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Alternatives of Medical Costs

A company finds that the cost of its medical benefits has increased far beyond what was expected, and futher increases are projected.

1. List the alternatives available to bring medical costs under control
2.Compare and contrast the advantages and disadvantages if each alternative for controlling costs.
3. What input, if any, should employees have in evaluating various alternatives to contain healthcare costs?
4. How can employee input best be solicited? How can decisions, once reached, best be communicated to employees?

Solution Preview

There are several alternatives that can be explored to bring medical costs under control. These include: increasing the employee's premium for coverage, switching to another health insurance company, offering multiple health insurance companies for different employee premiums, increasing the yearly deductible for their plan, offering a cafeteria plan, and switching to company-run insurance.

Advantages and disadvantages of each alternative are below.
1. Increasing the premium for coverage. This will pass on the price increase to the employee which may cause employee dissatisfaction. This will save the company money. This may make it so that some employees will not be able to afford ...

Solution Summary

This solution of 436 words details offers six different alternatives available to bring medical costs under control and discusses the advantages and disadvantages of each. It also talks about the importance of soliciting employee input and communication.