Retail Chain
National, 60,000+ Employees
Summary: This Fortune 500 company had been plagued with high benefit costs, poor service and unpredictable annual renewals for years. Their costs were rising faster than the National Average each year with no end in sight, and at the same time their employee satisfaction was dropping.
We were brought in to fix two main things, costs and employee satisfaction. After a detailed analysis of the benefit programs financials and an employee satisfaction survey, our team came up with a road map to reign in costs and increase employee appreciation. These recommendations were implemented in 2006 and resulted in an overall cost reduction of over 34% in year one. Employee satisfaction was greatly improved as day-to-day customer service issues were streamlined and resolved.
The second year our client saw another 7% reduction in costs while employee satisfaction once again increased. Since our intervention, enrollment is up by 30% (one objective of the project) and substantial savings have been realized.
How?
- Reconfigured Administration: The Administrative Services vendors of this employer’s benefits plans were reconfigured. In place of hundreds of agreements nationally, there are now a few regional Third-Party Administrators administering benefits. Economies were gained while redundancies were eliminated, the change also led to many other benefits including financial reporting and contract negotiation.
- Utilization Management: Centralizing the transaction processing also allowed for substantially better access to benefit utilization statistics and more importantly created a opportunity to bring in a third party to keep track of utilization and manage specific claims.
- Proper PPO Networks: Through our extensive relationships with large carriers and underwriters, we are able to evaluate the proper network for a given region and measure the amount of savings each network can provide given the employers size and footprint.
- Pharmacy Benefit Program: By introducing a transparent Pharmacy Benefit Program this group is able to keep prescription drug costs lower than the national average.
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