It’s hard to think of a company that seems less likely to transform healthcare. It isn’t headquartered in Silicon Valley, with all the venture-backed start-ups. It’s not among the corporate giants—Amazon, Berkshire Hathaway, and JPMorgan Chase—that recently announced, with much fanfare, a plan to overhaul the medical-industrial complex for their employees.
And it is among the most hated companies in the U.S., according to many surveys on customer satisfaction. The nation’s largest cable company—the $169 billion Philadelphia-based behemoth that also controls Universal Parks & Resorts, “Sunday Night Football,” and MSNBC—is among a handful of employers declaring progress in reaching a much-desired goal. In the last five years, the company says, its healthcare costs have stayed nearly flat. They are increasing by about 1% a year, well under the 3% average of other large employers and below general inflation.
“They’re the most interesting and creative employer when it comes to healthcare benefits,” said Dr. Bob Kocher, a partner at Venrock, a venture capital firm whose portfolio companies have done business with Comcast. (The cable company declined over several months to provide executives for an interview on this topic.)
Comcast, which spends roughly $1.3 billion a year on healthcare for its 225,000 employees and families, has steered away from some of the traditional methods other companies impose to contain medical expenses. It rejected the popular corporate tack of getting employees to shoulder more of the rising costs—high-deductible plans, a mechanism that is notorious for discouraging people to seek medical help.
Most employers now require their workers to pay a deductible before their insurance kicks in, with individuals on the hook for $1,500, on average, in upfront payouts, according to the Kaiser Family Foundation. Instead, Comcast lowered its deductible to $250 for most of its workers.
Cable TV subscribers who have felt confused and overwhelmed when dealing with Comcast customer service may be surprised to learn how nimbly the company has upgraded services for its employees. While Comcast continues to work with insurers, it has largely shunned them as a source of innovation. Instead, it has assembled its own portfolio of companies that it contracts with, and invests in some of them through a venture capital arm, Comcast Ventures.
One such company is Accolade, in which Comcast is an investor, and which provides independent guides called navigators to help employees use their health benefits. Another, called Grand Rounds, offers second opinions and help in finding a doctor. Comcast was also among the first major employers to offer workers access to a doctor via cellphone through Doctor on Demand, a telehealth company.
The corporation, of course, is controlling costs and offering these unusual benefits out of self-interest. And these services are sometimes handed out at the expense of improving wages. In a tight labor market, Comcast also needs to remain competitive for not only highly skilled employees, but also lower-wage workers whose direct contact with customers has generated so much dissatisfaction over the years.
But much of what sets Comcast apart is its willingness to directly tackle its medical costs rather than relying on others—insurers, consultants, or associations. It’s a luxury only the largest companies can afford, and roughly a fifth of big companies continue to see annual cost increases of more than 10%, according to Mercer, a benefits consultant.