by David Chapman
Staff Writer
For small and mid-size business owners, it’s not the property lease, utilities, office supplies or travel funds that tend to head the list of countless expenses. Instead, it’s about employees — whose salaries are generally regarded as the top expense — and their health care benefits.
The cost of health care has risen through the years and led to an increasing number of wide-eyed employees double-checking deductibles and looking over their coverages.
They’re not alone, as business owners feel the pain in their budgets, especially in an economy that’s caused pursestrings to be tightened.
“Employers are looking at health care expenses and what they need to do to ‘save jobs,’” said Larry Giusti, senior vice president of Harden & Associates, one of the largest comprehensive insurance, risk management and employee benefits firms in Northeast Florida. “It is getting more difficult to offset the cost of health care by the employer.”
While some small business owners have been hurt by the costs, providing health benefits boosts employee morale and tends to pay off, said Alan Guzzino, an accounts director with Harden & Associates.
Now more than ever, though, Guzzino said employers are looking at plans from top to bottom and determining what’s right for them.
Giusti has seen the trend, too.
“Employers have had to be creative in maintaining an affordable health plan for their employees,” said Giusti.
Creativity and technology have allowed employers to offer their employees multiple plans based on what Giusti said are “individual needs, risk appetite and budget” and allowed employees to choose on circumstances while employers save on fixed costs.
Another growing trend that Guzzino is seeing is the advancement of health savings accounts.
The plan’s higher deductible and lower premium along with an emphasis on preventative health care service has become more appealing, he said, though participants can find the higher deductibles unappealing at first. The first year, only 3–5 percent of employees typically enter into such plans, he said, followed by a leap to 50–75 percent in the second and third years offered. Additionally, a “sense of entitlement” regarding coverage has been rampant for decades, with costs rising all the while
“Unfortunately, health care is very, very expensive,” he said.
Even with higher costs, employers are still spending what’s necessary to ensure their employees are appropriately handled, such is the case for two businesses recently named as “Best Companies to Work for 2009” in Florida Trend magazine under the small business category.
“It’s one of our largest expenses ... costs are up, coverage is down, but it’s critical,” said David Miller, CEO of Brightway Insurance. “We view our associates as our No. 1 asset.”
Brightway offers its customers auto, home, business and life insurance but not health insurance — thus, it relies on another company to insure its own personnel.
While Miller doesn’t expect to see any changes in the rise in costs, as a small business owner he’s as hopeful as others.
“We’re all in this together (as business owners),” he said. “A long-term solution is what everyone wants.”
Like Miller, Clint Drawdy, president of health care staffing company Medical Methods, has felt the pinch. As Giusti, suggests, Drawdy’s been tinkering with ways to provide and save at the same time.
“You’ve got to be far more creative now,” said Drawdy. “You’ve got to starting thinking out-of-the-box solutions.”
He noted programs such as health benefit (debit) cards and urgent care clinics that could potentially save money as items he’s looking at for the upcoming open enrollment period.
Foot traffic inside the nine area Solantic Walk-In Urgent Care clinics has grown steadily over the past couple years, said Solantic Marketing Director John Ream, a trend that’s led to growth across the state. Two new clinics will open in September, he said, and there are 29 across the state.
“I think people are attracted to our business model,” said Ream. “Especially in this economy, it’s a great alternative for the busy, working families.”
The “menu board” as Ream refers to it, lists the procedure and set prices — meaning there are no additional fees or bills in the mail. The affordability, he added, means many people have the option to pay both out-of-pocket or use their insurance for procedures. Additionally, the business will unveil its own version of prepaid debit cards that can be used by employers in addition to or in lieu of more extensive coverages plans.
While creative alternatives make for more options, cutting out health care coverage altogether to cut costs has and won’t be an option, said Drawdy.
“Our employees are too valuable to us,” he said.
356-2466