PPO Is How They Go

When it comes to health care benefits, the PPO plan still dominates — and it’s not even close.

About 71 percent of organizations currently offer a preferred provider organization plan, according to a 2015 survey from the Human Capital Media Advisory Group, the research arm of Talent Management magazine. 

After the PPO plan, the second and third most popular health care plan options are high-deductible health plans, or HDHP, and health maintenance organization, or HMO, at 33 percent and 31 percent, respectively (Figure 1).

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The HCM Advisory Group’s “2015 Health Care Benefits” survey, conducted last November, collected data from 370 organizations of varying sizes and industries. Roughly 86 percent of the companies polled are based in the United States, with 44 percent of the respondents being director level or above.

The main upside of a PPO is employees don’t need referrals from a primary-care physician before seeing an in-network physician or health care provider. The plan gives employees more freedom to make their own health care decisions.

The survey collected information on different types of health care plans, incentives, ancillary benefits and changes for the future. Along with PPOs, most companies offer an employee assistance program, or EAP, the survey showed. Of the organizations surveyed, the majority (71 percent) said they implement an EAP.

An EAP provides a variety of health services to employees, including assistance with family matters, mental health issues and work-life balance. About 81 percent of the organizations polled said their EAP provides job stress management and mental health resources.

Following those services, substance-abuse counseling, relationship counseling, bereavement counseling and work-life balance programs are the most offered, the survey showed.

Furthermore, the survey asked respondents what wellness incentives are available for employees. Responses showed the two most popular are health account contributions, at 28 percent, and health insurance premium reductions, at 27 percent. Wellness programs focus on different areas of health such as weight management programs and sleep management programs.

According to the survey, 63 percent of respondents said physical activity programs are the most targeted. On the other end of the spectrum, just 8 percent said brain games and training programs are offered.

Moreover, health care plans often provide ancillary benefits. Ancillary benefit options include coverage for immunizations, accidents, hospital indemnity, critical illnesses, dental and vision, the survey showed.

Immunization coverage is the most commonly offered in health care plans, as 77 percent of respondents said they offer the coverage, according to the survey. Just 40 percent of respondents said their company offers vision coverage.

As health care plans vary in what benefits they offer, there are also different policies regarding who receives these benefits.

All the organizations surveyed provide their full-time employees with health care, and 37 percent of organizations include benefits for part-time employees, the survey showed. About 86 percent give benefits to spouses and children of employees; 58 percent offer domestic partner benefits (Figure 2).

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With a clear preference toward PPO health care, most companies reported they won’t be changing their coverage of employee health care in 2015.

Almost 70 percent of organizations said they will keep their health care benefits the same this year, according to the survey. About 20 percent of companies said benefits will increase. The remaining 10 percent reported they will decrease health care benefits (Figure 3).

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With some change on the horizon driven by the continued implementation of the Affordable Care Act, companies will have to make decisions in the next few years regarding health care.

For example, the so-called “Cadillac tax” goes into effect in 2018 under the new legislation. The regulation implements a new tax on employers that provide high-cost health care plans. Only 15 percent of organizations predict they’ll introduce changes to their health care plans in anticipation of the Cadillac tax. Other changes to health care plans include a transition to private exchange health benefits.

About 28 percent of organizations said they plan to provide health care benefits through a private exchange, the survey showed (Figure 4).

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When making changes, companies have to take into consideration their ultimate goals. The survey gathered the ways in which organizations measure outcomes of health and wellness programs relative to those goals.

The goal of reducing health care costs had the highest results, the survey showed. On the other hand, the goal of enhancing employee retention has the lowest emphasis.

 Overall, the majority of organizations didn’t measure the survey’s presented goals in regard to health and wellness programs. These presented goals include but are not limited to: enhancing employee recruitment, becoming an employer of choice, creating a culture of health, enhancing employee engagement, improving workforce productively, enhancing employee satisfaction, and reducing absenteeism and presenteesim. More than half of the organizations reported that they didn’t measure any of the outcomes related to these goals.