By Jeannie Fanning
April 16, 2012

Mayors in cities across the country face unprecedented challenges in providing competitive benefits for city employees while still controlling costs. Obstacles such as revenue decreases of 22 percent from 2008 to 2009 and increased public scrutiny of government spending add to strain. Luckily, cities have access to many proven solutions that can help them control and even reduce costs while continuing to offer a strong benefits package for their dedicated employees.

Colonial Life’s new white paper, “Preserve and Protect: How Public Sector Employers Can Provide Excellent Benefits While Controlling Costs” uses proprietary and industry research and case studies to explain the reasons for the growing cost pressures and show the effectiveness of multiple strategies to contain benefits costs in a time when the cost of family health care coverage has doubled in the last decade, increasing nine percent in 2011 over the previous year.

“In today’s economy, most people realize changes in benefits programs are inevitable,” says Pat McCullough, assistant vice president and public sector practice leader at Colonial Life. “But many employers, especially those in the public sector, aren’t taking advantage of the opportunities available to them. They’re more likely to be able to continue offering competitive programs if they find ways to make them more cost-effective.”

In partnership with The U.S. Conference of Mayors, Colonial Life is working to bring awareness of these cost containment strategies to mayors and their cities. The top five strategies examined are wellness initiatives, Section 125 participation, benefits communication and education, using employee paid voluntary benefits, and conducting a dependent verification.

Cities and other public sector entities that implemented strategies such as these report significant savings in their employee health care benefits. More than half — 55 percent — of participants in a government financial officers study saved at least six percent, and 40 percent of them saved more than ten percent. Other studies show employer return on investment for wellness initiatives ranging from $3 to $6 for every dollar spent.

The Colonial Life white paper illustrates how cities and other entities can save money and preserve the value of their benefits packages by carefully selecting the most effective combination of strategies for their situations and needs, including enlisting the often-free support of qualified benefits providers. By considering all the aspects of a city, such as the number of city employees, political environment, cost management goals, impact on employee health, and access to care, mayors and other city leaders can select from a range of cost saving options while educating and providing great benefits for their employees.

“Focusing on the right cost'saving measures could have a significant impact on the bottom line while minimizing the impact on employees,” said Conference of Mayors CEO and Executive Director Tom Cochran. “Thoughtful implementation of strategies appropriate for each employer can help them continue to offer a stable benefits package in a more financially sustainable way.”

The complete white paper is available in Colonial Life’s online newsroom at ColonialLife.com. For more information on how these strategies could help your city’s employee benefits, contact Kathryn Kretschmer-Weyland with the Conference of Mayors at 301-460-5251 or e-mail kweyland@usmayors.org, or contact Jeff Bean at 202-446-8140 or e-mail jbean@usmayors.org.