As employers struggle to rein in rising health care costs, cable company Comcast has kept health care costs practically flat—and it's done so by rejecting popular mechanisms that call for employees to bear more of the costs, Reed Abelson reports for the New York Times.
Employers 'frustrated' by increasing health costs
Employers—the most common source of health coverage for working-age U.S. residents—are becoming increasingly "frustrated" with rising health care costs, according to Abelson.
To reduce these costs, many employers have pushed workers toward high-deductible health plans, which require employees to pay an average of $1,500 upfront before their coverage kicks in, according to the Kaiser Family Foundation.
These efforts haven't been met with much success. About one-fifth of companies see costs increase by more than 10% annually, according to Mercer. On top of that, high out-of-pocket costs can discourage employees from seeking medical care, Abelson reports.
How the cable company curbs health care costs
To stabilize health care costs and lower deductibles, Comcast confronts its high medical costs without the help of insurers or consultants—"a luxury only the largest companies can afford," Abelson writes.
While Comcast still works with insurers, its strategy for controlling health costs centers on contracting with a "portfolio" of health start-ups through Comcast Ventures.
One of these companies is Accolade, which pairs Comcast employees with guides, or "navigators" to help them understand and apply their health benefits. Comcast also contracts with start-ups like Grand Rounds, which helps employees find a doctor, and Doctor on Demand, a telehealth company.
Comcast employees are encouraged to contact Accolade when navigating their coverage—especially if they are facing a complicated or serious medical situation. The health company's phone number is on the back of every insurance card and the benefits website.
Those efforts have helped the cable company stem deductibles and annual cost growth. Most of the cable company's 225,000 employees face a $250 deductible, and the company's health care costs are only increasing by 1% each year—2% less than the average for other large employers, Abelson reports.
Comcast's start-up strategy's success, makes it one of "the most interesting and creative employer[s] when it comes to health care benefits," said Bob Kocher, a partner at venture capital firm Venrock.
But companies looking to begin their own start-up focused benefits portfolio could face some challenges, Abelson reports. According to Abelson, employers with health care strategies that go beyond insurers may face pushback as some insurers are "reluctant to share information with an outside company and poised to undercut a potential competitor by offering a cheaper price."
However, Comcast officials said the gains are worth the extra effort. Shawn Leavitt, the executive overseeing benefits at Comcast, said, "We do these things because it's great for business." He added, "Our model is based on providing employees support and assistance in making the right decisions for themselves and their families. Employees should not feel alone, confused and overwhelmed when it comes to understanding and selecting their benefits," (Abelson, New York Times, 8/31).
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