2014 Government Regulations & Business Summit
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Imagine this: You are the CEO of ABC Co. headquartered in Providence. You have 700 employees (if you include dependents, that is about 1,500 human beings) who depend on you for their health care coverage. There is no other benefit that even approaches the importance of health insurance for them.
What should you do given the tremendous increases in cost and the uncertainty surrounding reform and the future? Do you do what many are doing, namely either cutting coverage to the bone, or paying them a lump sum 401(k)-type benefit and washing your hands of it? Or do you do something radically different?
The situation appears to be a hugely confusing morass of regulations and uncertainties. Many CEOs are giving up trying to understand it, turning the issue over to the “experts.”
Some forms of karate teach you that rather than stepping back from a threat, sometimes you step inside of it. That is my thesis here. The first premise is that senior management, and most importantly the CEO, must become very informed on the issues of health care reform, rising costs, and the worsening of our overall health. This is, as they say, wicked important.
Next, managers must act by considering opportunities to actually do the right thing for employees and their families. It’s something they’ve always wanted to do but have had difficulty finding ways to do so with regard to health care coverage.
• Opportunity No. 1: Now is the ideal time to find ways to maintain existing coverage for your employees, and over time, increase coverage. The paybacks, if done correctly, can be huge.
• Opportunity No. 2: Employees like and admire CEOs who truly take care of them and their families, and take the time to understand their issues. If you are in an industry in which employee morale is important (who isn’t?), this is truly a once-in-a-career opportunity. The CEO must take personal responsibility to understand the health care issues and to instill confidence in employees that this is being taken seriously by him or her. This is nondelegable. In addition, your board of directors must be in the loop and supportive. The board must be persuaded that this can be done and should be done.
• Opportunity No. 3: Do not avoid the issue. You must set the tone, communicating clearly, regularly and frankly with employees to quiet their angst and let them know the company is taking the issue seriously. Gain their trust on this issue. Believe me, they are concerned.
Consider this as part of your speech to employees:
“I know you are worried about the future of your family’s health insurance coverage. The community is seeing higher deductibles, copays, and employee-payment shares, for less and less coverage. You have reason to be concerned with more and more businesses bailing on coverage.
“I want you to know that I disagree with that approach. I believe that better coverage and better care are the way to go. We are committing to you that we will do everything we can to accomplish this. We will enter into a mutually supportive pact: we will commit to maintaining today’s level of coverage, which in the short run will cost the company more. You and your families will undertake the responsibility to live healthier lifestyles, access the health care system responsibly, and to use higher-quality care givers. We owe it to you to get you the information necessary to do so. If we can do these things, I am confident we can do what few other companies are doing – taking a threat and turning it into an opportunity.
“We will outline a different health care proposition, one that will require as much of ABC Co. as it will of you and your family. We are in somewhat uncharted territory here, but we will engage people to assist us in designing programs to accomplish this. We will make available to you and your families wellness programs tailored to your needs. We will measure the health of our insured population, and re-measure it each year to look for improvement. And we will, with an insurer’s help, use a health care delivery system based on quality of care and outcomes. After all, that is what it is about.” •