OGDEN, Utah — Despite looming cutbacks to employee healthcare, credit unions are searching for options to deliver health benefits at levels close to what staff have come to expect.
Employees are picking up some of the tab through higher deductibles and co-pays. Larger risk pools are being created by small credit unions banding together with the help of their respective leagues. Some are cutting out offering multiple insurance carriers to keep their own risk pools higher, and others are seeking ways to eliminate or take advantage of broker fees.
At the $4.5-billion America First CU here, Kent Streuling, VP of HR, said that for the credit union industry, employees sharing in a greater percentage of the healthcare costs is something that needs to take place. Many credit unions, including America First, are turning to Health Savings Accounts (HSAs).
"This pushes consumer-driven healthcare, making employees use their healthcare dollars wisely," said Streuling, who chairs CUNA's HR/Training & Development Council. "Your 4-year-old son has the sniffles and if all you have is a $10 co-pay, you go to the doctor. But if you have to pay the first $2,000 out of pocket, and you discover that the office visit really costs $55, are you going to go?"
The $1.2-billion Technology Credit Union in San Jose, Calif., is looking to cut the costs it pays to insurance brokers by bringing that function in-house, explained LeeAnne Giblin, SVP-HR. "We have someone in our financial services area who has her broker's license."
If it works out, that will eventually cut out the typical 7% premium the credit union pays brokers to shop for the best health insurance deals. But TCU is not ready today to bring that function completely in-house, so it is partnering with an insurance agency to manage some of the details, which will still cut the 7% broker fee in half this year.
In West Jordan, Utah, the $2.3-billion, Mountain America FCU doesn't shop around for employee healthcare benefits as much as it leverages strong negotiation skills to keep costs down, shared Lynn Stephens, HR SVP. The credit union keeps "very close relationships" with its providers, and when it is hit with a large increase, Mountain America goes back to the insurer, provides details on the risk profile of its employees, describes all of the CU's wellness programs, and explains the healthcare education and advice it shares with employees about how to manage healthcare expenses. "We say we'd like a break in the pricing," Stephens said.
That approach cut a 40% premium increase in half two years ago, and last year chopped a 16.5% increase to 9%.
At the $305-million MaPS CU in Salem, Ore., Barbara Cecil, director of HR, emphasized the importance of keeping the employee risk pool as large as possible at small and mid-sized credit unions. "Years ago we used to let employees opt out of healthcare coverage. Not anymore," she said. "We also switched from offering multiple insurance carriers to just one."
Small CUs may have the fewest options, with their tiny risk pools. America First's Streuling noted that the Utah League is managing a consortium of small CUs in this state to create a larger risk pool. Other leagues have similar programs. "It's been successful in this state because the smaller credit unions can now offer a nice 80% plan at a reasonable price, and they won't get stuck if they have six employees and one gets cancer."
