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How to Increase the Value of Employee Health Benefits Through Self-Funding
by Melina Kambitsi, Ph.D.


When it comes to employee health benefits, insurance plans typically own the employer’s health data, providers set their prices, and patients don’t know where to go for care based on cost and quality. 

Brakebush Brothers Inc. decided to do things differently.  They utilized their claims data (a perk of self-funding their health benefits) to find opportunities where they could modify their health benefits plan to lower costs and promote better health outcomes.

Brakebush collaborated with vendor partners and their employees to provide employee health care options that were more easily accessible, less costly and provided high-value care.  

Support from The Top 
Ludwig praises open-minded executives at Brakebush for their support in changing the company’s approach to health benefit costs. “Employers have to get rid of the status quo,” Ludwig said. “That means employers can’t do it the way they’ve always done it. At Brakebush, we’re given the freedom to explore opportunities. We have to justify every one of these changes, but we’re given the ability to go and explore.”  

Ludwig believes that only companies who realize health care can be controlled will be able to achieve lower benefit costs. “The lack of understanding in the world of how health care is paid and what impact it has on business has really led us to this problem,” Ludwig said. “As employers, we control everything else that is on our budget, and we hold vendors accountable for giving us high-value products and services. Why are we not holding health care to the same standards?”   

Brakebush Brothers’ Top Tips for Self-Funding Results 
  1. Get ready to self-fund. Looking back, Ludwig thinks new solutions should have been ready when self-funding started in 2014, so employees immediately noticed the difference.  
  2. Be willing to change. Employers get the best results by combining self-funding with data-driven changes to their health plan. 
  3. Develop a team of collaborators, internally and externally. Internally, create a team of employees who take responsibility for changing the health plan to focus on high-value health care. Externally, network with peers and find vendor partners who are interested in working on innovative solutions.
  4. Make sure partners have aligned incentives. They should “win” financially when your company wins and lose when it loses.  
  5. Tell employees how self-funding makes a difference to their out-of-pocket costs. Explaining the relationship between the company’s costs and their health benefit premiums is a great place to start.  
  6. Remind employees of ways to save, again and again. Sharing information at open enrollment is critical, but employees need reminders throughout the year. If you have an onsite clinic, make sure clinic providers know all the current options for employee care. 
  7. Use employers’ combined power. Employers’ ability to change how they purchase health care grows when they work together.  
Brakebush Brothers, Inc., alongside The Walt Disney Company, were awarded the 2019 Employer/Purchaser Excellence Award by the National Alliance of Healthcare Purchaser Coalitions. For more details about their award-winning approach to changing employer-sponsored health benefits, Read the case study on Brakebush Brothers. If you’re interested in learning how The Alliance works with employers to make health care more affordable, contact us.

Melina Kambitsi joined The Alliance in 2017 and leads the team responsible for membership growth and retention of the cooperative. Previously, Dr. Kambitsi was chief sales and strategy officer at Network Health in Milwaukee and Menasha, WI and senior vice president of sales at Blue Cross Blue Shield in Honolulu, HI.
 
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