Are your healthcare costs causing a financial burden for your credit union?

By Diane Peralta
LEVERAGE Benefits Group

With double digit increases year over year, small to mid-size credit unions are faced with shouldering a larger financial burden when providing health care coverage to their employees. Many employers are responding by shifting higher costs to their employees which limits their ability to recruit and retain top talent in today’s heated job market.⁽¹⁾  Studies show the health benefit cost share is rising two times faster than wages.⁽²⁾  At LEVERAGE Benefits Group (LBG), our employers are telling us that health benefits are typically their second largest expense behind payroll. In most cases, those increases come without indication, justification or data.

Facts show that 98% of employers with more than 1,000 employees self-fund their health insurance. Self-funding is one of the most cost-effective ways for employers to control their healthcare spend. The principal aim is to improve the company’s operating expenses by controlling and reducing the claims and premium cost. When you take on a portion of the responsibility and risk of a self-funded plan, you stand the chance of saving. If the total claims cost is lower than expected, you will retain the savings and can earn interest on your reserve, unlike with fully insured where you will continue to pay a set monthly premium and any savings will remain with the insurance carrier.

Living and working through a pandemic has brought this to view even more as most all elective services have been delayed or even canceled all together. Why pay a set monthly premium if your employees are not using the benefit? In the self-funded world, these savings remain in the credit union’s pocket.

With self-insured plans unlike fully insured, you have flexibility with plan designs, the ability to implement cost containment programs and products that not only drastically reduce your long term health care cost but in tandem can improve the health of your employees and their families.  You have complete transparency on your claims reporting. This transparency allows us to proactively work towards assisting your employees with choices, better quality care and potential savings for both the credit union and the employee. Talk to us about using one particular program, which will give credit unions of even 20 employees, the buying power of a larger employer.  One of many programs available to our credit unions.

We offer a variety of medical solutions tailored to fit each credit union with the ability to combine large employer buying power but offer individualized flexibility that you will need. We will work closely with your team to review your portfolio of benefits, keeping them just as they are or tweaking them to be more attractive to your employees. Regularly, we have in-depth conversations based on the complete claims data analysis weaving in strategic cost containment recommendations to help optimize your benefits and control cost. Education is key. We will ensure your employees are engaged and knowledgeable to make the most of the benefits they are provided.

If your healthcare spend is getting out of control, we encourage you to reach out to LEVERAGE Benefits Group for a consultation.

LEVERAGE Benefits Group is a partnership between Salus Group, a benefits and administration CUSO, and LEVERAGE. LEVERAGE Benefits Group is laser focused on employee benefits and we will work with you to create a total solution specific for your credit union needs providing enrollment administration, consolidated invoicing, ACA reporting, COBRA, Compliance services and much more! With more than 200 credit union clients, we know your culture and we are here to help.

1. Analysis of kaiser/Hret employer health benefits survey and bls data.
2. kff employer health benefits survery, 2018-2019; kaiser/hret survey of employer-sponsored health benefits, 2009-2017.