Proven Strategies to Enhance Employee Health Plans and Lower Costs
By Jesse Kohl, President, InterLutions
October 6, 2023
Credit unions and their employees continue to pay more for health insurance while the carriers continue to profit. To change the course of your employee beneﬁts and medical insurance spending, credit unions need to do something diﬀerent and better. The power of collaboration among credit unions continues to be a core reason for our success as a movement.
InterLutions, a CUSO specializing in innovative and collaborative healthcare models, developed customized solutions for large and small credit unions to pool their resources together, lower their medical insurance costs, and enhance their employee benefit plans. Here are three strategies we employ to help credit unions find a better path:
1. Collaboration: When it comes to purchasing health insurance for your employees, size and scale matter. The more employees on the plan, the more predictable the outcomes will be for insurance underwriters – equating to lower costs. When multiple credit unions collaborate to purchase insurance together, the risk of high-cost claims is further spread out – equating to lower costs.
Tip #1: Work with your trusted system of credit union providers to build a collaborative healthcare model for credit unions. These solutions exist, and they have proven to save credit unions hundreds of thousands of dollars through volume-based negotiated medical insurance premiums.
Insurance captives, for example, allow credit unions to collaboratively purchase insurance more efficiently and at lower costs through their unique funding models. Transitioning to a self-insured funded health plan model is more viable through an insurance captive. Plus, captives are more flexible when it comes to carrier options and plan designs.
2. Data: Credit unions need better access to healthcare claims data to prove to the insurance carriers that we are a healthy population and an attractive risk for underwriters.
Tip #2: 23%. Our CUSO’s latest medical claims analytics report shows that credit unions’ per-employee-per-year (PEPY) medical claims costs are 23% less than other industries we evaluated. Are we as credit unions really 23% healthier than other industries? Our data says YES.
When we compare our credit union employee claims against other industries, our employees perform 23% “better” than the average employee across other industries. Even when compared to other financial services employees, credit union employees still outperform their peers when it comes to gross PEPY medical claim costs. Let’s leverage this data to negotiate lower medical insurance premiums.
3. Enhanced Underwriting: Most credit unions fall under a community-rated underwriting strategy through their insurance carrier. Community-rated underwriting calculates premiums based on the average risk of an entire community of employers, rather than individual risk factors. A community-rated underwriting strategy does not provide the employer with data to understand why premiums are increasing, offering minimal assistance to help them improve their employees’ health.
Tip #3: Ask your broker to evaluate enhanced underwriting strategies that will provide your credit union with enhanced data to understand your true health care costs. Better data = more options. And more options can lead to lower costs, better plan designs, and improved health.
Let InterLutions help your credit union evaluate your best options for improved employee health plans. To learn why so many credit unions are choosing I-Care for their employee health plans, contact InterLutions.
InterLutions is a wholly owned Credit Union Service Organization (CUSO) founded in 2015 to provide innovative solutions to the credit union industry and movement.
Its flagship product, I-Care, provides enhanced medical insurance benefits to credit union employees at lower costs. By pooling employees from many credit unions, volume helps reduce claims risk and volatility of premiums, lowering costs for employees and credit unions. Lower costs and multiple plan options give credit union employees the benefits they deserve.