If you're like me, you've pondered moving to high-deductible plans at some point in the last five years. Whether you made the move or not, this much is certain: Companies that started with a traditional PPO plan have generally kept those plans in place, bringing in the high-deductible/consumer-driven plans as an option, then attempted to draw employees into those plans with premium cuts and funding of health-care accounts (HCAs).
Not GE. They went nuclear. More from BusinessWeek:
"It's been a hard year to work at General Electric (GE). Salary freezes have hit its famously performance-driven employees, with some managers taking pay cuts. And now GE is making changes that could deal another blow to morale. The company is forcing its 75,000 salaried U.S. employees and 8,000 retirees under the age of 65 to choose what's known as a consumer-directed health plan, which includes deductibles that run as high as $4,000 a year. Traditional plans, where employees pay higher premiums in exchange for predictable co-pays up front, are no longer available for salaried workers. One employee says his colleagues "are looking at this as a cut in pay."
That's what's called a BOLD move people. Like so much else in today's world, it all comes down to money:
"GE says the plan is being rolled out to make employees better health-care consumers and to coincide with its new "Healthymagination" strategy, a companywide initiative for health-care innovation. While GE says its future cost savings are unclear, people with knowledge of the situation estimate it could save $1 billion over the next decade or so. With three tiers of premiums and deductibles, GE spokesperson Sue Bishop notes, employees still have options. "It's not that different from their car insurance," she says. "You get to choose the amount of your premium, and that determines the amount of your deductible."
Moving from PPO to high-deductible only. That's the nuclear option. Will the bold move by GE spawn a bunch of similar "me-too" moves? I suspect only after the move looks to be on track to save 1 billion with limited downside in terms of retention, etc.