Case Studies

New Benefits Strategy Leads to Significant Savings

Situation

This client is logistics company with 400 employees on their plan. Their benefits and health insurance strategy was founded on traditional co-pay plans, so they were fundamentally against high deductible plans. As their health care costs began to rise, our consultants worked together with their new HR Director to add alternative funding strategies to their current product portfolio.

Solution

We implemented a High Deductible Health Plan (HDHP) paired with a Health Saving Account (HSA).

With an HDHP paired with a HSA banking arrangement, instead of paying higher premiums to the insurance company, you can put the money into your HSA to self-fund future healthcare expenses. The true advantage of this combination are the tax advantages that it offers standard employees.

Your HSA is a personal account that offers employees triple tax treatment. That means it is tax deductible going into the account, accumulates interest-free and is never taxed if used on Qualified Medical Expenses (QME). QMEs expand from medical to dental, vision, and a wide range of items available on the HSA store.

This company also offered an employer match to the HSAs of employees who elected the plan, choosing to invest even more in their employees to show how much they care.

Result

This strategy enabled them to save money as well as aligned with their financial goals. With the HSA, we introduced medical consumerism into their workforce which in turn creates more favorable claims experience.

Over the last two years that the plan has been implemented, the companies renewals decreased than years prior and the actual cost of the HSA option decreased as well.

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