Anthem is the latest large employer to reward its employees in response to changes in the corporate tax code.
The health insurance giant — which serves more than 73 million people through its affiliated companies — announced it will contribute $1,000 to the 401(k) accounts of more than 58,000 employees and recent retirees, for a total of $58 million.
“This new program is an opportunity for us to thank our associates and also ensure that they benefit from the recent changes to the U.S. tax code,” Gail K. Boudreaux, Anthem’s president and chief executive officer said in a statement. “It is our hope that, by contributing to our associates’ 401(k) plans, we are able to offer a program that will help them and their families now and in the future.”
4The company said that full-time, part-time and temporary employees are eligible to receive the contributions. For those who weren’t already participating in the company’s workplace-sponsored plan, Anthem will automatically create 401(k) accounts for these individuals and make the $1,000 investment. Employees will receive the contribution on March 29 and will have the opportunity to choose how the money is invested in their retirement accounts from the 15-item investment menu available within the company’s 401(k) plan.
In addition to the Anthem 401(k) program, the company plans to invest savings from the tax code changes — which slashed the corporate tax rate from 35% to 21% — to help reduce healthcare expenses and benefit the consumers it serves.
Anthem had a strong year in 2017, with operating revenues growing 5.8% year-over-year to $89.1 billion. According to the company’s year-end financials, net income was $14.35 per share and operating cash flows grew by 28% year-over-year to $4.2 billion in 2017.
In its fourth quarter earnings call on Jan. 31, Boudreaux said she has challenged the company to “have a relentless focus on day-to-day execution in order to deliver continuously greater impact on the affordability and quality of healthcare in America. Specifically, we need to advance our consumer-focused innovation and data analytics capabilities to leverage our strong brand and local market position and drive greater value for our customers.”
To do that, she believes Anthem needs to focus more on developing innovative solutions that emphasize affordability and flexibility.
“We will continue to focus on the drivers of medical costs and identify new ways to deploy cost of care solutions more quickly and effectively so that we can further improve the quality of care our members receive while also reducing the cost they incur,” she added.
In 2018, Anthem plans to use a portion of its corporate tax reform benefits for incremental investment spending in the areas of technology modernization, consumer-facing digital technologies and product development capabilities, Boudreaux said. It will upgrade its technology, including new digital and mobile capabilities. It also will invest in new external-facing applications and portals “that will make it easier for members, agents and care providers to conduct business with Anthem” and will improve and personalize customer support, she said.
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