We talk about it a lot: on average, when employers make the switch to Gravie they save about 19% on the cost of their health benefits. Benefits are often the second highest expense employers face, next to employees’ salaries, so maximizing the value for such a critical expense line is important. So how does Gravie help employers do this? A few things come into play when it comes to stewarding every dollar employers invest.
Underwriting is the process by which an insurer evaluates risk and determines the appropriate fee (in our case, the monthly premium), that’s reasonable in relation to the risk they are taking on. In many cases, insurance companies will take a broad, one-size-fits-all approach to this for simplicity’s sake.
Gravie’s Surgical Underwriting approach, on the other hand, takes a more tailored approach for each employer group – going beyond just previous year’s claims data to determine rates so they are more customized for the group that’s paying. Not only does this help control costs, but it also ensures that each employer group Gravie works with is reaping the greatest value from their health benefits.
A Level-funded Model
Historically, the potential for employers to benefit financially from a “good claim year” was reserved for large companies that could afford to self-fund their benefits and take on 100% of their own risk. Fortunately, there are now options that give employers of all sizes the opportunity to share in the potential surplus when claims are lower than expected and put measures in place to manage the exposure to volatility and maintain fixed monthly costs.
With level-funded plans, employers pay a fixed monthly premium that insures up to a certain threshold of expected claims with stop-loss insurance in place as a safety net to cover the rest. When claims are lower than expected, employers share in a form of a refund at the end of the year – another incentive for preferred outcomes. This means that employers don’t end up paying extensively for services employees didn’t use. Rather, level-funding offers employees a way to control costs while providing more valuable benefits to their employees. By incentivizing utilization and better health, employees and employers are both able to see the value of their health benefits more clearly. Plus, they lend themselves to more flexibility in plan design for employers to offer benefits that will truly set them apart with current and prospective employees and promote a healthy culture.
This is where benefits possibilities become truly exciting. The Comfort™ plan is one innovative plan design that’s possible through Gravie – the first-of-its-kind zero-deductible health plan offering 100% coverage on most common healthcare services. By removing common hurdles to accessing healthcare, Gravie’s Comfort plan paves the way for employees to pursue preventative care and reap the benefits of their health plan more fully.
The Defined Contribution Approach
Defined contribution is another piece of the puzzle that gives employers control over what they spend, without compromising on the value of what they can afford.
By taking a defined contribution approach, employers are able to set a fixed budget each year, and with Gravie’s help build a competitive benefits strategy around that budget. Employees then use those contributions to choose and enroll in coverage that best meets their needs through Gravie’s marketplace.
Employers pay what they’ve committed to through Gravie, and employees’ portions are deducted via payroll. With this added flexibility, employers can make decisions each year that make sense based on how they want to compensate employees and adjust as needed from year to year. With Gravie, the ball is always in the employer’s court.
With Gravie’s tailored Surgical Underwriting approach, smart, level-funded risk models and a defined contribution approach, employers can feel confident that they are getting the best possible return on their investment through Gravie with savings that make sense for everyone involved.