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Compensation Management: Health Savings Account

A) Discuss some of the choices an employer may make to help control health care costs.
B) Answer the following three questions:
1. What are some of the advantages of implementing the HSA option?
2. What are some potential disadvantages of the HSA option?
3. What do you recommend and why?

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Choice to Lower Health Care Costs
Health care costs are certainly on the rise in the United States. As a matter of fact, health care costs are rising so fast that they are becoming the most significant threat to the long-term security of workers and retirees across the country (Thornton, 2009). This is a sobering fact, but there are things that employers can do to keep these costs down, for both themselves, and for the employees that work for them. Staying informed is a good way to keep cost low. By staying informed with comparison tools an employer can gain advantage against rising prices (Berry, 2010). Another way to control costs is to promote the health of employees through wellness programs (Berry, 2010). The healthier employees are the lower the risk factors for disease and illness. This can bring about big savings for both companies and their employees. In addition, employers can help their employees make better informed and cost effective decisions for their health care future. The higher health care costs are to the consumer, the higher perceived risk is for the employer. The employer should help employees find lower cost alternatives to keep rising cost low. Finding these lower cost alternatives does not mean that health care will be sub-par. Just because the cost is lower does not indicate that services are of lesser quality. Just as companies compete on the price of their individual products, health care providers compete within their market to provide services that attract the consumer's interest and need.

There are several advantages to ...

Solution Summary

This is a 1048 word solution with three references. It outlines compensation management, specifically with a health Savings Account (HSA). In the solution questions are answered concerning HSA advantages, options, and recommendations.