#co_health chat recap: tesla motors lowers barriers to health with free health care

June 26, 2012

in cohealth

the following is a recap of june’s #co_health tweet chat. these chats are held the third wednesday of each month at noon EDT. refer to our 2012 calendar for what’s coming up.

“no employee should pay for a broken system and go broke.”

that’s nate randall, tesla motors’ benefits manager, explaining what lies behind tesla’s approach to health, an approach branded and delivered as “the tesla life.” that lifestyle includes all of the benefits, perks and resources tesla offers employees, including no-premium health care benefits, free preventive prescriptions, onsite gardens and produce, and a ride in a tesla roadster. (sign me up!) fundamental to the lifestyle are the guiding principles underpinning it: no barriers, do the right thing and create simple habits.

in application, these principles led tesla to the atypical decision of providing health benefits to employees for free—no out-of-paycheck premiums. employees choose from a high-deductible plan, a PPO or an HMO, and there are no hoops. dependents, too, get free coverage under the high-deductible health plan and can buy up to the other two plan choices. making health plan coverage affordable is something tesla prides itself on, and also brands. their “health plan for all” ensures that no tesla employee goes without basic coverage. today, 99% of eligible employees have health care provided by tesla.

tesla’s no-hoops approach to health plan benefits is quite different from the one taken by nate’s former employer, safeway, who’s best known for its well-publicized approach to health coverage. safeway uses an outcomes-based approach to wellness, connecting health scores to incentives. employees receive premium discounts for each healthy score they receive related to cholesterol, weight, blood pressure levels and tobacco use. nate declined to comment on what lessons he took from his time at safeway.

tesla currently has 1,700 employees and is experiencing rapid growth, doubling its size every year. so far, that growth has placed no strain on tesla’s approach. they, in fact, view it as an opportunity. with 50 new employees joining each week, tesla uses onboarding to steer people toward the tesla lifestyle.

onboarding becomes just one touch point for new employees and family members. other touch points are created via in-person meetings, direct-to-nate calls, and an always-open-for-business and mobile-optimized wellness portal, as well as family events and gardens. tesla also looks for opportunities created by employees. when a number of employees started cycling to work, nate and team got to work and built them showers.

it’ll take some time before we can see what outcomes tesla’s approach delivers. for now, nate and his team are focused on data collection. they’re looking at preventive care utilization, prescription utilization, health care costs. “anything we do, we measure,” remarked nate. they also measure and respond to employees, using surveys to find out what’s working and what needs tweaking.

nate knows they’ve work to do. he’s trying to perfect how you get the right program to the right person at the right time. but he and his team feel confident they’ll have rich data to review and respond to by first quarter 2013. that’d be a good time for us to check back with him.


up next on cohealth:

  • cohealth checkup radio show (wednesday, july 4, noon EDT): a prerecorded show with jane sarasohn-kahn on health care reform, open enrollment and measurement
  • cohealth tweet chat (wednesday, july 18, noon EDT): wendy lynch on creating human capital value



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