Industry:
International Manufacturing and Services Conglomerate
Employees:
150,000 worldwide; 40,000 in the US
Challenge:
A corporate divestiture led to significant challenges which had caused the plan to run at a significant deficit. Among the challenges, was that the historical experience for the combined entities had not been separated by business unit under the legacy contract and there was a single, inadequate rate for active and retired employees.
Solution:

Removing legacy benefits, to achieve cost savings.

  • Using a custom developed auditing tool, we were able to separate legacy premiums by business unit and separate claims by social security numbers to determine a reasonable claim cost for the new company.
  • Using reliable data and a clearer picture of how the new, streamlined organization would fare from an actuarial perspective, we created a scenario that gave several major carriers the confidence to get much more aggressive with their quotes.
  • In addition, we worked closely with the benefit administrator and the new carrier to ensure an efficient, electronic enrollment, EOI processing and plan management solution.
Outcome:

We were able to achieve cost savings and a six-year rate guarantee, while also meeting all of the client’s objectives.


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