Bullseye! When targeted analysis saved the day
A benefits redesign that made every stakeholder a winner
A German multinational engineering and technology company has always been very particular about the kind of health benefits they provided their employees and dependents. As part of their continuous improvement endeavor’s, they up leveled the health benefits they offer their employees on short to medium term deputations in 2018. The benefits were brought up to par with the local policies they ran in Europe.
The challenge
Where did all those claims come from?
At renewal in 2019, the insurer requested an exponential increase in the premium as the plan was running at a loss. The client was stuck in a dilemma as they had not budgeted for such a large increase in premium spend.
Our solution
If it’s simple, it’s often right!
As the plan administrators, Mayfair stepped in. Our in-depth analysis of the claims data benchmarked against the claims spends of the previous years, revealed that the spike was due to an unprecedented increase in dental claims. The dental claims were 42% of the total claims paid for this group in 2018 (the benchmark for similar plans was 8%).
Of course, the client was unwilling to reduce benefits so soon after they were offered. The insurer was reluctant to continue with the plan unless there was a significant increase in premium.
We recommended a middle ground: the introduction of a 50% co-pay for periodontics and endodontics. This way any emergency dental care would be taken care off. The 50% copay would ensure that only treatment that was required was opted for.
The result
Our looking glass holds true
Our prediction turned out to be true! The dental claims were reduced by 14% in the subsequent year.
The insurer was happy as the loss ratio remained within predictions. The client was happy as their insurance spend remained within budget. The targeted benefit change resulted in a sustainable plan that was just right for the group’s members.