6 Strategies to Reduce Healthcare Costs in Your Organization
February 29th, 2024 | 4 min. read
Controlling your organization’s healthcare costs can be an exhausting endeavor that often takes a significant chunk of your annual budget. If not managed properly, there’s a good chance you may not even be offering what’s most wanted – or worse, needed – by your workforce.
What if we told you it is possible to cut costs while still providing quality care, as long as you have effective strategies?
What factors impact healthcare costs?
While the exorbitantly rising cost of healthcare is often discussed today, it’s all too easy to overlook the factors that are actually driving these costs. You may not have total control over all of these, but it’s important to understand the major reasons why the cost of care is going way up.
Common reasons healthcare costs are rising:
- Current health issues or chronic conditions: Health conditions like diabetes, heart disease, and mental health needs can cause the total cost of care to skyrocket. According to the Centers for Disease Control (CDC), an estimated 90% of our country’s annual $4.1 trillion spent on health care goes towards mental health and chronic conditions.
- Average age of your workforce: There’s no argument that as we age, our medical needs increase. Along with this, care also becomes more costly. Research published by the National Institutes of Health (NIH) found that the cost of medical expenses more than double in later years of life, and a recent Gallup poll shows that some older adults in this country have skipped getting the care or medication they need due to high costs. Other research finds that premiums can cost up to 300% more for older people than younger, which can translate to a massive hit on your bottom line, depending on how much you cover for your employees’ health care.
- Location: According to healthcare.gov, where you live can significantly impact how much insurance premiums cost. Differences in state and local rules, competition, and cost of living rates can drive costs associated with location. Traditionally, metropolitan areas have higher costs due to the specialties available.
- Cost of healthcare: The cost of offering healthcare benefits to your workforce has consistently risen. In the last two decades, the annual cost rose from:
- $2,471 to $7,911 (a roughly 200% increase) for single premiums
- $6,438 to $22,463 for families (a roughly 250% increase) for family premiums
6 strategies to reduce healthcare costs
Reducing healthcare costs doesn't have to mean compromising on quality of care. You can accomplish it in several ways, but the top 6 below are the most effective.
1. Think beyond next year's budget (instead, create a multi-year strategy)
Consider long-term solutions rather than focusing on a siloed, narrow answer that relies on immediate cost-cutting measures. To effectively reduce healthcare costs, it’s crucial to look beyond next year’s budget. Adopting a multi-year strategy allows for more sustainable savings over time.
For starters, you can implement health and wellness programs that promote preventative care. These often result in reduced chronic disease cases, which can lower associated future treatment costs.
Examples of simple health and wellness initiatives organizations can start include:
- Offering yoga classes or training
- Starting wellness challenges
- Providing healthy lunch and snack options
- Creating volunteer programs
2. Rethink traditional health care
Ditching the traditional – broken – care model can offer many benefits. Your organization can enjoy everything from improved health outcomes to total cost of care savings to happier employees, which can translate to attracting and retaining top talent and reducing turnover.
One popular alternative model of care includes Advanced Primary Care, which offers improved access to care and makes it more affordable and effective for people via onsite, nearsite, and virtual care options for your employees and their families.
3. Preventive care focus
Preventive care fosters a healthier workforce and helps avoid expensive (and time-consuming) treatments in the future. Regular check-ups, screenings, and vaccinations are vital components of preventive care.
4. Pharmacy management
Rising prescription drug prices and inefficient pharmacy management are often overlooked factors when discussing issues that are driving up the cost of care. It’s possible to mitigate the impact of high drug prices to ensure substantial savings.
Encourage your workforce to:
- Pharmacy shop – not all drugs will cost the same from pharmacy to pharmacy
- Educate about manufacturer discount cards and coupon cards
- Ensure people know they can request generic medication
5. Expand accessibility with virtual care
Virtual care grew in popularity thanks to COVID. Today, while things are thankfully returning to normal, getting to a physical location can still be challenging for some people – whether it’s due to a distance or mobility issue. For them, it’s nice to know that technology makes it possible to still be able to quickly and effectively receive care without having to go into a care center.
Adopting Advanced Primary Care ensures those who aren’t close to an onsite or nearsite care center still have access to quality care via a virtual setting.
6. Implement Advanced Primary Care
Advanced Primary Care is an alternative model of care that makes it easy to find, access, and receive care. Everside Health providers can address up to 90% of primary care needs, and employees have come to love the convenience, quality, and thoroughness they get when they see an Advanced Primary Care doctor.
Advanced Primary Care reduces the cost of care
Though the concepts of quality and cost-effectiveness might seem counterintuitive, the truth is that Advanced Primary Care from Everside Health offers a solution that can reduce healthcare costs, saving your organization millions while satisfying employees’ needs for quality medical healthcare benefits.
With a strong emphasis on preventive care, health issues can be detected earlier, making conditions easier – and cheaper – to address, improving health outcomes, and increasing employee satisfaction. Same- or next-day appointments are often available, and low- or no-cost copays make care affordable and convenient.
Making healthcare cost-effective for your organization
Reducing healthcare costs doesn’t have to mean sacrificing quality of care available to your employees and their families —it’s about being smarter with managing your resources and using effective strategies that take a holistic approach to care.
Partnering with Everside Health and implementing Advanced Primary Care in your organization is an excellent way to improve the quality of care you offer your workforce while strategically lowering your cost to do so.
Sources:
https://www.cdc.gov/chronicdisease/about/costs/index.htm
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6680320/
https://news.gallup.com/poll/393494/older-adults-sacrificing-basic-needs-due-healthcare-costs.aspx