BY JOHN SEELMEYER
Not long ago, says Mitch Laughton, only big companies in northern Nevada undertook the work of benchmarking their health benefits against those of others in their industries.
But as employers have seen the cost of providing health benefits rise sharply, even smaller companies increasingly are interested in comparing themselves against other employers either peers in their own industry or other companies of similar size in the region.
Laughton, president of The Laughton Company, a benefits company headquartered in Reno, says employers these days still want to provide health benefits packages that allow them to recruit top workers.
But, he adds, they don't want to pay a dime more than they have to.
Other companies believe that benchmarking health benefits provides them a critical advantage against their competitors.
"Employers are increasingly viewing employee benefits programs as strategic differentiators because they can help employers address employee loyalty, satisfaction and retention goals," says Anthony J. Nugent,
senior vice president of employee benefits sales for MetLife.
That's particularly important not to mention challenging for small companies that find themselves
competing against big national firms to recruit top talent, says John Cobbey, a health benefits broker in Reno.
"They're really caught between a rock and a hard place," Cobbey says.
Another use for benchmarking studies: Employers can determine what percentage of the dollars they
devote to benefits packages are allocated to specific items health coverage, for instance and compare the percentages with their peers.
Ed Hendricks, president of Hendricks & Associates, an insurance brokerage in Reno, says employers often use benchmarking studies to see how their contribution to health plans stacks up against others in the same industry.
Northern Nevada employers who want to undertake comparison studies can turn to a variety of sources.
The Nevada Association of Employers has been conducting a survey of benefits and personnel practices among its members for about a decade. The next round of the study is scheduled this year, says James V.
Nelson, executive director of the association.
The survey asks questions such as the length of employment that's required before workers are eligible for
health benefits, the percentage of benefits costs that are paid by employers and whether employers provide assistance with wellness programs.
Interest in the benchmarking study, Nelson says, has remained consistently strong among Nevada Association of Employers members who want to make sure they're remaining competitive.
MetLife, the insurance giant, provides a free online benchmarking tool. The Web site whymetlife.com/benefitsbenchmark doesn't provide data specifically about northern Nevada, but users can drill down to information gathered from employers and workers in the Western region.
They can see, for instance, that 96 percent of employers in the West offer health insurance, 86 percent provide prescription drug coverage and 79 percent provide dental plans.
The survey results also are broken down by industry type, size of company and worker demographics.
The online tool is based on surveys with more than 1,600 executives nationwide as well as interviews with 1,380 workers.
Some of the results, Nugent says, have been surprising.
Young workers those aged 21 through 35 give more importance to the availability of dental benefits than they give to paid vacation.
That sort of information can be especially important to companies that are seeking to tailor a health benefits package to a specific portion of the workforce.
And workers at small companies, the MetLife surveys found, give more importance to health benefits than they give to company culture as a factor in loyalty to their employers.
The biggest benchmarking study in the nation is conducted by United Benefit Advisors, an Indianapolis-
based advisor to 165 benefits companies in the United States and Canada.
The most recent UBA benchmarking study surveyed 12,860 employers some 50 percent more than the number of companies involved with the first survey five years ago.
That growth in participation is a clear mark of the importance that employers are giving to studies that benchmark health benefits, says Bill Stafford, UBA's vice president of member services.
"There's no other way of getting that information without a good benchmarking tool," Stafford says. The information is particularly useful, he says, to companies with multiple locations in several states.
He says UBA's member firms have generated some 30,000 requests for the benchmarking study.
The group makes some national data available on its Web site, (unitedbenefitadvisors. com). The average health plan cost per employee nationwide, it reports in one example, is $7,327 for medical only, with employers paying an average of $4,117 and employees paying $3,210.
But detailed state and local data is available only through UBA member companies, and there aren't any with offices in Nevada.
Commonly, Hendricks says, executives will simply call a few friends at similar companies and develop their own informal benchmarking study.
