Lower your healthcare & benefits costs. Find out how — Q&A and Webinar!

View this insightful webinar — “Bring the Benefit Back to Your Employee Benefits Program” — now at: 

www.churchexecutive.com/webinars 

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By Skylar Griego

Like any employer (faith-based or not), it’s important for a church to provide a benefits program for full-time staff. This can be a struggle for a small church when program rates commonly increase 10 to 20 percent every year, regardless of the frequency of claims. The healthcare industry as we know it in the United States leaves little room for a small or mid-sized church to fully take care of the people working to spread the Word.

That’s why Louis M. Gallucci, COO of Enterprise Risk Strategies, a consulting partner of Missio Benefits, said it’s up to churches to redefine the healthcare industry as we know it.

How? To answer that question, Church Executive has partnered with Gallucci and Missio Benefits to host a free 1-hour webinar: “Bring the ‘benefit’ back to your employee benefits program.” Gallucci discusses how to leverage the strength and size of the body of Christ to enhance your employee benefits program by:

• Examining the effectiveness of your current benefits program
• Prioritizing wellness, rather than addressing illness
• Incorporating must-have HR tools & resources
• Shifting from a healthcare “user” to “consumer” mindset
• Understanding how to avoid a rate increase
• Enlisting ‘wise counsel’ in the process

Church Executive spoke with Gallucci to give readers an idea of what to expect from the webinar.

As a church looks at the benefits program it offers to its staff, what elements are usually missing, and why?

Gallucci: One of the core issues is that churches just accept what’s currently normal as their reality — and that means a 10- to 20-percent rate increase every year, whether they have lots of claims or none.

It means churches have no control over the plan design, so they get no say in how the plans are structured, the rating, how the rates are developed, or even over things they might find morally objectionable. They just accept it as normal that they can’t control their data — or even have access to their data —  to use it for stewardship. They accept that what the insurance company delivers for pharmacy benefits is ‘just the way it is.’

Many churches don’t know that most large Christian employers are doing something different: a partially self-funded church plan for their benefits and healthcare. They do it because it’s way more advantageous, structurally, than the fully insured model that small and mid-sized churches often think they’re stuck with.

The big ministries go self-funded and structure themselves as a church plan, which means they control everything, including their own data. It’s common to see single-digit increases. And I work with a bunch of them, personally, that have negative or level trends, so they don’t even have to raise their rates.

Obviously, that’s not normal for your average church, though. Many feel like, “that’s only for the really big Christian organizations.” But that’s just a fallacy — it’s a matter of opening your eyes to the reality of who we are as a body.

What does that mean? Aggregation. There are a ton of aggregation models that exist, so a church can think differently and change its paradigm. The body of Christ has leverage; we’re just choosing to be disunified.

Knowing what aggregation means, and making it not scary — because it’s not — will be a big part of the webinar. There are all sorts of ways to aggregate so that instead of a little group with no leverage that gets flung around in the wind, you can be a big group and have lots of leverage and control it.

Is aggregation the only option?

Gallucci: It would be the optimal pathway for lots of smaller churches, for sure. But if a church isn’t ready for that step, they must at least do a critical review — with wise counsel — based on their current benefits structure.

That would address a few key components. What network are you in? What type of plan are you in? Is it a PPO, an HSA, or an HMO? How do you leverage all that information to help yourself from a financial perspective, and also be able to attract and retain good people and make sure that they don’t have to compromise the wellbeing of their family to work in your church?

There’s also the contribution strategy: how much does a smaller church actually contribute towards the cost, and how can it be creative about structuring contributions to incentivize behavior and enrollment to maximize plan efficiency?

You also have to think about how a small church can leverage technology to get out of the administrative nightmare of paper forms and tiered rates, and so on. How do you automate the process so that you can easily make changes? (If you hire or fire someone, if someone has a baby, or if there’s a death, for example)

Churches leaders need to force themselves through the process of evaluating if what they’re doing is working, and if it’s sustainable. Then, they can objectively and honestly evaluate if a move toward aggregation is warranted. If that alone happened, most of the faith-based groups in America would be in a much better spot.

What’s the difference between “disease-centric” and “person-centric” stewardship?

Gallucci: All the big U.S. health insurance companies use a ‘disease-centric’ stewardship model. Essentially, they work to manage their highest-cost clients so that they can make more money and stay profitable. That means they’re purely reactive; they react to data gathered from numerous claims from an insured member that point to symptoms of a disease. But by the time that data raises a red flag, it’s three months old at a minimum. So, when they finally reach out to a person who has been diagnosed with cancer, that person — who’s been struggling with the diagnosis for months — doesn’t trust the insurance company when it says it wants to help him or her manage costs.

People are much more complex than what ultimately manifests as a claim.

By contrast, with a ‘person-centric’ approach, you can recognize that while the disease diagnosis is really important, we’re human beings created in the image of God. Often, what manifests as a claim might be driven by life circumstances.

Insured individuals should be made aware of available resources before a claim is issued. Things like, “Did you know that your church has a program for addiction?” Or maybe there’s another program for financial help, or free counseling.

Aggregation represents a shift in stewardship philosophy that’s Kingdom-based, not just disease-based.

Are there useful insurance / benefits tools and resources that church leaders aren’t taking advantage of?

Gallucci: Usually, yes — they just don’t know about them.

Many church leaders don’t know they can ask their brokers to do certain things, and it wouldn’t even be an unusual request.

For example, did you know there’s a massive national association that does nothing but try to help HR people and answer their questions? The average church might not know that exists, and it’s a huge resource.

There are also quite a few legal and compliance tools built to do nothing but identify all the quirks in policies based on your state and region. It helps churches handle FMLA, leaves of absence, or any other compliance issues they might have.

One of the key points in the webinar is understanding the shift from a healthcare “user” mindset to a “consumer” mindset. What do you mean?

Gallucci: In a small group paradigm — where staff members are fully insured and no matter how few claims they file, your church gets a rate increase — you can’t incentivize people to be wise consumers of healthcare.

In a PPO, for example, a staff member goes to the doctor and pays, say, a $10 copay. It might actually be a $200 charge, but they personally only pay $10, so they have no idea of the true cost. Because of that, people have zero incentive to think before they make decisions about using their healthcare.

What if we change our paradigm to one where a staff member is aware how the employer is impacted, financially, by his or her healthcare decisions? To incentivize this, you have to introduce plans that are corrective, not punitive, in terms of user behavior. Though a health savings account (HSA) might have a high deductible, done right, it makes out-of-pocket expense lower than the PPO alternative, meaning catastrophic events are more manageable. Then, if that HSA saves the employer 15 percent on healthcare costs, it can reinvest 10 percent of those savings back into an employer contribution HSA account, lowering the new deductible and making that program more attractive to employees.

It’s up to the employers to communicate this. You should explain, “We’re going to lower your worst-case scenario expenses, so if something bad happens, or if you have a baby, you’ll actually be in a better spot. Then, we’re going to fund this employer contribution HAS account for you.”

Earlier, you mentioned the power of a church “owning its data.” What do you mean by that?

Gallucci: Data is the foundation of stewardship. There’s a ton of data flying around the realm of an employer.

Big Christian non-profits are all over their data, because they save tons of money in doing so. Data is kept in an integrated data warehouse — medical, pharmacy, absence, HR, biometric testing, and wellness data. They can actually measure that data and look at where problems exist now and might appear in the future. They can examine healthcare consumption patterns, geographies, and different divisions within the organization. When you have data, you can do predictive analytics. Collectively, this provides an indicator of where resources should probably be directed to avoid future consumption and escalated cost.

But if you’re a smaller or mid-size church, you have no control under the current paradigm, because you’ll never have your data. An insurance company uses it and takes advantage of it without you benefiting. That’s normal; if you’re fully insured, you don’t carry the risk — the insurance company does. So, you don’t own the data.

If you change your paradigm and aggregate, you actually have access to your data. You’re part of a self-funded church plan, like the big Christian ministries. They do it because it saves them money, empowers their ministry, and puts more resources into the Kingdom. Why on God’s great earth would we not do that if we had the option?