Benefit Plan Management in a Collective Bargaining Environment

A perspective to gain trust and compromise more efficiently

Managing employee benefit plans in a collective bargaining environment can be challenging and can lead to friction between the employer and the union.  Employee benefit offerings and wages tend to be the two biggest hurdles during the negotiation process as those are the two biggest expenses facing the employer.  We believe there are some steps that can be taken during the bargaining cycles that can help lead to a more productive, efficient and often more rewarding process when actual negotiations begin.

Educate the Members

Unfortunately, health care costs continue to rise, and keeping the same level of benefits for the union is often not sustainable.  Before throwing new ideas on the table at bargaining time, the employer should be educating the union on new ideas in the health care market and sharing annual benchmarking studies.  Examples of new and innovative programs for education would be:

  • Narrow PPO Networks
  • On-Site or Near Site Clinics (this may not be for everyone), find out the best practices when considering onsite clinics
  • Concierge Services
  • Technology Platforms – Price Transparency
  • Compliance – Affordable Care Act Taxes and Updates on recent legislation
  • Educating the members keeps them abreast of what is new in the market and can help narrow down the 1 or 2 or 3 areas to focus in on as options at negotiation time.

Conduct Frequent Meetings

If possible, set up monthly meetings.  We have seen many employers create healthcare committees or advisory groups that are made up of union representation from the various bargaining units in addition to the HR and/or Finance Teams of the employer.  This venue allows for constant education to union leadership and helps them to feel involved in the ongoing administration and decision-making of the plans.  This is also a great opportunity to have representatives from your vendors in place to help build that rapport and relationship with the unions, so that all parties have a “voice.”

Be Transparent

Even if it unreasonable to set up an insurance committee or to meet monthly, sharing actual data of your plan’s experience on a monthly or quarterly basis is vitally important.  This holds most true for the groups that are self-funding their plans.  Key information to share would be:

  • Medical Costs PEPM (per employee per month) year over year
  • Pharmacy Costs PEPM year over year
  • Large claims above a certain threshold (de-identified of course) with a diagnosis
  • Utilization metrics of the Top 10-15 cost categories of the group
  • Top 25 drugs by dollar amount and by script count
  • Benchmarking Data of Plan Designs and Costs and Contributions, read more

An additional consideration is to project your plan costs out over the next 3-5 years to illustrate the “Do Nothing” impact on future costs and employee contributions.    While this entails some assumptions, it certainly helps get the attention of the key stakeholders.

Many labor agreements call for the employees to pay a certain % of the premium, and if this is the case, both the employer and the union are in the same boat and have an incentive to work together to keep the plan affordable – for both the employer and the members.  When the union sees this type of information, they will have a greater understanding and feel an obligation to work closely with the employer in developing strategies and solutions to help change the trends.

Utilize Subject Matter Experts

This should not fall solely on the HR or Finance Teams within your organization.  Lean on your consultant and vendor partners to assist in developing the information to share and the topics to discuss.  After all, this is what you are paying them to do.

For more information or questions regarding managing employee benefit plans in a collective bargaining environment, contact the Findley consultant you normally work with, or Dave Barchet at Dave.Barchet@findley.com, 216.875.1914.

Published November 26, 2019

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On-Site Clinic Considerations — Best Practices

By Dave Barchet.

On-site clinics continue to gain momentum as more and more large employers focus on ways to improve health and well-being and lower costs. On-site clinics have evolved from providing basic occupational health to now providing services for preventive care, acute care, chronic condition management, specialty care and wellness initiatives, as well as providing prescription drug dispensing.

There are many different models that can be adopted, from having a registered nurse on site for a few hours a week to a full blown clinic (bricks and mortar) staffed with medical directors, PAs, RNs, services available during typical office hours.

Whether the reason for exploring a potential on-site clinic is to provide more robust access to your employees (especially in rural locations); to enhance and integrate your well-being program; or to focus on cost savings, there are some basic keys to success. We will review these success factors below, but keep in mind that on-site clinics are not for every employer.

A recent study by Mercer illustrated that in 2016, 32% of employers with 5,000 or more employees offered on- site clinics for primary care services, and another 10% were considering adding their own health clinics in the next two years. More than half of the employers in the survey said that their clinic was integrated with their population health efforts.

The Ante — 1,000 or More Employees at a Single Work Site

Success of a clinic is dependent upon volume, so consideration of an on-site clinic should start with your population size and, more importantly, your population location. Do you have 1,000 employees (some would even say 2,000) working at a single work site or campus? If so, this is a good start for further considerations. This cuts out any barrier of access and also greatly reduces the amount of time off the employees need to take to get to the clinic for care.

Let’s face it, one of the key drivers of utilization is the convenience and ease at which the clinic can be reached.

Hours of Operation — 40 Hours a Week, at Minimum

Not only is geographical access important, but so are the hours of operation. Consider the clinic a true doctor’s office. Your employees are on-site generally five days a week and 40 hours a week, so the clinic should be available to them during that same time as well. While the cost of operating a clinic on a 40 hour per week basis increases, so does the utilization, which is key to the success of the clinic. If operating time is limited, employees may resort to using the emergency room or urgent care as their primary care provider. Employers with multiple shifts may want to consider extending the hours of operation to accommodate shift workers.

No Cost or Copay to the Employees Who Use the Clinic

A $0 obligation for the employee will help drive utilization, which is the main factor in operating a cost-effective clinic. Findley recently conducted a study of the impact of an on-site clinic and found the plan savings per visit at an on-site clinic versus visits through the health plan network were $62 per visit. Actual plan savings will vary between different groups due to geography, the Preferred Provider Network being used, and the level of services the clinic provides.

It is important to note the exception of offering a $0 cost to the employees is with Qualified High Deductible Health plans with Health Savings Accounts. The IRS requirements of member cost sharing would remain with the QHDHP.

Trust/Ability to be Liked

This is one of the most important factors. The staff at the clinic has to be likable and trusted. How do you accomplish this? Consider an interview process with key stakeholders or a health care committee up front.

If that is not doable, consider a video message from the clinic staff to the employees. This would serve as both advertising and a way for the employees to get to know the staff personally.

Promoted and Supported by the Top Level of the Organization

Like any endeavor a company wishes to take on, it is more believable and acceptable when it is promoted and supported from the C-Suite of your organization. Moving down the path of an on-site clinic is not inexpensive, so additional investment in the messaging and where the message comes from is worth the time and cost.

Visit Other Companies On-Site Clinics

We encourage prospective groups to visit other companies’ on-site clinics to take a tour. We have found that employers with on-site clinics are more than happy, and are frankly proud, to show off their facilities. This allows you to experience clinic operations first hand, explore different options, and determine what is right for your company . . . a full blown clinic (bricks and mortar) or an RN staffing the clinic a few hours a week.


For more information about on-site clinics, contact Dave Barchet at 216.875.1914 or Dave.Barchet@findley.com.


What’s in a Name?

As you have read throughout this article, I have used the term on-site clinic, which is the most commonly used or accepted term to describe this service model. A lot goes into a name, however, and we have seen the term on-site health center being frequently used as well.

The dictionary defines a “Clinic” as: an establishment or hospital department where outpatients are given medical treatment or advice, especially of a specialist nature.

The dictionary defines a “Health Center” as: a building or establishment housing local medical services or the practice of a group of doctors.

Essentially they are defined the same way, but which sounds more appealing to you? The name can be especially meaningful if you are focusing on preventive services and wellness, which according to the Mercer Survey, over half of the responding employers was the reason for integrating the clinic into their health efforts.

An alternative for smaller employers are near-site clinics. This is primarily a financial play. as smaller employers join together to contract with a clinic to help avoid the direct overhead costs of operating an on-site clinic. Employers sharing a near-site clinic should be careful about the fees they are charged.

Some pricing arrangements allocate the percentage of the clinic’s fees to the number of employees or members in each group. If one or more employers pulls out, each remaining employer’s portion of the cost could suddenly rise to accommodate the clinic’s full operating costs. When contracting with an off-site clinic, put the onus to find employer replacements on the clinic’s operator; thus, keeping the employer’s share of the costs unchanged for the balance of the contract.