This post is one in a series of Featured Listening Posts highlighting Listening Post Project participants employing innovative strategies and techniques to address the key challenges we have analyzed in recent Listening Post Soundings.
The North Carolina Symphony was founded in 1932 in the midst of the Great Depression. Truly the “people’s orchestra” since its inception, the Symphony has dual legacies of statewide service and music education. Today the Symphony performs 175 concerts each year, in a concert season that takes the orchestra to venues of various shapes and sizes across the entire state of North Carolina, from the Blue Ridge Mountains to the Outer Banks and many places in between.
Have your healthcare costs been going up over the past few years? If yes, by how much? Did this have any impact on services, staff retention, etc.?
Up until FY2008, the total cost of health care to our company had increased by more than 100% over a 10-year period, including 27% over the immediate prior two years alone. While health care costs have not directly impacted our organization’s ability to fulfill its mission, they have without question put a strain on available resources and have limited our ability to compensate our employees as we would have liked.
Can you describe some of the innovative ways in which your organization reduces the cost of health insurance plans for its employees?
At the suggestion of its musicians, the Symphony began exploring some of the more recent products that have become available for employers in the health care arena. In our case, moving to a high-deductible plan paired with a Health Savings Account (HSA) looked like a very strong option. Working with our insurer (Blue Cross/Blue Shield of North Carolina), we were able to continue to offer our more traditional PPO plan as well as this new HSA option. The HSA option was so successful that, with more than half of the employees migrating to this plan, we were able to avoid any premium increase at all (for both PPO and HSA combined) for FY2009 and FY2010. In this day and age, we considered holding health care costs flat an enormous success.
What are the advantages and disadvantages of this HSA plan?
The most obvious disadvantage is the high deductible; however, when you run the numbers, many employees come out ahead despite the deductible. From the employer perspective, it certainly empowers employees to make thoughtful choices in their health care decisions, and provides them with total control and flexibility as to which providers make the most sense for their respective situations. It also rewards savings, as unspent health care monies roll over from one year to the next and, over time, an employee can bank a significant amount of resources against unforeseen circumstances. The HSA plan also encourages employees to get annual physicals and screenings (such as mammograms) by covering 100% of these costs.
What could others learn from your experience?
We have learned over the years that flexibility and adaptability are both key, and as we’ve migrated from self-insured to a traditional PPO plan to this HSA plan now, we’re putting more options in the employees’ hands which benefits everyone. Probably the single worst mistake we could have made in health care would have been to assume that options were not available, or that those options would not create potential savings. Even the process of shopping for coverage can be entirely positive. In our case we’ve wound up with a solid plan which offers good benefits at a price that the employer and employee can both afford.
What policies would you like to see in health care reform?
Here at the Symphony, our policy advocacy is primarily limited to music education policy and support for the live performing arts at the federal, state and local levels. However, as a relatively small employer, any health care policy that would allow small employers to pool their employees together for risk management purposes would strike us as a positive development. The more people that are insured, the better for all concerned.
What do you think is the most pressing issue facing nonprofits like yours right now?
Stability and predictability of revenue streams are our biggest challenges. Whereas in the past it seemed reasonable to budget three to five years out, today our planning cycles have to be much shorter and more frequent. Especially in an environment of reduced wealth and, for many, income, it is incumbent on us that we learn to be more creative with how we raise money and spend our limited resources.
What is the most rewarding part of your job/being part of the organization?
We’re fortunate enough to work in a field that is full of terrific people with whom we share a common passion for great music. Especially in trying times, to be able to come together and experience music-making at the highest level is rewarding, refreshing, and joyful. Whether it’s a performance for fourth- grade students in a small school in rural North Carolina or a major classical event at our home concert hall in Raleigh, we feel that every time the orchestra takes the stage is an important event to the people of our state.
What do you find to be most valuable about participating in the Listening Post Project?
The Listening Post Project provides us with an opportunity to reflect on issues that are important to non-profit organizations in a broader way than focusing on our particular industry.