I frequently come across interesting information that, while not lending itself to a full blog post, is still worth sharing. This post is part of a periodic series in which I summarize this information and provide links for those who want to learn more.
• There is some new and clear evidence that consumer-directed health plans save money. A study sponsored by the Robert Wood Johnson Foundation found that families enrolled in these plans spend 14% less than similar families enrolled in conventional health insurance plans. About two-thirds of the cost savings are the result of fewer episodes of care and one third from reductions in costs per episode. Based on its findings, the researchers note that increasing coverage through a consumer-directed health plan immediately from 12.4% to 50% would $57.1 billion over ten years.
• By pursuing world-class cost levels in HR, finance and other areas of operations, companies can realize savings equal nearly 1% of revenue. Using a typical company with $33.4 billion in revenue, research from The Hackett Group suggests that such a company can cut $162 million/year from finance (47% cost reduction), $70 million from IT (13% cost reduction), $48 million from human resources (32% cost reduction) and $22 million from procurement (25% cost reduction).
• More 2013 pay projections are coming out. Although the full reports won't be out for a few weeks (hence no link), the latest from a Towers Watson survey of 857 companies is in line with our previous reporting on expected base pay increases at 2.9% for executives, salaried non-management employees and non-exempt employees. When companies differentiate pay by performance, the survey found that exempt workers with the highest performance ratings will see an average salary increase of 4.7%, while those with average ratings will receive 3.2% and those with below-average performance ratings will receive 1.3%.
In a separate survey of 278 U.S. companies, Tower Watson found that funding for 2012 annual bonuses will not quite make it to target. The survey found that average projected bonus funding will be 93% of target. This will be the second consecutive year that companies are unable to fully fund annual bonuses. Last year's funding was at 95%.
• Even as the cost of employee benefits continues to increase, companies do not feel that they are doing enough to communicate about those benefits or to engage employees in managing those benefits, according to a survey of 298 benefits professionals conducted by benefits consulting firm Benz Communications. Although most companies (78%) want to engage employees in benefit issues year round, only 29% actually communicate with employees year round about those issues. More than half of the companies also stated that their benefit communications are improving but 45% are still not satisfied with their current communications strategy. And when it comes to the budget, companies are still devoting a two-thirds of that money to printing and postage rather than more strategic investments.