Dear Clients and Friends.  I hope the attached gives you some ideas and insights to healthcare today.  As always our team is here to answer any questions or help.  Steve

While wages, job type, and environment play important roles for new employees the health benefits are becoming a major part of the job finding process and a huge cost for employers. When individuals enter the job market the concerns for their health are often first on the list. In addition compensation packages are major attractants for your current employees. Your wages may be first rate, but without a competitive benefits plan you risk being looked over by new entrants to the job market and you risk losing current employees to competition. For your business the compensation package must work for you to not only protect your employees, but also attract and retain the workforce. It is all a part of the compensation package. In many cases, it is a cost of doing business.

So how do you, as a business owner, cope with the ever increasing costs of medical insurance? Over the years we have seen employers take several paths in their search for a cost effective solution. Many make adjustments to the level of coverage. Co-pays & deductibles go up or the percentage of the employee’s payment of the premium increases. These are tough decisions and all too often the consequences create ill feeling between employees and their employer. This is unfortunate as next to the direct pay check taking care of your employees’ health is one of the best ways to show how valuable each employee is to your company.

Today insurance companies and their brokers are working with employers to find creative ways to overcome these problems.

When an employee looks at his or her compensation, they typically focus on the pay check they receive. They are often unaware of or forget additional sections of the compensation package that the employer provides or pays for. This makes it difficult for you to adjust coverage as the prices of benefits change. Few employees are fully aware of the expense of these items. By giving the employee a customized report (Employee Benefit Statements) you can show them all of the costs and benefits associated with their employment. The benefits package is a powerful motivating tool and when presented properly to your employees, helps to remind them of their value to the company. Most employees are surprised when they see everything the employer provides and pays for.

You can also control costs through a combination of high deductible group medical policies, which can qualify you for either Health Reimbursement Accounts (HRA’s) or Health Savings Accounts (HSA’s). HRA’s and HSA’s are starting to change how employees make decisions on their health care. HSA’s allow employees to lower their monthly premiums anywhere from 20-40% at the same time, give them an opportunity to save/finance their healthcare for any future needs. Contributions to HSA’s can be saved towards Long Term Care, Retirement packages, or medical costs and there is no time limit on use of the funds, giving the plans flexibility and providing your employees with long term care. You also benefit as benefit costs are reduced and your employee moral is boosted when they see that you are helping with their retirement plans. Further more the plans are available for all sizes of business. And, finally, all contributions are tax deductible, up to $2700 for individuals and $5450 for families.

In separate studies the United Health Group, Inc. and Blue Cross concluded that when employees start becoming involved with how to spend their money on health care there are positive results seen in the employer’s costs. One study followed 55,000 workers over a three year period and saw the cost of the high deductible group medical fall 3 to 5 percent while traditional group medical costs increased by 8 to 10 percent. The second study saw premium increases for the high deductible plans at a 6% rate while the traditional plans increased by 11%.

Partially self funding the group medical is another option. In this program the employer is participating in the cost of claims (up to a point) with the potential of paying less than the traditional (guaranteed cost) premium. This type of program has the potential of reducing costs and, while historically it has been reserved for larger employers, these plans are now beginning offered to smaller groups.

Another consideration is to offer a set dollar amount for your employees to spend on their healthcare needs. To help determine this dollar amount employees have the option of 3-5 plans offered through their employer. Having an array of different plans to choose from allows your employees to “buy-up” to the program that is best suited to their needs. Your employees can then “buy-up” using payroll deductions. By having a Section 125 plan all deduction can be done on a “pre-tax” basis, giving better value to their dollar. When offered choices and a variations of plans to choose from, your employees will feel that they have received the best possible option in coverage.

As your company grows and time moves on it is important to stay up to date with group medical policies and the newest methods of providing it. As new options become available and practices change it is vital to have a broker who will provide you with money saving ideas and who continuously works to find new and creative ways of giving you and your employees the best options possible in their benefits package. At Riviera Insurance we are dedicated to finding these unique solutions and you can be confident that as we enter the holiday season we will have you and your employee’s health on our minds more than ever.

Each employer has unique circumstances and what works best for one will not necessarily be productive for another. However, given that medical insurance costs are rising, alternatives need to be considered and it is vital to your business that you provide employees with proper and competitive coverage. We are confident that, over time, you will find that by changing your company’s methods, so that employees share more of the responsibility in deciding how their health care dollars are spent, you can improve company moral and actually decrease the cost of doing business.

Q & A with Steven Woodward by Susan Ahrens

SA: Share with me a little bit about you?

SW: I grew up in a somewhat “Malcolm in the Middle” situation, except without the constantly stressed mother, we were good kids. My older brother and younger twin brother (I beat him by just over five minutes) grew up in the high desert and used the Mojave Desert as our playground for years. I spent most of my time outside of school hiking, riding motorcycles, and hunting. Much to my mom’s dismay my brother and I also considered ourselves herpetologist, though not one of the best. We’re guessing that at least once a month, one we managed to lose one of our “subjects” with of course my mother finding it.

SA: What are some of your hobbies?

SW: Outside of work I need to be in the outdoors. I have been hunting since my childhood and I still manage to get out for the dove and quail season openers each year and I try to make a few fly fishing trips each year to our summer home in Montana. Locally, I keep horses and I love getting my wife and kids out on the trails and beaches to go riding. Of course, golfing is almost required in the business world these days. It has been a long time passion since I was 9 years old. Having two children has allowed me to work with kids, teaching and coaching sports. I enjoy watching kids growing up and teaching them respect for all aspects of sports is one of my biggest passions. For me the lessons that I can teach kids through sports are the same values and skills that I use in my daily business and relationships. It makes me proud to see how much I can help the kids in that aspect.

SA: Are you married or single? If married, share with me a little about your family.

SW: I’ve been married to my wife Debbie for 12 years and we are the proud parents of Garrett (8.5) and Taylor (5). While Debbie maintains control of the Woodward Household the kids are constantly active. Garrett is an all-around athlete and Taylor has started her first year in soccer.

SA: Who is your favorite fictional character(s) and how do they inspire you?

SW: The three Stooges. Growing up with three boys in the family we were constantly beating up on each other. While things often escalated beyond a cream pie in the face or an eye poke the Stooges reminded us to keep things fun. I also realized that if I was going to live that way I’d need to know a lot about Health Care Benefits. So in a way Curly, Larry, and Moe helped me into my career.

SA: How did you get started in the insurance industry?

SW: One of the brother’s in my fraternity at Cal Poly San Luis Obispo had a father in the insurance industry. After college I was invited to join the industry working in a corporate office and I stayed there for 8 years. I loved the work and 8 years ago I made the transition to the Agency side.

SA: Why are you still in the insurance industry? What is your passion for this business?

SW: Working on the corporate side taught me about the industry and being an Agent has given me the chance to really work closely with the people we were helping on the corporate side. My goals have always been to make insurance as simple as possible for people, to educate them about the need for proper coverage, and to get them coverage without breaking the bank. With insurance I get to care about people’s health and I can be an advocate for them. Knowing that I am providing a vital service and improving people’s lives has helped develop my passion for the business and kept me involved for the last 16 years.

SA: If I were looking around for another agency, what makes you unique?

SW: Riviera Insurance has a wealth of knowledge at their disposal, but the people working their also have good hearts. With insurance you are putting your employees, their families, and your own families in your agency’s hands. It is important to know who it is you are trusting and the Riviera team is made up of the people I trust the most.

SA: Do you foresee any big changes in the insurance world?

SW: Recently I have seen a change to previous insurance standards where not everything is 100% paid. I think it will become similar to automobile policies where the deductible is higher, but rates begin to drop. While policies will become more affordable larger portions of expenses will be incurred by the policy holder. Regardless of these trends I believe that having insurance is a benefit to the individual and the family.

SA: What is the best word that describes you?

SW: I think that my wife and my co-workers would call me passionate. I want the best in my work and in my play and I’m willing to put in the time and effort to achieve that. I’m proud to be a passionate individual, with all the benefits and issues that can come with that. Being passionate about what I’m doing has always given me the drive to excel. I’d like to think that I bring my game face to the table all of the time and that has helped me succeed.