Question

TOTAL REWARDS ANALYSIS 1

Total Rewards Analysis

Deyanira Diaz

Southern New Hampshire University

OL 620

April 25, 2022

Case study assessment

From the information shared in the case study, it is evident Emerging pharmaceuticals have a total reward system that they use to reward employees in the full-time and part-time categories of working. For starters the reward system has two different health options employees can select; the Value Preferred Provider Plan (Value PPO) and the Choice+ Preferred Provider Plan (Choice+ PPO). With Value PPO, one gets to pay less on weekly basis but have to pay some cash while receiving services. The option also has a high penalty in the case an employee seeks services from providers not captured in the provided network.

On the other hand, the Choice+ PPO has higher bi-weekly costs and in the case of receiving services, the patient pays little cash and at the same time the option has a wider range of network providers employees can seek services from. From the figures provided, there is only a minimal difference between the two options. For instance, Value PPO charges bi-weekly cost of $57.50 for employee only while as Choice+ PPO charges $86 for employee only. But in the case there is another dependent for instance a spouse, the first option charges $157 and the other $141 respectively. In the case there is a child involved making dependents two or more in number, the first option charges $257.50; while the second option charges $500.50

On dental health, there are two options; basic which is much cheaper but fewer benefits attached and the premium option which is slightly costly with higher levels of benefits attached. It is also a good thing that the emerging pharmaceuticals have a plan for vision medical services. Nonetheless, there are important notable gaps in the system that should be used in making necessary revisions. For instance, employees under Value PPO being penalized for not using the network providers are a major gap. Another gap is on the slight difference on charges and a huge difference in services offered.

Areas of misalignment

Comparing the two different system, it is evident there are specific factors that entices employees to Medtronics. This is because the Medtronics system has offered some important valuable services and options that would make the employees to value their health while receiving the best possible services in the case they need the services. One of the major areas of misalignment is on generic drugs which the Medtronics system ensures that employees get to receive quality drugs to aid in their recovery. When it comes to the emerging pharmaceuticals system, there is no way that generic drugs are covered and this means that after receiving treatment, the facilities are not concerned on the kind of drugs employees take.

The second major misalignment is on healthy activities that employees should partake in. in the case study, there is an employee who has raised a concern that despite ensuring that he lives a healthy life, he is never compensated. On the other hand, the Medtronic system has a way of making sure that any healthy activity the employee and direct dependent engages in is accounted for and rewarded in terms of points. The employee has a right to redeem the points by receiving valuable goodies from the company since healthy activities saves the facility from paying medical bills. As proven by De Gieter, & Hofmans, (2015), Medtronics systems encourages employees to stay and live healthy something that emerging pharmaceutical companies do not.

Another important misalignment is on contributions which shows that Medtronic has a way of reviewing contribution amounts evident in newly hired employees something that emerging pharmaceuticals do not have. With charges being reduced communicates a message to employees that the deductibles would reduce with time and this means more earnings on their part while remaining fully covered by their health insurance options. Lastly, when it comes to basic and comprehensive plans, there is a noticeable difference in terms of contributions something that is not evident in emerging pharmaceuticals.

Strengths and weaknesses of each plan

The two plans despite sharing a series of misalignments has some areas that makes them strong and other areas that displays total weakness. Starting with the emerging pharmaceuticals, the system has a major strength in the sense that it has set figures that a majority of employees can afford (Libbertz, 2019). This is to mean that it is the decision of the employee to determine which option to select. Secondly, the companies have selected service providers known for offering quality services which is a huge benefit for the employee. Nevertheless, the system has a weakness in the sense that it is not clear on how much employees would have to pay in cash given that medical conditions differs when it comes to treatment.

Focusing on Medtronics system, there is a major strength is the sense that the system only deals with professionals. It is also a system that encourages healthy living and motivates employees to live a life where they would keep physicians away (Mabaso, 2018). However, the system is slightly costly as compared to emerging pharmaceuticals and this means employees have to be deducted much more. Additionally, it is a system that creates inequality between older and new employees from the significant charging differences. The older employees have to pay much more as newly recruits who have their prices revised.

Data analysis comparison

It is important for the emerging pharmaceuticals to make necessary changes that would lead to the creation of better working environment that would increase employee retention. The more reason is that with the changes implemented more than 15,000 employees that would benefit globally. This is a relatively high number given the fact that there are many other who could have been discouraged by unacceptable reward systems in the industry leading to changes in career. The employees in the industry would be encouraged to engage in healthy activities as well as quality services from selected providers. This is not ignoring how the changes would make it possible for the industry to partner with diverse number of providers across the globe granting employees a series of options to select from. Lastly, the changes would reduce the amount employees would have to be deducted as well as out-of-pocket contributions for service delivery while scrapping off any fines associated.

References

De Gieter, S., & Hofmans, J. (2015). How reward satisfaction affects employees’ turnover intentions and performance: an individual differences approach. Human Resource Management Journal, 25(2), 200-216.

Libbertz, M. A. (2019). Reward-based Crowdfunding: Reward Characteristics and their influence (Bachelor's thesis, University of Twente).

Mabaso, C. M. (2018). Total Rewards as a Psychosocial Factor Influencing Talent Retention. In Psychology of Retention (pp. 415-433). Springer, Cham.