Don’t Let Cutting Healthcare Costs Eclipse Your Talent Management Strategy

All Executive Health August 23, 2017

As the moon crossed in front of the sun on Monday here in our hometown of Hunt Valley, Maryland, we at Armada could not deny that we too were feeling the eclipse frenzy that had taken hold across the country.

The total solar eclipse may have passed, but it’s inspired us to write this blog post on a very important and timely topic that’s also affecting many people across the country—healthcare and talent management. Let’s get to it.

HR #1 Priority

HR’s top priority right now is to cut benefit costs, which makes sense with the skyrocketing premiums that don’t seem to be coming down anytime soon.

A typical strategy of cutting costs is to raise the deductible to shift some of those costs onto employees. For the employer, this seems like the right solution because less coverage equals a less expensive premium and that means their goal of cutting healthcare costs has been met, right?

Yes, but not without consequences.

Employers’ #1 Priority

One of employers’ current top priorities is talent management, which also makes sense because we are in the middle of a talent shortage. There are more job opportunities available which means candidates have their pick of employers all looking to win them over. It also means that if an employee is unhappy at a company, they will be more likely to leave because of the abundance of job opportunities available elsewhere.

The Eclipse

Let’s look at how these two priorities collide.

Cutting healthcare costs typically raises employees’ deductibles, which means they have to pay more out of their own pockets before any coverage kicks in. As you can imagine, this does not make for a very happy employee population.

So what do these employees do, especially top talent who are confident their skills will be desired elsewhere? They leave in search of better benefits. The same goes for job candidates you may be bringing aboard. If they are not contented with the healthcare benefits, they won’t accept the job. Remember, healthcare is one of the top considerations before accepting or rejecting a job!

As you can see, putting too much emphasis on the first priority of healthcare cost management eclipses talent management and makes that goal more difficult to achieve. Instead of one goal overtaking the other, these two goals need to be planned for in tandem.

Unlike an eclipse, you need to look at this problem straight on. Lucky for you, once you’ve identified that you are (or for brokers, your client is) facing this issue, there are ways to balance it out.


Of course, there are health accounts and worksite voluntary plans, but a more targeted solution to this issue is to add a supplemental expenses reimbursed plan. Unlike health accounts, this is insurance! And unlike worksite voluntary plans, this kind of plan doesn’t require an event or illness to trigger coverage.

And perhaps the best part that will link both priorities mentioned above: this kind of supplemental solution can be layered on top of the primary plan for just select employee groups because it is an excepted benefit. That means you can cut healthcare costs to meet budget goals and then add on the extra coverage as a recruitment and retention tool for the employee groups you find most difficult to hold onto.

It’s the best of both worlds.





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