Providing health care and dental insurance benefits for employees is not going to get any cheaper, says one consultant.
So employers should be proactive and deal with the problem as best they can.
“Benefits are certainly becoming a increased part of your budgets and therefore part of your headache and therefore part of your desire for knowledge,” says Matt MacLean, senior consultant with Aon Hewitt, a company specializing in human resource consulting, research and outsourcing.
MacLean spoke to a crowd at the Delta Hotel and Conference Centre Newfoundland Tuesday during the Labrador Employers’ Council Fall Conference.
Medical and dental costs are not going to go down any time soon and will get worse, warned MacLean, however there are some tactics employers can use to keep costs down.
MacLean described Canada as being in the midst of the “hump” of a baby boom. With a large part of the country’s population aging, MacLean told the crowd it is more important than ever for companies to look at their benefits and to come up with innovative ways of managing those costs.
“We have more people and they are all expected to live longer,” said MacLean.
He focused on one area in particular during his presentation.
“Doctors are engaged, encouraged, to prescribe more expensive (brand name) drugs.” - Matt MacLean, Senior Consultant with human resource consulting
“Drugs ... this is the single biggest cost driver now and in the future,” said MacLean.
Part of the problem lies with the pharmaceutical companies themselves, he said.
Pharmaceutical companies actively discourage doctors from prescribing generic drugs.
“Doctors are engaged, encouraged, to prescribe more expensive (brand name) drugs.”
Prior authorization is a good way to counter these strategies, he said. Such a policy would ensure expensive drugs are a secondary option.
“If an employee needs to take a $2,000 drug, and there’s a high probability there’s a $50 drug that can do the job, make sure they try the $50 drug,” he said.
MacLean also encouraged businesses to track their own health care data as a way to ensure money is going to where it’s most effective.
Managing doctor’s visits by providing the employee with a checklist to present to the doctor was another suggestion. He also suggested making sure employees understand premiums will go up as insurance is used.