Insuring the Uninsured: Altruism and Self-Interest Meet

I love to see creative market solutions to tough problems. This piece, from CFO, is a perfect example.

Employers have been struggling for years with the ever-rising cost of their traditional health-benefit plans. As a result, they've had to ponder whether to boost employees' out-of-pocket payouts or, in a less common scenario, to cut back on benefits. In either case, employee relations — not to mention labor negotiations involving benefits — can get touchy these days.

With all the energy that companies have been expending on such choices, it's fair to wonder why 58 Fortune 500 companies would participate in the National Health Access program, which is aimed at providing up to 3 million uninsured workers, independent contractors, and pre-Medicare retirees with low-priced health-care coverage. Among Corporate America's many virtues, altruism isn't the first that springs to mind.

On the other hand, it's easy to see why UnitedHealth Group, Humana, and Cigna are thrilled to provide the insurance. National Health Access will supply these three companies with an excellent entr´┐Że into a potentially huge new pool of business. What's more, the new policies could help them replace employee-benefits revenues that they lost during the last five years or so, as a result of downsizing and outsourcing by many employers.

It does seem a little surprising at first, until you realize the good business decisions behind it. Here is the best part of the article:

One reason offered by participating companies is that by providing uninsured workers with access to health coverage, a company can improve its overall performance. "I don't think it's a matter of altruism; it's a matter of enlightened self-interest," suggests Robert Galvin, director of corporate health and medical programs at General Electric Co. "If [employees] are not getting health care when they work for us, they're not going to be productive." Galvin acknowledges, however, that employers haven't been able to quantify how much productivity is lost due to a lack of health coverage.

Exactly. So many companies focus on building profit through hype and chicanery (which usually leads to short-term profit and long-term failure) that we forget the times like this, when businesses find win-win solutions that benefit all parties in some way.

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