Research Paper on Fedex
1. In the light of the recent increase of health care insurance costs for employers, many of them decided to revise their insurance policies. Paying out employees’ and retirees’ health benefits resulted in tremendous liabilities for American businesses. In certain cases, health care costs exceed returns from productive workforce and can hinder the company’s competitive position. Increasing insurance costs have negative effects on the workplace situation, as the employers are forced to hold back wage increases, raise co-pays and deductibles, and ask workers to shoulder a larger share of premiums.
Multiple health care plans at Fedex should be regarded as a right move in this situation. Rather than relying on traditional HMOs and PPOs, the company allowed its workers to choose providers both inside and outside the network; however, those enjoying “freedom of choice” had higher co-payments and payroll deductions. Some other companies have implemented similar initiatives, sometimes referred to as fee-for-service arrangements, which imply reimbursement of health care expenses after an employee receives them from a provider of their choice. This idea emphasizes individual responsibility for choice and usage of health care services; it also increases the quality of health care through applying the free market mechanism of competition.
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Fedex also started offering four different levels of coverage. It helped them to decrease costs even further: rather than offering a uniform policy to all employees – which was likely to be perceived as unreasonably expensive by both the company and majority of employees – those willing to have a more comprehensive coverage were free to pay for such additional service.
A reform of benefit policy appears very timely for all businesses; designing an attractive benefits policy is of paramount importance. In the modern business environment, competitiveness of a company to a large extent relies on its human capital. It is crucial for a business to attract the most qualified employees, and health benefits can be a good incentive for them.
2. Various health promotion initiatives – such as disease management programs, training programs, and nursing hotline – are a great way to reduce health care insurance costs. Moreover, they enhance workers’ motivation and, consequently, productivity. They contribute to the improvement of health condition of the labor force, which also increases productivity. They foster ties between the company and employees and prevented turnover. Finally, they contribute to higher employee satisfaction.
Fedex is not alone in what they are doing. Many employers have already shown interest in promoting healthier behavior of their workers in order to reduce costs of health care by using employee assistance programs, educational programs, preventative care offerings, case management, disease management and other programs. The term “wellness” encompasses much more that mere employee health benefits. Such initiatives are usually grouped as occupational health and safety initiatives (immunization, health risk screening, ergonomics programs, massage therapists), voluntary health practices (smoking cessation, healthy eating, weight control, active living, on-site fitness centers), and organizational change initiatives, that is, initiatives aimed at reducing work-related strain (stress management, flexible working hours, recognition and reward).
Fedex offers initiations in the first two categories. Its lower-back pain cessation program can be classified as health and safety initiative, while onsite fitness centers and initiatives aimed at raising awareness about medical issues are best seen as promoting beneficial voluntary health practices. There is a direct link between such initiatives and lowering the costs of health care insurance. Since many Fedex workers need to lift heavy boxes on a regular basis, health promotion is a must for them. Prevention and early diagnosis have been long recognized as the best way to tackle the issue of illness: a nursing hotline is aimed exactly at that.
Therefore, it is possible to conclude that the issue of employee health has been firmly placed at the top of the agenda by all leading companies including Fedex. Business leaders and human resource managers came to realize that healthy and productive workers are the main asset of their companies. Moreover, a right thing for Fedex was publicizing its effort aimed at promoting health and offering more flexible benefit schemes: its health benefit center furnished all information an employee could potentially need. If health promotion initiatives are not coupled with an information campaign, employees will not take advantage of various options available to them. What would be the use of an onsite fitness center and nursing hotline if no one was informed about it? Thus, the overall assessment of Fedex initiatives for holding back the increase in health care insurance spending – in terms of both effectiveness and comprehensiveness - should be very positive.
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