See Which Employers Are Aggressively Increasing Rx Tiers for Cost Savings

How are you handling the rising cost of prescriptions? Find out what the trends are and how other employers are handling increasing costs from the UBA Health Plan Survey.

Original Post from on July 21, 2016 by Bill Olson, Chief Marketing Officer at UBA.

The Latest UBA Survey data shows employers are flocking to two strategies to control rising prescription drug costs: moving to blended copay/coinsurance models vs. copay only, and adding tiers to the prescription drug plans. Almost half (48.9%) of prescription drug plans utilize three tiers (generic, formulary brand, and non-formulary brand), 4.3% retain a two-tier plan, and 44.1% offer four tiers or more. The number of employers offering drug plans with four tiers or more increased 34% from 2014 to 2015. The fourth tier (and additional tiers) pays for biotech drugs, which are the most expensive. By segmenting these drugs into another category with significantly higher copays, employers are able to pass along a little more of the cost of these drugs to employees. Over the last two years, the number of plans with four or more tiers grew 58.1%, making this a rapidly growing strategy to control costs.

Employers with 1 to 99 employees have been driving the trend to adopt prescription drug plans with four or more tiers. In three years, plans with four or more tiers increased approximately 60% among these groups, making this the top cost-containment strategy for small employers, who make up the backbone of America.

Even the largest employers (1,000+ employees), 81% of which historically have offered plans with two or three tiers, have seen a 12.9% decrease in these plans as they, too, migrate to plans with four or more tiers (albeit more slowly).

The construction, mining and retail industries have also been steadily leading the migration to plans with four or more tiers over the last three years, and in the latest UBA survey, 47.5%, 53.2% and 46.3% of their respective plans fall in this category. But this year, the utilities industry has made a more sudden switch, with 58.3% of those plans now consisting of four or more tiers, leapfrogging its perennial tier-climbing peers. This is a significant jump, considering nearly 20% of plans in the utilities industry were still two-tier plans just three years ago—far more two-tier plans than any other industry group at that time. However, this wasn’t a total surprise since, in the 2014 survey year, the industry had an above-average amount of three-tier plans (65.9% vs. an average of 57.1%).

The education and manufacturing industries are more reluctant to shift to plans with four or more tiers. Over the last three years those industries have maintained the highest amounts of three-tier plans, and in the latest survey, 52.8% of their plans remain at three tiers.

Two-tier plans are becoming nearly as rare as single-tier plans, shrinking 45% to 4.3% of all prescription plans in three years. Agriculture has the most holdouts, with 14.8% of plans still comprised of one or two tiers.

Regionally, the East Central U.S. has been leading the migration to plans with four or more tiers for the last three years, followed by North Central and Southeast employers. In the 2015 survey year, Southeast employers eclipsed East Central employers with 60.7% of their plans with four or more tiers.

Strangely enough, East Central and Southeast employers have the lowest percentage of three-tier plans (34.3% and 34.1%, respectively) but the highest percentage of single-tier plans (4.7% and 4.2%, respectively). Other Western employers (excluding California) also have below-average three-tier plans (40.6%), above-average four-tier plans (49.1%) and above-average (10.2%) one- to two-tier plans.

Groups increasing tiers most aggressively for cost savings

California employers have the most two-tier plans (22.9% vs. the average of 4.3%) which, although still off the charts, represents a 20% decline from the previous survey year.

Mid-Atlantic and New England employers have had the most three-tier plans for the last three years, making them the top resisters of plans with four or more tiers over time.

Groups resisting 4+ tier plans

For more information on prescription drug trends, including the companies making an early leap to five-tier plans, download UBA’s free (no form!) publication: Special Report: Trends in Prescription Drug Benefits.


Olson, B (2016, July 21). See which employers are aggressively increasing Rx tiers for cost savings [Web log post]. Retrieved from

4 Ways Benefits Administrations Can Stop Cyberattacks

Original Post from

By: Tom Pohl

There are reports of data breaches in the news every week, impacting a range of organizations and industries. These cyberattacks are costing businesses, both large and small, a great deal to resolve — from financial expenses to IT and legal resources to reputation recovery efforts.

According to a new study by the Ponemon Institute, data breaches are costing the health care industry $6.2 billion annually. Nearly 90 percent of health care organizations were victims of a breach in the last two years, raising concern for patients, employees, and others involved in the health care system.

Today, the leading cause of health care data breaches are targeted criminal attacks that seek to place valuable personal information into the hands of malicious actors. The personal information given out to health care organizations can be some of the most valuable to cybercriminals. For example, when enrolling in benefits, the information submitted can include patient names, family history, Social Security numbers, and billing information.

It’s important to also note that not all breaches are malicious. Human error is often a cause of breaches, asCompTia’s International Trends in Cybersecurity report found the 58 percent of security breaches are typically due to human error.

So what can benefits administration technology providers do to keep sensitive data secure from human error and malicious threats?

Conduct extensive user testing on your security systems

Implementing user testing through a third party vendor allows benefits administration technology providers to discover gaps or holes in their security systems. This can be done via a user testing group, which is comprised of individuals trained to discover the predominant methods that cybercriminals would abuse to compromise web-based applications.

The group is given a platform with authorized access and fake scenarios, all set up to act as if the system was running as usual. As these experts go into the system and know what areas to try and hack, the organization is able to develop plans to combat or repair these issues. User testing is similar to proofreading a paper; getting a second set of eyes on a program allows companies to see the full risks of its security system.

Educate employees on cyberthreats

As data breaches become a daily concern for IT departments, educating employees on the risks and dangers of cyberattacks becomes even more of a priority. Benefits administration technology providers need to prioritize educational resources and programs to teach employees how to spot potential cyberattacks, especially as they are handling their customers’ private information.

An effective and simple way to train employees on how to spot strange activity can be done via an email phishing awareness campaign. This involves delivering emails to employees with mocked up links or downloadable materials that, if real, would have the potential to open users’ accounts up to cyberattacks. Organizations should also consistently remind its employees to report any suspicious activity and to change their passwords regularly for a more secure system.

Automate processes to reduce the risk of human error

Recently, Google was in the news for a suffered data breach via its benefits provider. Yet the reason for this incident was human error, in which an email sender accidentally sent a document to the wrong contact. Fortunately for Google, the damage was limited, but human error is not always so forgiving.

With automation, benefits administration technology providers have the ability to decrease the chances of sensitive information getting into the wrong hands. This can be done by sending dummy files before sending the actual files to contacts. Another option is to implement triggers on email accounts when certain information is involved. For example, if a file is attached to the email, prompt the sender to confirm it is the correct file before sending. Implementing automation is a key factor in combatting human errors that could increase the risk of a cyberattack, especially when it comes to personal data.

Beware of the insider threat

While public perception is that these attacks result solely from the actions of malicious hackers outside of an organization, insider threats are a growing and serious concern. Vormetric’s 2015 Insider Threat Report reveals that over 90 percent of U.S. organizations believe they are vulnerable to insider threats such as stolen passwords or email spam. In fact, the National Association of Manufacturers released a statement in April 2016 stating the theft of trade secrets has cost businesses $250 billion per year.

Benefits administration technology may want to go a step further to ensure employees are operating in the correct space. Requiring background checks and limiting access to sensitive data will provide an extra level of security for patient, employee, and others’ personal information.

Harvard Professors Fall Out Of the Ivory Tower with Health Care Hikes


Source: United Benefit Advisors, LLC

The New York Times recently stirred up a media firestorm when it reported about Harvard University professors who were lambasting the health care increases they were facing this year.

Apparently, members of Harvard’s Faculty of Arts and Sciences voted overwhelmingly to oppose the changes that would result in increases to health care costs.  In response, Harvard pointed the finger at the Patient Protection and Affordable Care Act (PPACA).  Ironic when one considers these very same individuals have been advising the president and Congress on how to provide health benefits to the nation at a “reasonable cost.”  In response, UBA CEO Les McPhearson said, "Harvard professors are now realizing what the rest of the country has been experiencing for years - namely, that the cost of health care continues to be a heavy financial burden for employers and employees. They may have fallen out of their ivory tower with their latest health care rate hikes, but they are still a long way from reality with deductibles, out-of-pocket maximums and copays 153.51%, 88.54%, and 26.09% lower, respectively, than the average worker."

While most of us can sympathize with the financial pinch these Americans are feeling, most workers pay far more for much less coverage. UBA’s 2014 Health Plan Survey, which looks at 16,467 plans from nearly 10,000 employers, gives the most comprehensive look at the costs of health care to both employers and employees. The survey shows that what Harvard professors will be paying is far below the norm.


Copyright © 2015 United Benefit Advisors, LLC. All Rights Reserved.

While Harvard employees have an annual deductible of $250 for a single individual and $750 for a family, nationally, most workers have an in-network median deductible of $1,500 for single coverage and $4,000 for a family ($3,000 and $6,000 respectively for out-of-network median deductibles). Even by Massachusetts’s standards, Harvard employees are getting a good deal. Most Massachusetts workers have a median in-network deductible of $1,000 for single coverage and $2,500 for a family. Quite simply, low deductible plans, like the ones offered at Harvard, come at a cost. The higher the deductible, the cheaper the plan cost and vice versa. However, having employees pay deductibles and participate in cost-sharing can help promote responsibility on the employee when making health care choices, which can reduce misuse and ultimately reins in overall costs. Employers, like Harvard, simply cannot continue to carry the load of health care costs as the rates continue to escalate. As of 2013, health care costs were six times the consumer price index (CPI).

Harvard employees have it better when it comes to out-of-pocket limits as well.  At Harvard, these limits are much lower than most employees have come to expect. Compare $1,500 for an individual and $4,500 for a family at Harvard to the national median in-network out-of-pocket limit of $3,500 for single and $8,000 for a family.

At the end of the day, Harvard is like so many employers today caught in the crossfire of PPACA and having to consider cost-saving measures to sustain the increase in health care costs. Whether a higher deductible plan, coinsurance, tiered or limited networks, employers have little choice but to consider cost-saving options in order to continue to offer health care to employees.

To see all the out-of-pocket costs facing most workers, see the chart below. For the latest health plan cost trends, read our press release with industry findings and download the UBA Health Plan Survey Executive Summary. To benchmark your plan to others in your region, industry or size bracket, contact a UBA Partner near you to run a custom benchmarking report.


United Benefit Advisors Reveals 2014 Industry Trends Among Employer Sponsored Health Plans

Originally posted January 13th, 2015 by Bill Olson on

Survey finds public employees still most costly to insure yet contribute 45% less than the average employee and nearly 40% less than two years ago.

Indianapolis, IN - [January 12, 2015] - New survey data from the 2014 United Benefit Advisors Health Plan Survey, the nation's largest health plan survey of nearly 10,000 employers, reveals differences among employer sponsored health plans across various industries, looking specifically at employer cost versus employee contribution.

UBA, the nation’s leading independent employee benefits advisory organization, finds that the average total cost per employee in 2014 was $9,504, of which the average employer cost was $6,276 and average employee contribution, $3,228.

Government (Public Administration) health insurance plans have the highest average cost per employee at $11,329 (17.5% higher than average), with the lowest employee contribution of $2,040, which is 45% less than the average employee. Surprisingly, this already low contribution is an astounding 39.7% lower than two years ago when public employees contributed $3,051.

“The government sector historically has provided generous employee benefits,” says Les McPhearson, CEO of UBA. “The risk that taxpayers face is the forthcoming ‘Cadillac Tax’ if public employers can't get their health care costs under the $10,200 premium threshold. The Cadillac Tax is hefty – a non-deductible 40% excise tax on the excess benefit – which would increase the average cost per employee.”

Employer cost per employee for the manufacturing, health care, construction, retail, and hospitality services sectors are all 4% to 8% lower than the overall industry average costs, making employees in these industries the least expensive to cover. Employees in the construction industry are one of the least expensive for employers to cover at $5,373 per employee, but contribute the most toward their health benefits paying $3,620, approximately 11% higher than the average.

“The construction industry tends to be made up of young, single males who value higher hourly wages over health benefits,” says Josh Budke, employee benefits advisor with TrueNorth Companies, LLC, a UBA Partner Firm. “Even ‘free’ benefits with no copays, like wellness exams and physicals, don’t get utilized in this industry as much as in others, which leads to a lower cost and higher benefit contribution.”

“In the past, a significant percentage of the employees in the construction and food services industries, many of whom are young, did not value a health plan as part of their compensation package,” says Scott Niederbrach, Principal, Cherry Creek Benefits, a UBA Partner Firm. “Employers responded by not including them and building a business in a relatively small margin industry without the health plan in the business formula. Now that PPACA [the Patient Protection and Affordable Care Act] requires the offering of a health plan to avoid the shared responsibility penalty, the employer is crafting a health plan offering that pegs the price of the plan close to the threshold of the definition of affordability under the regulations. The young demographic of these employees would be expected to lead to a lower health plan cost.”

For further details about industry trends among employer sponsored health plans, download a copy of the 2014 UBA Health Plan Survey Executive Summary at or contact Hierl Insurance for a customized survey report. For more information about industry trends, click here. 


Top 2014 UBA Publications for Employers

Source: United Benefit Advisors, LLC

Please note that all documents are download-only. For printable versions, please contact your benefits advisor.

1. The Employer's Guide to "Play or Pay"

An Overview of the Patient Protection and Affordable Care Act (PPACA) and its Potential Impact on Employers and their Workforces. 

With every day that goes by, the nation's employers move a step closer to having to make "Play or Pay" decisions. Many employers have less than a year to prepare for the arrival of this core provision of PPACA. The decisions are far from easy...and the clock is ticking. United Benefit Advisors is offering "The Employer's Guide to "Play or Pay", a comprehensive white paper that offers: 

The Facts about Paying the Penalties 
Other Issues Affecting "Pay" Decisions 
Using Location, Compensation, Subsidies, Medicaid, Family Size, and Income to Make Pay or Play Decisions 
Download publication.

2.  2014 Health Plan Survey Executive Summary.

As employers consider their health insurance solutions in the face of health care reform, benefits benchmarking data is vital to accurately evaluate costs and determine if a plan is competitive. The 2014 UBA Health Plan Survey Executive Summary provides the latest trends in health plan costs, design, and plan type, plus information on wellness programs and the impact of the Patient Protection and Affordable Care Act (PPACA). Download publication.

3.  A Business Case for Benefits Communications.

As the cost of employer-sponsored health insurance continues to rapidly outpace wages and inflation, now more than ever employers are looking for ways to keep costs down. One way to do so (that requires very modest investment) is by improving benefits communication, a critical component of your employee engagement strategy. Download publication.

4.  Counting Employees Under PPACA.

As you likely know, the “employer mandate” section of the Affordable Care Act requires companies with 50 or more employees to either provide adequate and affordable coverage to their workers or pay tax penalties. But just how are those 50 to be counted? Download publication.


Most Consumers Value Integrated Benefits for Time and Cost Savings


Originally posted December 11, 2014 on Insurance Broadcasting

Whether it’s dental insurance or the smartphone, consumers want products that offer simplification and savings. In a new survey, Anthem Blue Cross and Blue Shield asked Americans what products make their lives easier and the findings revealed that integrated products and services are highly valued – for example, the smartphone (74 percent), printer/copier/scanner (64 percent) and the toaster oven (36 percent). And, when it comes to insurance, consumers overwhelmingly (81 percent) said it would be extremely helpful to trust the same carrier to provide their dental, vision and health coverage.

“We’re meeting the needs of both employer and employee by providing affordable and comprehensive coverage benefits, which helps save time and money every step of the way.”

So, what specifically are consumers looking for when it comes to selecting an insurance plan? Survey respondents said a range of factors are important to consider, but they most frequently point to cost as being an extremely important aspect (67 percent), followed by comprehensiveness of coverage (61 percent), customer service (60 percent) and ease of use (58 percent). Additionally, 86 percent would expect to save time, save money or receive improved care if they had the same carrier integrate dental with their vision and medical benefits.

In the current health care environment, employers are looking for products that offer their employees exceptional valuei. The good news is that simpler processes, vast networks and deep discounts offered by multiline carriers like Anthem can provide employers and employees with the exceptional value they are seeking.

“For example, we offer a vast choice of dental benefits that employees want, along with large, reliable provider networks that make it easy and affordable for consumers to maintain good oral health,” said Erin Hoeflinger, President of Anthem in Ohio. “We’ve built strong relationships with the dentists in our network and we have negotiated rates, which saves members on average 25 to 32 percent on their covered dental services.”

In addition to seeing a cost savings, consumers can expect to save time when they select a multiline carrier. Half of the consumers surveyed (50 percent) say that figuring out costs is the most time consuming aspect of health management. Two-in-five also say it’s time-consuming to find health care providers that accept their insurance (41 percent) and to get their doctors to talk with each other to coordinate care (39 percent).

“With all of the advantages available to consumers and employers who get their benefits from a multiline carrier, there’s no reason to settle for the inefficiencies of having multiple benefit providers," said Hoeflinger. “We’re meeting the needs of both employer and employee by providing affordable and comprehensive coverage benefits, which helps save time and money every step of the way.”

This report presents the findings of a telephone survey conducted among 1,005 adults, 503 men and 502 women 18 years of age and older, living in the continental United States. Interviewing for this ORC International CARAVAN® Survey was completed on July 10-13, 2014. 605 interviews were from the landline sample and 400 interviews from the cell phone sample.

The margin of error for the total sample is ±3.0 percent at the 95% confidence level. This means that if we were to replicate the study, we would expect to get the same results within 3.0 percentage points 95 times out of 100.


2014 UBA Health Plan Survey Results

Employers are always on the lookout for information that will help them evaluate their health plan design, manage rising costs, and prepare for the future of health care. So that employers can make the right strategic business decisions, the 2014 UBA Health Plan Survey provides the most accurate data to benchmark their plans based on plan type, region, employee size, and industry category. Because the survey is the largest source for plan design and cost information available in the marketplace today, employers receive more granular data giving them the best opportunity to see how their plan stacks up against the competition.

Benchmarking data from the 2014 UBA Health Plan Survey can help employers gauge a wide range of factors regarding their health plan offerings -- get all the facts!

  • Are company premiums (and annual premium increases) above or below the norm and how do they compare with other employers?
  • Are the levels of contributions a company requires its employees to pay in line with its competitors?
  • Are copays, deductibles, coinsurance and out-of-pocket maximums for a company's plans in line with averages for its location, industry and size?
  • How does a company's prescription drug benefits compare?
  • Is a company in step with the cost-containment strategies being implemented successfully by other companies in its industry?

United Benefit Advisors® (UBA) is the nation's leading independent employee benefits advisory organization with more than 200 Partner offices in the United States, Canada and the United Kingdom.

Contact us today to receive a custom benchmarking report, or to pre-order the 2014 Health Plan Survey Executive Summary that highlights key findings on premiums, out-of-pocket costs, plan design, HSAs, CDHPs, and HRAs, health care consumerism, private exchanges and the impact of PPACA on health plans.

NHTSA Promotes Two Connected-Car Technologies to Prevent Crashes

Originally posted on August 18, 2014 on Automotive Fleet.

As part of its quest to mandate vehicle-to-vehicle (V2V) communications capability in light-duty vehicles, the National Highway Traffic Safety Administration has released a research report analyzing the technology's feasibility, safety benefits, potential costs and legal issues.

The report projects that just two of many possible V2V communications applications — left turn assist and intersection movement assist — could save as many as 1,083 lives and prevent up to 592,000 crashes annually. Left turn assist warns drivers not to turn left in front of another vehicle traveling in the opposite direction, and intersection movement assist warns them if it's not safe to enter an intersection because of the likelihood of a collision.

Additional applications could also help drivers avoid imminent danger through forward collision, blind spot, "do not pass," and stop light/stop sign warnings. V2V systems transmit basic safety information between vehicles via short-range radio communication devices. NHTSA estimates that the V2V equipment and supporting functions would cost about $341 to $350 per vehicle in 2020. That cost might dip to approximately $209 to $227 by 2058, after manufacturers gain experience producing the equipment, according to the report.

To see the full article, go to:

GM Plans to Launch Hands-Free Driving by 2016

Originally posted by  CNET on September 7, 2014.
General Motors has announced it plans to introduce Cadillac models in two years that incorporate hands-free driving and Wi-Fi-enabled vehicle-to-vehicle communications to exchange traffic information with similarly equipped vehicles. GM's "Super Cruise" semi-automated technology will automatically keep a vehicle in a specific, properly equipped freeway lane, making necessary steering and speed adjustments in bumper-to-bumper traffic or long highway trips.

"With Super Cruise, when there's a congestion alert on roads like California's Santa Monica Freeway, you can let the car take over and drive hands-free and feet-free through the worst stop and go traffic around," said Mary Barra, GM CEO. "And if the mood strikes you on the high-speed road from Barstow, California to Las Vegas, you can take a break from the wheel and pedals and let the car do the work."

However, unlike the driverless vehicle being tested by Google, GM's system will require drivers to remain attentive and ready to resume control of the vehicle.

To see the full article, go to:

Bluetooth Sensors Constantly Check Car Tire Pressure, Send Alerts

Originally posted by CNET, on September 11, 2014.
"Always check your tire pressure." It's something parents teach kids during early driving lessons, and it's something most kids quickly forget. Now, a new invention making a run on Indiegogo could play the role of a nervous parent for thousands of drivers out there by continuously monitoring tire pressure and relaying that information via Bluetooth to a smartphone or in-car receiver.

To use the system, drivers would unscrew the little black caps on their tires' fill valves and replace them with round Fobo ("For Our Better wOrld") tire sensors. Each sensor continuously monitors the pressure in its assigned tire, then uses Bluetooth to relay that information via smartphone app or to an in-car receiver. Because Bluetooth is a low-energy technology, the creators say the sensors will last about two years before the batteries need to be changed. Cost for the sensors will be around $90.

The creators are working on a lock nut that can only be removed with a special wrench that will help make the sensors as theft-proof as possible.

To see the full article, go to: