By Jodi Juretich,
Chief Financial Officer
You might be thinking, “What does healthcare costs have to do with a factory automation and equipment control software solutions company?” Well, directly, not much but indirectly, it’s one of many benefits that play a role in retaining and attracting talented employees.
Gone are the good old days where 100% employer paid benefits were the norm. The average health-care cost for a family plan now costs roughly $13,000 a year and employees are paying anywhere from 25% to 50% of that cost. Multiply that times the number of employees in your company and, well, you get the idea. And that’s only health care. There are other benefits such as life, disability, dental, vision and workman’s comp, to mention a few. According to the Kaiser Family Foundation’s 2009 Employer Benefits Survey, health insurance premiums have increased by 138% over the last decade. With increases like that, an employer has to be smart on designing health plans to keep their employees focused on their jobs and not stressing about how they are going to pay for health care.
Your typical health care plans have co-pays, out of pocket maximums and life time maximums and all of these options, depending on how they are designed, can drive the premiums way up. If your company is paying attention to these options, they can manage the cost by implementing a Health Reimbursement Account Plan (“HRA”) to supplement, for example, higher out of pocket maximums. A strategy like this is designed so the employee does not feel the financial burden if they fall in to that very small population of hitting their out of pocket maximum in a plan year. Why pay a higher premium that caters to the whole population when only a very small percentage will use that part of the benefit.This approach saves the employee money by reducing employee share of the monthly premiums. It saves the company money by reducing its overall expenses which directly impacts a company’s ability to maintain competitive pricing to its customers and ultimately drives the company’s EPS and shareholder value.
At Cimetrix, we take very seriously the retention of our key employees and understand that a competitive benefits package plays an important role in that process. Our team is our most valuable asset, providing you – the customer – with the highest quality support, services and solutions. With sound financial planning, we can create a program in which both the company and the employees win.
Next time your benefits are up for renewal, ask your employer if they have a financially smart plan design for healthcare costs.