Women’s International Pharmacy Gains Insight & Information by Self-Funding

Information and insight are a powerful combination. Women’s International Pharmacy (WIP) – a Madison-based organization with about 200 employees – gained both by joining The Alliance®.

The Information Gap

Like other employers offering benefits through a health maintenance organization (HMO) as part of a fully insured plan, WIP was frustrated by its inability to learn more about health benefit costs. As a result, WIP was blocked from exploring opportunities to control those costs.

“Under conventional insurance, there was no transparency,” Executive Vice-President Connie Kindschi Hegerfeld said. Health care transparency exists when purchasers and patients can access accurate information about prices, quality, and outcomes.

“We couldn’t get information about what our employees were doing or what kind of programs would be helpful from our insurance company,” Hegerfeld recalls. “Our employees and their families used doctors within the HMO and then at the end of the year, we would get a doubledigit price increase.”

Lacking information, WIP had difficulty understanding what drove its health care costs, negotiating cost-effective contract renewals and educating employees.

Opting for Self-Funding

WIP learned about The Alliance’s approach to managing employee health and health benefits from a casual conversation at a benefits conference. The Alliance moves health care forward by controlling costs, improving quality, and engaging individuals in their health. The Alliance is an employer-owned, not-for-profit cooperative with more than 300 members that provide coverage to more than 105,000 individuals across the Midwest.

WIP learned how self-funded plans aid employers in controlling costs and how employers protect their companies from the potential cost of high claims through stop-loss insurance (or re-insurance). The Alliance’s Comprehensive Network of more than 32,000 doctors and health care specialists allowed almost all WIP employees to continue to use their preferred physicians and facilities.

A Cohesive Culture

Moving to self-funding helped WIP create a sense that “we’re all in this together” when it comes to health benefits, Hegerfeld said. Working with The Alliance gives all employees similar health coverage with access to a broad range of health care providers and facilities.

“Employees understand that the dollars to pay for WIP’s share of health benefits comes directly out of WIP’s pocketbook,” said a human resources manager. “That makes a big difference in how employees view the health plan and health costs.”

Reducing Costs

Hegerfeld said WIP saved a “significant” amount in its first two years with The Alliance when self-funded plan costs were compared to premiums for a fully insured program.

The company gained significant discounts through The Alliance’s Smarter Networks, while employees gained access to many providers and facilities previously excluded from their plan. In addition, WIP gained access to reports about health care usage patterns. WIP used that information to redesign its employee benefits guide and improve its wellness program. WIP also educated employees about how their decisions impact health care costs.

“The Alliance gives us quality service to meet our needs, but they also help us conserve costs through the programs they offer,” Hegerfeld said. “They offer options to help us understand some of the solutions that are available to us that we might not have thought about.”

The Alliance members often volunteer to share what they’ve learned in one-to-one conversations, seminars or case studies. Information gathered from these experts helps shape WIP’s programs for employees. Learning more about the risks of a sedentary lifestyle prompted WIP to create walking programs and put a walking track in its warehouse, for example.

Looking Forward

A human resources manager said WIP trusts The Alliance to provide reliable information because it is a not-for-profit cooperative owned by its members. “Because of its cooperative nature, The Alliance truly advocates for employers trying to manage their health benefits,” the manager said. “And we’re advocates of The Alliance.”

WIP’s Advice for Employers

  1. Research your claims.
  2. Learn about self-funded options.
  3. Talk with The Alliance experts.
  4. Pull in other resources, including your insurance representative.
  5. Examine data to learn how choices impact costs.
  6. Educate employees about benefits and health issues.
  7. Use wellness programs to foster better health habits.