Cutting Complexity and Creating Unique Plans
A Global Information Technology company providing IT services and Business Process Outsourcing (BPO) in over 50 countries had extremely complicated and costly benefit plans. This resulted from a series of acquisitions and divestitures as well as a lack of global coordination and management of benefit plans. Difficulties were highlighted based on the need to:
- Transition employees from acquisitions with rich financial services industry benefit programs to a less rich benefit program consistent with the outsourcing industry
- On board acquired employees
- Assess impact of corporate changes on budgets
The company challenged Pentra to reduce their company budget by 10% and to reduce complexity. This was effectively a 20% reduction in benefit value after medical trend.
We created a plan design that met the needs of the client, but that was not available in the market. As a result of Pentra’s role on Aetna’s National Advisory Council, we approached Aetna with our request to pilot a program that included HRA-based wellness funding initiatives to offset increased deductible exposure. We were successful in getting Aetna to pilot the plan, and we negotiated a 3-year rate commitment. The plan resulted in Aetna’s highest ever percentage participation for online risk questionnaire completion as well as online wellness plan participation. Aetna has since deployed the program to other employers.
With a detailed planning process that included the CEO, CFO and Executive Directors from three business segments, Pentra lead the management team through a series of meetings and decision trees to narrow options by educating business leaders on the issues and preparing rational and predicted financial projections including identifying the impact on plans and the employee population. After extensive evaluation, the Company implemented our recommendation. It projected a 15% reduction in corporate costs.
The criteria for success was defined primarily by achieving the budget requirements but also included improved communications, a new outsourced administrative platform and, ultimately, a roll-out that did not disrupt their core business.
Pentra’s results for this client over a decade reflect the quality of analysis, well-supported recommendations and the ability to articulate the value proposition in a concise manner for the executive team.