, more employers are offering ben- efit programs that include core and voluntary benefits. Employers are also starting to view the Cadillac Tax — a component of the Affordable Care Act that is set to go into effect in 2018 — as a factor in their medical-plan strategy. The Cadillac Tax is gaining attention on Capitol Hill as policymakers recognize that the tax could sig- nificantly impact a larger num- ber of employers than originally anticipated due to the continued escalation of healthcare costs. Another trend that ties into cost and over- all productivity involves employer-sponsored wellness programs. The industry is moving from a return-on-investment focus to a value- on-investment focus. Q: In 2014, the Society for Human Resource Management said the number of employers that only offer a consum- er-directed health plan (CDHP) was expected to surge by nearly 50 percent in 2015. Did that happen? A: There has definitely been an increased focus on consumer-directed health plans and we expect that trend to continue. CDHPs are designed to engage the member to take greater control of their healthcare and shop- ping decisions. According to the National Business Group on Health Large Employers 2016 Health Plan Design survey, 83 percent of large employers offer at least one CDHP. In addition, a third of respondents will offer only CDHPs in 2016. Q: Wellness programs have been a focus of large employers for a number of years. Have small and medium-sized businesses adopted them as well? A: We've found mid-size to large employers are more likely to have resources in place to manage a program or to hire a third-party wellness vendor. However, small and mid- size employers without dedicated staff are now also offering well- ness programs in much greater numbers. According to the Willis 2015 Health and Productivity Survey, 55.4 percent of employers with less than 250 employees offer wellness programs and 14.1 percent plan to offer them. For larger companies the numbers are higher. Regardless of size, many employers are including incentives for various participa- tory behaviors such as tobacco/ non-tobacco usage, biometric testing and health-risk assess- ments. Some are offering outcomes-based incentives for biometric numbers (blood pres- sure, glucose, cholesterol) and BMI. Q: How do employers view the com- pliance rate in their wellness programs? A: Using the 2015 Willis Health and Pro- ductivity Survey results again, 78.1 percent of employers with less than 250 employees said they were satisfied with participation levels and 68.6 percent said they were satis- fied with the business impact of their well- ness programs. Results also show 87.3 percent of employers with 250-500 employees said they were satisfied with participation lev- els and the identical number, 68.6 percent, said they were satisfied with the business impact of their wellness programs. The reality is that the higher the dollar value for the incentive, the more likely the employer is to see compliance. n PDS has been meeting the needs of the construction industry since 1965. Our dedicated team of design and construction professionals welcomes the challenge of serving its past and future customers on their most demanding projects. Trevisan Machine Tool | Suffield, CT PDS served in the role as Design Build General Contractor for the construction of a new manufacturing machine shop in Suffield, CT. Trevisan utilizes this new facility for aviation machinery and office space. The warehouse area is approximately 15,000 square feet and the office area is about 2,000 square feet. This is a pre-engineered metal building with metal foam siding panels. Fully designed to support owner installed 20 ton crane. 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