To successfully manage health benefit costs, business have to treat health benefits as a total business issue, and should apply the same business discipline they apply in their core business functions. Employers must strive to provide for increased information on health benefits and empower their employees to make their own choices and to determine what coverage is best for them (Watson Wyatt Worldwide, n. d. ).
The WBGH/Watson Wyatt Survey Report (n. d.) also points out that meeting the challenges of rising health care costs is crucial in shaping organizations’ health care planning systems, tactics, and ultimately their future. The employer who places a high priority on health benefits greatly contributes to boosting the morale of its employees. Since the CMS enrollment process for the Part D plan has been difficult and complicated for employees to maneuver around, employers may suffer from low attendance and productivity as their employees fail to report to work due to health problems.
These health problems, in turn, are due to failure in getting the medication they need for their respective health problems. The short-term impact of the complicated enrollment process is, simply put, that employees will either not show up for work, or will not be at their optimum physical best to perform the quality of work needed of them. Lacking of assistance and support from the employer in helping their employees through the Part D transition period will also give the employees the impression that they are on their own.
It would make the employees feel that their health care is an issue that they need to tackle on their own, instead of it being a key priority to the business organization as a whole. As a result, employee morale, not to mention loyalty to and confidence in the organization, can suffer. The long-term impact is that the company’s overall work productivity will suffer, in addition to resulting to an increase in the employer’s health benefit costs.
Ultimately, the company’s return-on-investment (ROIs) will be affected, and the company may not achieve its business objectives in the long run due to problems with its human resources. As employee morale goes down, a company’s turnover rate may go up, as the employees seek greener pastures elsewhere. An employer who does not place a premium in ensuring that one of its employee’s primary concerns – health care – is not addressed risks losing its manpower to competing organizations which offer greater benefits to employees.
Consequently, the employer ends up spending more on retention, and in hiring and training new employees to take the place of their former employees (Camillus, 1999). In the long run, the employer incurs more expenses when its manpower fails to contribute to the organization’s business objectives. According to a news report by Julie Rovner (2006) for the National Public Radio (NPR) website, this enrollment and transition period for the Part D plan presented a very serious problem for the estimated 6.
5 million low-income Americans who previously received both Medicare and Medicaid coverage. People previously enrolled in the Medicaid drug coverage paid $1 per prescription. Since these people were aware that their Medicaid drug coverage ended on December 31, 2005 many enrolled in a new drug plan pursuant to MMA requirements, and received verification that they have successfully been assigned to a new drug benefit plan under the Part D program (Rovner, 2006).
Since Medicare and the plans did not get correct information on those considered as dual eligible beneficiaries, when these beneficiaries went to pharmacies to purchase their medication, they were told that they were not entitled to the lower cost, supplemental benefit, or any benefit at all, as previously guaranteed under their Medicaid coverage prior to January 1, 2006.
Worse, these beneficiaries were charged the wrong, and always the higher, amount (Stebbins, 2006). They were told that they would receive $250 deductible, $89 a month, and $5 for each prescription, but these are actually the Part D costs assigned for people with higher incomes. Low-income patients were supposed to pay no deductible, no premium, and no more than $3 per prescription (Rovner, 2006).
Patients unable to pay the $250 deductible did not receive their medicine from these pharmacies, and not surprisingly, many of these beneficiaries have been going without their medication simply because they cannot afford to pay for them, since, after all, prior to January 1, 2006 when Part D rolled out, these medications were fully covered by Medicaid (Stebbins, 2006).
Part D and their families remain confused about which Part D plans to choose, and faulty CMS eligibility data have resulted in regular denials of prescriptions, with both beneficiaries and pharmacists regularly shouldering out-of-pocket costs just to ensure continuity of medical treatment (Slaughter, 2006).