CORAL helps users quickly estimate relative values of different health benefit plans. It lets you see how changing a multitude of variables such as copays, deductibles, and coinsurance rates will affect your per-member-per-month cost. CORAL makes benefit calculations easy and helps you gauge the effects of healthcare reform.
Michael Sturm: Healthcare has changed tremendously in the last year or two. The costs have become so large relative to raw materials that they purchase for other industries that they're involved in that there isn't a CFO in the industry that isn't worried about healthcare costs right now.
Barbara Collier: It's certainly difficult to be a benefits manager these days, because the things that you used to know are not so certain anymore, and you're trying to guide the people you're working with, the people you're reporting to, towards the right answer when you're not even sure you know all the factors.
Robert Karp: For a long time employers were merely just preoccupied with how much does it cost. More and more we're seeing employers are looking at their health benefits as part of their total compensation package. It's really been a shift over the last several years. How do I keep my people happy? How do I keep them healthy? How do I keep them here present at work and not off work because they're ill? All that is part of the employer's global strategy of controlling their healthcare costs.
Michael Sturm: Because healthcare has become so expensive most employers are reducing their benefits. That is, they're increasing their deductibles, coinsurance, and copays. A common challenge my health plan clients have is pricing those reductions and benefits.
Barbara Collier: The expense of healthcare benefits is certainly a major consideration, which is why it's important to find the benefits package that will provide the maximum benefit to your employee without incurring significant additional costs for the employer.
Comparing apples and oranges
Robert Karp: One of the basic questions that a self-funded client is going to have is "What is the relative value of one benefit plan to another?" be it for their own internal purposes, benchmarking against a competitor or just against industry averages. That question comes up. You can get that answer from a TPA or a stop-loss carrier or any other third party. You'll get an answer that suits or is slanted to their individual needs.
Michael Sturm: We frequently would spend 10 to 20 hours estimating benefit relativities and ultimately decided that we needed a tool that could do it more quickly. Once we developed that we found out that our clients were interested, and we decided to lease it to them as well.
Barbara Collier: When you're looking at determining what set of benefits to offer and what it should cost and how you should price it out, the CORAL model is built for the purpose of testing a lot of different things without it taking up days or weeks of your time.
Robert Karp: Each client that I work with is unique, and they've designed benefit programs that are unique to them that best suit their needs. And CORAL goes hand in hand with that. If there were a finite number of benefit plan designs we wouldn't need a tool like CORAL. Once you've rated them all you're done. But it's not the case.
The Coral advantage
Michael Sturm: Estimating benefit changes is extremely complex. CORAL quickly and easily allows the user to input their benefit plan design features and then gives the user a cost difference based on those benefit design differences.
Emily Jayne: When our clients see CORAL for the first time they are able to see the interface and just how easy it is to use. They're able to store a number of plan designs in CORAL and pull up relativities quickly, and not just relativities, but also they can see the impact to their members, and that's a huge deal for them as well.
Barbara Collier: One of the things that we love most about the CORAL model is it's designed and laid out in a way that a lot of benefit teams think. It's set-up with grouping services together where all of your hospital services will be in one group, where all of your outpatient services, inpatient services, and then all of your professional items lay out in a line-by-line way using common terms that benefit managers are comfortable with.
Robert Karp: Some of the niceties of CORAL. It's Web-based, so I don't have to be at my office to use it. The interface is clean and slick, it's intuitive. It's responsive, which is always nice in a tool, and it's user-friendly. It's very easy to find work that you've done previously. You don't have to spend a large amount of time finding things.
Emily Jayne: Our clients can have multiple users simultaneously building off of one another's plan designs, and you can also just get to actuarial results without needing an actuary, which is huge savings of time and resources.
Powered by ten years of experience
Michael Sturm: We based this tool off of millions of lives, where most health plans and employers just don't have that experience.
Emily Jayne: The CORAL model is built on the Milliman Health Cost Guidelines, which has over 60 million lives backing it, and so there's a lot of data to support it. And not only does that back the model, but we can tailor that to the specific client's experience by tweaking the demographics behind it or the area and pull in adjustments to specifically tailor to them.
Barbara Collier: There are two major differences between the CORAL model and the federal calculator. One, the federal calculator does not have a robust method of testing the impact of plan changes on a member's behavior. And, two, while the federal calculator can tell you that you can offer these 10 plans that fall within your metal level, the CORAL model will be able to tell you which of those plan designs is the lowest cost and gives you the best bang for your buck.
Emily Jayne: The actuarial value calculator that was released by the government is more of a regulatory compliance tool, and the CORAL model is really the supplement to that and is a very necessary supplement for our clients. They're able to use our tool to determine within a given metal tier, so two different silver plans, which one has the most savings to them as well as the least impact to their members.
Adding value through objective evaluation
Michael Sturm: Working through the numbers is definitely worth the due diligence. If you're talking about an employer with just over 100 employees, they could be paying close to a million dollars in medical expenses in a given year. A five percent mistake costs them $50,000. That to me seems worth it.
Barbara Collier: Everyone can benefit from the CORAL model. End clients can use it for pricing purposes when they're developing rate increases. In addition, brokers when testing out benefit packages for their clients have expressed a lot of excitement about the tool because it makes their job so much easier, especially at a time when they're looking at multiple renewals at the same time, and testing things and doing the back of the envelope is not only scary but way more time-consuming than they can hope to accomplish.
Robert Karp: Through CORAL we can give the client the best objective answer possible. And I don't mind telling you that throughout the insurance industry, whether you're a carrier or a broker like myself, or a consultant I should say like myself, Milliman is very commonly regarded as the gold standard of objectivity. So there are other products out there. We're aware of that. But more insurance companies rely on Milliman for their advice than any other actuarial firm.