With so many employee health plans to choose from, how can a company know it’s choosing the right one? That question was put to three Puget Sound area benefits brokers—called producers in Washington—who were asked to compare three local carriers: Regence, Premera, and Group Health (now Kaiser Permanente).
Meet the Producers: Health plan experts
• Monica Cripe is vice president at Seattle-based Sprague Israel Giles. Inc. (SIG). The firm’s employee benefits department has a client base ranging from small employer groups to 6,000-employee organizations. SIG has particular expertise in school districts and nonprofit organizations.
• Steve Bean is principal at TRUEbenefits in Seattle. TRUE has 75 large group clients, from 100 to 3,000 employees in size. Industries represented are diverse and clients include Nintendo and Point B.
• Kristen Brace is an area vice president with Gallagher Benefits Services in Bellevue. Gallagher works with more than 500 large group clients, ranging from 50 employees to 5,000. Industries supported include tech, transportation, health care, education, and pubic sector.
What employers want
1. Local over national. “We do business with all the health insurance companies, but generally our clients tend to lean toward the local big three: Premera, Regence, or Group Health,” reveals Cripe. “For a small group market in particular, some of the national carriers don’t devote as many resources to customer service as the local companies do for clients.”
2. Lower costs and value. “Cost is never off the agenda,” says Bean. “If it’s not number one, it’s number two.” Adds Brace, “Smaller companies tend to be more price sensitive, larger ones more often seek value. Things like a willingness to educate employees on ways to improve health and reduce costs. Or using claims and utilization data to fine-tune plan design and engagement.”
“There have been some years when a carrier might discount rates to generate new business,” discloses Cripe. “At times we might take advantage of this for our clients if the fit is right. We make sure clients know of those opportunities, along with the associated risks—in the short term there may be money on the table, but a reckoning sometimes comes when the carrier is hoping to renew with normalized rates.”
3.Higher-value networks. “Companies seem to be looking at narrow networks or higher-value networks, similar to the Accountable Care Organization concept,” notes Bean. “There are potential savings depending upon the suitability of the network for the workforce. Other companies are taking new approaches to funding, such as ‘captive,’ where a number of employers join together to self-fund as a group.”
“One trend on the horizon deals with value-based compensation,” says Brace. “Federal health officials have a plan to shift some $350 billion into accountable care type contracts with the potential for rewards based on care quality and better outcomes. That’s something Group Health has been doing for years.”
3 WA state producers compare local health plans: @GroupHealth, Premera & Regence. Important info for large employers http://ctt.ec/qe1rZ+
The local big three: Strengths and challenges
Employer health plan costs depend largely upon their employee makeup and the combination of copays, deductibles, and coinsurance selected. While the local three health carriers offer much the same benefits, how they go about it differs. However, certain carrier strengths—and challenges—stand out.
Group Health (now Kaiser Permanente)
“Some buyers and customers still have 20-year-old misconceptions about Group Health,” says Brace. “But with their new Access PPO product, they’ve become very competitive with the BUCAs (Blues, United, Cigna, Aetna).”
Cripe agrees. “With their new Access PPO plan designs, Group Health is unique in the market. They’re able to offer Group Health Cooperative (an HMO), the Access PPO network, and an overlay of the First Choice network—all as ‘in-network’ providers. This gives employees and family members a very broad selection. In addition, if members decide to use services at Group Health clinic locations, they receive reduced cost-shares, with proven quality advantages.”
“Now that Group Health offers a PPO, they’re very much on par with Premera and Blue Shield in terms of provider choice,” notes Bean. “And with their own medical centers available through their HMO, they’re especially credible for western Washington employers.”
“Group Health renewals are methodical and predictable,” observes Brace. “But that means companies rarely face surprises.” Bean concurs. “They are consistent. I find that they’ve been a good long-term partner for human services companies and nonprofits.”
“For our clients, flexibility is important—not only with products, but also with things like administrative procedures and eligibility structures,” relates Cripe. “With the new Access PPO products, we’ve found Group Health to be a great fit for many of our groups because of the combination of a large network, broad plan designs, and flexibility with employers.”
“From our point of view, Premera offers a wide variety of plans, some of which offer very comprehensive coverage on medical and prescription drugs,” says Cripe. Bean agrees, saying, “They offer a good product mix and are often flexible in terms of pricing. Plus, there’s a level of brand comfort associated with the blues.”
“I find that their account managers are more empowered than others in the industry,” states Brace. “Premera has made investments in member experience with transparency tools and updated member technology. However, they’ve had some tough times: the cyber breach, recent layoffs, proposed individual rates are higher than ever, the breakdown in the Swedish/Providence negotiations. You never want to see a company have trouble but at the same time I need to keep my clients informed.”
For Bean, Regence and Premera are alike in many ways. “The blues are similar with their plans, networks, doctors, and hospitals. Plus, they offer plan and underwriting flexibility for larger groups.”
Cripe points out one area in which they’re different: “Regence gives purchasers a wider choice of plans they can offer in a given plan year—three to five within one group. They’ve also introduced newer ACO (Accountable Care Organization) products allowing companies to offer plans with designated groups as their in-network providers. This saves employers in premiums, and provides a more integrated approach to member care.”
For Brace, Regence could improve their approach to renewing policyholders. “They’re driven by underwriting right now. They need to be equally market-driven to attract and renew clients. Also, they need to invest in member experience. For instance, they’re just now launching a member app for iPhone and don’t yet offer one for Android.”
Kaiser Permanente Value
Kaiser Permanente has long been operating like an ACO, offering its own network of doctors and partnering with other networks and hospitals to offer employers a high-value option. Our Access PPO plan is the top-rated plan of its kind in Washington,1 with one of the broadest network of providers in the state. Our commercial HMO plan is a great low-cost care option for your employees. And it has been rated the top-performing health plan in Washington—and the country.2 With both plans, your employees can access Group Health Physicians (now Kaiser Permanente Physicians), the highest-ranked medical group in the state.1
We offer self-funding options to large companies and our Plan Performance Profiles use employee data to help companies optimize the health coverage they provide. Kaiser Permanente members are able to make appointments, email their care team, refill prescriptions, check their tab and test results, and more—all online.
1. 2016 Community Checkup, Washington Health Alliance, as Group Health Options, Inc.
2. 2016 eValue8 Report, Washington Health Alliance, as Group Health Cooperative