{"id":1475,"date":"2021-11-17T21:36:21","date_gmt":"2021-11-18T03:36:21","guid":{"rendered":"https:\/\/www.bbrown.com\/?post_type=case_study&p=1475"},"modified":"2022-01-18T09:00:06","modified_gmt":"2022-01-18T15:00:06","slug":"helping-reduce-medical-plan-spend","status":"publish","type":"case_study","link":"https:\/\/www.bbrown.com\/uk\/case-study\/helping-reduce-medical-plan-spend\/","title":{"rendered":"Helping Reduce Medical Plan Spend"},"content":{"rendered":"

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Case Study<\/p>\n

\n Helping Reduce Medical Plan Spend\n <\/h1>\n\t\n <\/div>\t\t\t\t\t\n\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\n\t<\/div>\n\n\t\n[\/vc_column][\/vc_row][vc_row row_padding_bottom=”pb-2″ full_width=”stretch_row” equal_height=”yes” content_placement=”bottom”][vc_column width=”1\/4″][vc_single_image image=”791″ img_size=”full”][\/vc_column][vc_column width=”3\/4″]\n
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\n The Challenges\n <\/h2>\n\t\n <\/div>[vc_column_text]Plan cost up 39.5%<\/strong>
\n2016 to 2018<\/p>\n

Employer’s cost up 82.3%<\/strong>
\n2016 to 2018<\/p>\n

Recruitment& Retention<\/strong> increasingly difficult[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_padding_top=”pt-1″ equal_height=”yes” content_placement=”bottom”][vc_column][vc_column_text]Company Profile<\/strong>
\nIndustry:<\/strong> Automotive
\nEmployees:<\/strong> 1,000+
\nLocations:<\/strong> Seven dealerships in Dallas-Fort Worth and Houston<\/p>\n

In an effort to reduce spend on its medical plan, this large automotive dealer decided to move their medical plan to a Medicare cost plus strategy. This plan included no true insurance network and worked using back-end negotiations for payment. In theory, it would greatly reduce the cost to the employer. However, over time, the employer\u2019s cost continued to go up. The dealer also continued to increase deductible levels each year by $1,000 and reached a $6,000 deductible the year before the dealer began working with Brown & Brown Insurance.<\/p>\n

Not only did their medical plan become less beneficial, employees\u2019 contributions were increasing year-over-year by an average of 10%. Paired with the plan having no real insurance network, employees were constantly running into problems with the doctors and hospitals providing health care services. It was an administrative challenge for the Human Resources (HR) staff. When the hospitals would agree to provide services, members regularly had to balance bills on the back-end, which sometimes led them to be sent to collections and in some cases, court battles.[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_padding_bottom=”pb-2″ full_width=”stretch_row” equal_height=”yes” content_placement=”bottom” css=”.vc_custom_1638896243466{background-color: #eaeaec !important;}”][vc_column width=”1\/4″][vc_single_image image=”794″ img_size=”full”][\/vc_column][vc_column width=”3\/4″]\n

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\n The Solution\n <\/h2>\n\t\n <\/div>[vc_column_text]<\/p>\n

Lower employee contributions & focus on addressing the company\u2019s large claimants.<\/h3>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_padding_top=”pt-1″ full_width=”stretch_row” css=”.vc_custom_1638896256859{background-color: #eaeaec !important;}”][vc_column][vc_column_text]The ultimate breaking point came when an employee with cancer was scheduled for surgery to have a tumor removed. The day before the surgery, the hospital called and let the employee know the surgery was canceled because the insurance did not have a network.<\/p>\n

Brown & Brown began providing guidance to this automotive dealer in the summer of 2018 and approached health care methodology with a different way of thinking, different cost-savings strategy and a true national network.<\/p>\n

Rather than shifting costs to their employees, Brown & Brown lowered employees\u2019 contributions and dropped their deductibles to $1,000 in the first year. After strong results in the first year, the deductible was dropped to $900 in year two. Brown & Brown also focused on addressing the company\u2019s large claimants, those incurring more than $50,000 in claims. These large claimants made up just 8% of the population but represented 82% of paid claims.[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_padding_bottom=”pb-2″ equal_height=”yes” content_placement=”bottom”][vc_column width=”1\/4″][vc_single_image image=”792″ img_size=”full”][\/vc_column][vc_column width=”3\/4″]\n

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\n The Results\n <\/h2>\n\t\n <\/div>[vc_column_text]<\/p>\n

$2,170,000 in savings for the years 2019 & 2020.<\/h3>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_padding_top=”pt-2″ equal_height=”yes” content_placement=”middle”][vc_column][vc_column_text]Under this newly designed plan, employees had better access to care at substantially lower costs. The dealer\u2019s large claimants dropped from 19 to 9, lowering the large claim spend by 43%. HR reported its best open enrollment ever. After the first year, costs decreased by more than 15% and the employer saved over $900,000. In 2020, the company was under budget by more than $1,250,000, bringing its total savings with Brown & Brown to $2,170,000 over a two-year period.<\/p>\n

Beyond the outstanding financial results, enrollment increased, the employees received a better plan at a lower cost, employees are more compliant with prescriptions, hiring managers\u2019 challenges are reduced since a robust benefits plan is now in place and across the company there has been positive feedback from employees.[\/vc_column_text][vc_single_image image=”1423″ img_size=”medium” onclick=”custom_link” img_link_target=”_blank” link=”https:\/\/www.bbrown.com\/wp-content\/uploads\/2022\/01\/Case-Study-%E2%80%93-Automotive-Medical-Plan-Spend-%E2%80%93-Brown-Brown.pdf”][\/vc_column][\/vc_row][vc_row][vc_column]\n

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Ready to help minimize your risk and uncertainty?<\/p>\n

\n Contact us for more information.\n <\/h2>\n\t\n <\/div>\t
\n\t\t\t\t\t\n\t\t\t\tContact Us<\/span>\n\t\t\t<\/a>\n\t\t\t<\/div>\n[\/vc_column][\/vc_row][vc_row][vc_column][vc_separator][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]DISCLAIMER:<\/span>\u00a0<\/span>Brown & Brown, Inc. and all its affiliates, do not provide legal, regulatory or tax guidance, or advice. If legal advice counsel or representation is needed, the services of a legal professional should be sought. The information in this document is intended to provide a general overview of the topics and services contained herein. Brown & Brown, Inc. and all its affiliates, make no representation or warranty as to the accuracy or completeness of the document and undertakes no obligation to update or revise the document based upon new information or future changes.<\/span>[\/vc_column_text][\/vc_column][\/vc_row]<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

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