MOLD BUILDERS FACE RISING COSTS: AMBA 2020 HEALTH AND BENEFITS REPORT By Rachael Pfenninger, AMBA Project Manager
Aremains steady, mold manufacturers are more strategic than s health care costs continue to rise and employee participation
ever in how they mitigate premium cost and the types of plans and ancillary benefits they offer to employees. With insight provided by AMBA’s 2020 Health and Benefits Report, mold manufacturers have an opportunity to benchmark their costs and plan offerings against those of their industry peers.
2020 AMBA HEALTH AND BENEFITS REPORT
According to reported data in the AMBA 2020 Health and Benefits Report, the majority of respondents (97%) currently offer health insurance. Those that do not offer health insurance indicated they were small manufacturers with under $2.5 million in annual sales revenue and fewer than 20 employees.
While more than half of respondents reported an increase of 5% or less, nearly a quarter of respondents indicated an increase of 16% or more. When looking forward toward 2020, many companies anticipated the same – nearly half of surveyed mold manufacturers reported experiencing or anticipating an increase of 6% or higher. (See Charts 1 and 2.) HEALTHCARE AND BENEFITS INFORMATION OFFERED BY MOLD MANUFACTURERS
According to a recent article published on Manufacturing.Net1, the cause of rising costs is price, not utilization. Not only are there fewer physicians per capita in the US than in other industrialized countries, but there are fewer hospitals available and higher administrative costs. The US also has higher diagnostic and procedure costs – in fact, the US does more MRI and CT scans than any other country. Other contributing factors include the amount the US spends per capita on pharmaceuticals (this number is nearly double what other industrialized countries spend) and the role insurance companies play in US healthcare. Because they have no incentive to reduce their costs, insurance companies simply mark up their prices every year to maintain their profit margin. 18
the american MOLD BUILDER | Issue 2 2020
PARTICIPATION AND COST From early January to mid-February in 2020, AMBA surveyed 66 US mold manufacturers from 19 states on their offered healthcare plans and benefits. Data in the final report represented more than 3,200 full-time employees, 2,300 of whom are enrolled in their company’s healthcare plan (an average of 73%). Companies between $2.5M and $4.9M reported the average highest participation. Overall, survey respondents reported spending approximately $390,000 annually to offer healthcare and ancillary benefits to their employees – an average of $12,793 per participating employee per year (PEPY). Of the surveyed annual sales ranges, companies under $2.5M incurred the highest cost per employee. These companies reported paying over $13K per participating employee per year. This annual sales range also reported the lowest percentage of participating employees. Trending data also demonstrated that the average healthcare cost per employee rose for companies reporting higher percentages of employees aged 50 or older, while companies with high percentages of employees 30 or younger tended to pay less, on average, per employee. TACTICS TO HELP CONTROL PREMIUMS In order to help mitigate premium cost, some mold builders have implemented strategic offerings. The most commonly reported practices included moving to a high-deductible plan, offering health savings accounts, shifting premiums to employees, offering a Section 125 plan and offering flexible spending accounts. Other tactics employed by respondents included incentive-based wellness programs, gym club reimbursements, offering multiple plan options, reduced employer HSA contributions and moving to a self-funded insurance plan. (See Chart 3.) HEALTH PLANS OFFERED TO EMPLOYEES The most common plan type reported by respondents was a preferred provider organization (PPO) plan, with 54% utilizing this plan type, followed by 45% that offer a high deductible health plan (HDHP). No mold manufacturer reported offering a point of
