Small businesses finding hands-on approach to benefits is key

Small businesses do have the ability to offer innovative employer-sponsored health plans that expand access to care while lowering costs for patients – just ask the six winners of the 2022 Health Plan Hero award.

Six small businesses from across the country are among the first companies ever to receive the national award, developed by the national nonprofit Patients Rising based in Washington, DC.

The winners revamped their health plans after routinely being hit with premium increases of up to 43 percent – and in some cases, even higher – “and they were not sure where that money was really going,” says Terry Wilcox, co-founder and executive director of Patients Rising.

“But now they have a transparent health plan, knowing where the dollars they are spending go, and also making sure their employees are getting great care,” she says. “It’s a more hands-on approach – that’s the key.”

One of the award recipients, John Soules Foods in Tyler, Texas, was facing increasing specialty drug costs and increasing claims cost year over year, as well as thousands of dollars in cost-sharing by patients before the plan coverage kicked in.

Starting in January 2019, the company switched to a benefit design that rewards patients who use a relationship-based direct primary care (DPC) program to help with provider selection, second opinions, scheduling, care management, specialty medications and clinical support. Patients who access care by partnering with the DPC program have their cost-sharing reduced to zero in most cases.

This process is managed by a “transparent, unconflicted” benefits advisor and her team, who designed the plan around the goals of both the employer and its employees and no other interests. The plan uses “independent, unconflicted, transparent and high-quality” vendors for third-party administration, pharmaceutical benefit management, specialty drug sourcing and local, custom-built network of high-quality providers.

In the first two years of the plan, John Soules Foods saved 35 percent on its claims cost and 20 percent on its fixed costs, while eliminating or dramatically reducing patient cost-sharing.

Another winner, Schaefer Autobody in St. Louis, Missouri, was recognized for its health plan that created a custom-built network of direct contracts with the local hospital systems, which resulted in no cost-sharing for care received in-network – and has saved the company nearly $1 million in its first year.

Other award recipients include Kenny Pipe and Supply in Nashville, Tennessee; Matheny Motors in Parkersburg, West Virginia; Shine Solar in Rogers, Alaska; and Woodard Cleaning and Restoration, also in St. Louis.

In addition to expanding patient access to care and lowering their out-of-pocket costs, the six award-winning health plans are also able to lower employer spending.

How can other small businesses achieve similar results?

Employers should work with an independent benefits professional, Wilcox says, preferably one who is Health Rosetta certified, or who operates according to similar principles.

“Such professionals don’t receive compensation based on how much a plan costs an employer,” she says. “Instead, they often receive compensation based on how much they save an employer – a reverse incentive.”

Secondly, employers should make sure they are granted access to all of the vendor contracts to identify any conflicts of interest within a health plan or other provisions that disadvantage the employer, she says. 

“Finally, employers should always remember that health care is local – especially for a lot of small businesses,” Wilcox says. “They can make deals with hospitals in their communities, and they can also make sure employees have access to the best specialists if they have chronic or rare health conditions.”