October Case Study: The Difference Card Helps Automobile Dealership to Improve Health Benefits and Save Over $400,000 Annually!
A car dealership company located in the suburbs of Los Angeles, Southern California, was facing rising healthcare costs for its employees.
With over 250 employees and 229 of them enrolled in its health plan, the dealership was seeking a way to reduce its $2 million annual health insurance expenditure.
At the time, the company was offering a diverse set of health plan options through two carriers, HealthNet and Kaiser, with a total of seven plans that included six HMO options and one PPO. As they faced a potential 5% renewal increase, the dealership sought a solution to control costs while maintaining strong health benefits for their staff.
The company’s employee benefits advisor engaged Michelle Ronan from The Difference Card California team to develop a customized strategy. Michelle and the insurance brokerage team evaluated the existing health plan options, which featured copays between $10 and $50 and generous deductibles, mostly at $0, with one plan including a $1,500 deductible.
After exploring alternative solutions, they identified three new plan options with increased copays and deductibles—copays in the $80 range and deductibles above $5,000. By negotiating these changes, the dealership secured a significant reduction of over 30% in health insurance premiums, decreasing their fixed costs by more than $700,000.
The next phase involved Michelle collaborating with The Difference Card’s underwriting department to structure a Medical Expense Reimbursement Plan (MERP) funding strategy. This revised plan structure maintained robust benefits for employees while leveraging The Difference Card’s MERP to reimburse employees for their higher copays and deductibles.
After accounting for expected reimbursements and the utilization of Difference Card’s MasterCard technology for payments, the dealership’s net annual savings amounted to $412,999.
Recognizing the importance of risk management, the dealership opted for The Difference Card’s Difference Guarantee, a performance assurance feature that limits reimbursement liability and ensures savings. This strategy offered financial predictability while still delivering valuable health benefits for employees.
The Difference Card consistently helps businesses across industries save an average of over 18% on health insurance costs, frequently enhancing benefits and improving employee experiences.
Discover Your Savings Potential: To explore how much The Difference Card can save for your business, find a consultant in your region or request a proposal today.
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Key Takeaways
- Concesionario en los suburbios de Los Ángeles con más de 250 empleados (229 inscritos) que gastaba aproximadamente $2 millones anuales en seguro de salud y buscaba reducir esos costos.
- Planes existentes ofrecidos por HealthNet y Kaiser: siete opciones (seis HMO y un PPO) con copagos de $10–$50 y deducibles generosos en su mayoría de $0, y un plan con deducible de $1,500.
- Equipo liderado por Michelle Ronan negoció tres nuevos planes con copagos alrededor de $80 y deducibles superiores a $5,000, logrando una reducción de primas de más del 30% y disminuyendo costos fijos en más de $700,000.
- Se implementó un Plan de Reembolso de Gastos Médicos (MERP) con The Difference Card para reembolsar a empleados por copagos y deducibles más altos, utilizando la tecnología MasterCard de Difference Card, resultando en un ahorro neto anual de $412,999 tras reembolsos.
- La compañía eligió la Difference Guarantee para limitar la responsabilidad de reembolso y asegurar ahorros predecibles; The Difference Card declara que suele ayudar a empresas a ahorrar en promedio más del 18% en costos de seguro de salud.
