Most of the time, Tim White isn’t particularly effusive, but hit on the subject of how he keeps healthcare costs down at his company, Maclean-Fogg, and the words rain down in bucketfuls.
“You can cut me off, because people tell me I tend to be a little overly passionate on this stuff,” says White, who is the corporate benefits manager for the $1 billion+ manufacturer of vehicle components and power systems products.
Formerly a consultant to Fortune 500 companies on compensation and benefits, White was brought in to Maclean-Fogg in 2009, when the company decided to go self-funded on its healthcare benefits. Since then, healthcare costs at the company, headquartered in Illinois, have risen 7.5% total—when, for most companies of that size, 7.5% per year is more the norm.
White and Kristen Malbasa, Maclean-Fogg’s vice president of human resources shared their secrets for keeping the overhead reasonable, without passing costs on to employees.
“We don’t believe in cost-shifting,” says White. “What we’re big on is controlling the top number—what the total dollar is going to cost." The employee share of the premium is 28%, up from 24% in 2009, and “a lot of that has to do with employees shifting to higher-deductible plan and health savings accounts,” he says.
To get started, White mapped out a five-year plan for Maclean-Fogg to manage its self-funded healthcare. “This is a $20 million spend for us, so somebody better be managing it,” he says.
The first task at hand: Much simplifying. Acquisitions and expansions over the years had the company juggling 39 different plan designs. White pared that down to six across all of its operations: three union, three non-union. “There was a lot of head-scratching,” White says. But most plans were so similar—maybe $100 difference in deductible but nearly identical in design—that he was able “to take the ones that matched the closest and start to knock ‘em off.”
BlueCross is the company’s insurer—for now, it has the best network of doctors across Maclean-Fogg’s footprint. But White says he’s constantly running claims through other systems—Cigna, United Healthcare, Aetna—to keep tabs on which PPOs have the best discounts and physician access.
Establishing On-Site Clinicians
As part of the plan, Maclean-Fogg brought on wellness clinicians for each of its locations. These RNs and nurse practitioners, some with occupational credentials, work from a few hours a week at smaller locations to full time at the largest sites. A third party employs them, to comply with HIPPA law preventing employers from having access to employee medical records.
They do routine bloodwork and treat minor ailments (if they’re nurse practitioners, they can write prescriptions), cutting down on missed work time and improving productivity. “There’s a savings that’s associated with it—that if an employee isn’t feeling great, they’re able to see the nurse practitioner to be diagnosed and determine whether they need to go somewhere else and seek treatment,” says Malbasa.
The on-site clinicians are also the go-to people for employees with chronic health conditions who need things like regular blood pressure checks, or who just want to talk to someone about how they’re doing or ask for advice. If an employee needs an MRI or has to take a child to the hospital for a broken leg, a clinician can give them a quick cost comparison.
“It’s all about handholding in a time of need,” says White. “We know that employees are very complacent: ‘I take medical coverage because I have to.’ They’re not paying attention until something happens.”
During her first pregnancy, Malbasa checked in with the on-site nurse practitioner weekly. “I had a lot of questions,” she says. “So every Wednesday, we’d talk. Sometimes she just checked my blood pressure, and we talked about multivitamins and all of that fun stuff. It was very helpful having her to talk to between my regular doctor visits.”
Using Data Analytics
Through an outside firm, USI, Maclean-Fogg aggregates data from employee biometrics, medical and prescription claims and health-risk assessments, and applies it to identify health trends among its employees and predict potential problems. White says it took him three or four years to find the right vendors and consultants and build a good database. “I want to manage the consultants,” he says. “I don’t want the consultants managing me.”
He wants to understand what’s being spent, and more importantly, what’s going to be spent. Meaningful analytics will give you information about your population’s health that will help you predict what will happen in the future, White says. “And from that, you can start making decisions on stop-loss coverages, plan designs and those type of things."
The analytics, for instance, tell him that a disproportionate number of employees are diabetic at Metform, Maclean-Fogg’s auto components site in Savanna, Ill. Or that at another site, hypertension is a problem. Armed with the data, the company and its clinicians can build site-specific programming around particular risks. And, sometimes, give site managers a wakeup call.
“We get all this data and start feeding it to the locations, and the next thing, they go, ‘Holy cow!’ and they’re changing their vending machine locations, and the food that they bring in for their lunch meetings significantly changes,” says White.
A recent look at the numbers revealed that a whopping 70% of Maclean-Fogg employees had had a prescription for opioids in the past 12 months. White says they’re still figuring out what exactly to do with that bombshell.“We questioned our HR managers at the locations, and not one employee has come forward and said, ‘I can’t run my machine today because I’m on this drug,’” he says.
Not that they’ve been idle in trying to address the problem: A recent company wellness newsletter was devoted to opioid addiction, and other plant literature and lunch-and-learns have tackled the topic. White and his team are also working with HR people at the plants to make sure they understand “what happens when an employee comes forward and says, ‘Hey, I’m on this drug for the next couple of days—can you give me something other than a machine to run?’”
Another telltale piece of analytics: How many plan members are on diabetic medication, versus how many people are purchasing insulin testing strips (through their Rx plan). According to the numbers, many diabetics weren’t testing. “Based on that, I had my pharmacy management company [Envision Rx] do a mailing and start surveying those folks: ‘Why don’t you test?’” says White. He had been thinking about offering the test strips for free, but changed his mind when the survey came back saying cost wasn’t an issue.
Tying It All into a Wellness Program
The on-site clinicians, the company newsletter, the analytics, the lunch-and-learns—they’re all part of the companywide wellness program, You+. In exchange for premium discounts, employees have their biometrics tested and go online and do third-party health risk assessments. They sign a waiver allowing the clinicians to coach them on the assessment results.
Other wellness activities include Biggest Loser-style competitions, walking groups, gym discounts, health fairs and visiting nutritionists.
“We don’t usually reward people for results,” says White. “We reward people for participating.”