Benefits

From HMCwiki

Benefits is certainly not an easy topic to dissect and but understanding it is critical to a hospital's ability to maintain competitive.

Benefit Qualifiers

It seems like every organization has different tiers of when full-timers and part-timers qualify for benefits. Many hospitals have a large percentage of part-timers and those part-timers qualify for benefits at sixteen hours per week versus another organization with a smaller number of part-timers with a benefits qualification threshold beginning twenty-four hours, the organization with the higher percentage of part-time employees with the lower threshold for benefits qualification will have a higher cost of benefits per FTE.

Therefore, it is prudent to compare your hospital's standards for benefit qualification to those of your peers. While it may not be possible to change benefit levels for all employees, some hospital organizations have still been able to find cost savings. For example, Baystate Medical Center chose to "grandfather" existing employees while establishing new qualification levels for part-time and full-time benefits of new employees.

Staffing Levels

Organizations that have a higher percentage of part time employees in certain areas, such as Nursing, may find that they are forced to have more FTEs which results in overall higher staffing levels to cover the holes that are left in patient care provision when the part timers have fulfilled their obligations. There is also the phenomenon that positions can multiply when part timers start adding hours and then organizations are forced by law to put them on full time status. Consequently, when it is time to construct the budget, the part time position(s) will app rear to be technically available which causes the total staffing hours to grow and concomitant benefits expense to rise when the part time position(s) is filled.

Calculate and compare your ration of PT:FT employees and then think about how your mix might be negatively impacting your organization's Benefit expenses.

Rollover of PTO

Placing limits on the amount of paid time off that employees can rollover from year to year is another strategy for controlling sky rocketing benefit expenses. When employees are unrestricted on the amount of PTO that they can bank and are paid out at their current wage rate when that leave is eventually taken, the cost of that PTO to the organization increases, quite substantially, as more time passes.

Pension Plans

Defined Benefit vs Defined Contribution

Return on Investment

Many organizations believe that developing and implementing a low cost benefit package is mutually exclusive of satisfying employee expectations for a rich benefits package. However, if senior executives applied the same mentality to designing their benefits plan as they do to their other business investments, they would find that it was quite possible to simultaneously accomplish both goals.

Given the increasingly high cost of health plan benefits, employers must be proactive in defining a return on investment for their heavy benefit plan expenditures and deciphering what it is that employees value the most in their benefits package. Rather than design a benefits package based on what they think their employees want, senior management should take the time to survey current employees to determine what it is that their employees really value and need in a benefits plan. Such an initiative allows the shift to focus on those aspects of the benefits package that have the greatest potential for return-on-investment in terms on human capital expenditures.

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