Employee cost share is defined as the percent of total medical and Rx plan costs paid by employees. This number includes employee contributions, as well as copays, deductibles, and coinsurance. Often, when companies report cost share, they only focus on employee contributions. But with the prevalence of high deductible plans, it’s more important than ever to ensure companies measure and manage the entire employee outlay and its relation to total cost.
We recently analyzed data received from a collection of Ohio-based employers representing 650,000 lives. This was the fourth consecutive year for our analysis. Once again, we noticed a correlation between higher percentage employee cost share and lower total healthcare spend. A desirable outcome for most employers, especially coupled with offering competitive benefits.
Knowing your employees’ cost share and what affects that number is essential to effectively managing your health plan.
How does your plan compare? Do you have a goal in mind every year when deciding on plan and contribution changes? Let us know if you would like to gain more insight into this number and how to measure and manage employee cost more effectively.
*From Chelko Consulting Group’s proprietary database of employer results.
“Keeping Score” is an ongoing series where we share findings from our work on employer-sponsored health plans, so you have the opportunity to compare how your plan is performing relative to others. We hope you find it beneficial. Because, after all, you can’t manage what you don’t measure.