Growing Hotel Chain’s Caring Culture Pays Decades of Dividends

How one hotelier’s bold break from the insurance status quo sparked a nationally recognized model for employee health care, community transformation and workforce stability.

In October 1991, Harris Rosen had an epiphany. He expected his company’s health insurance renewal would be significantly lower than the previous year based on more favorable claims experience, but to his surprise, the quote was higher. The trouble was that Rosen Hotels & Resorts was part of a fully insured group that didn’t perform well. Learning the stark details proved to be a watershed event for the business he built 51 years ago.

“Mr. Rosen said, ‘I don’t want to be a part of the group anymore. Let me perform on my own merits,” explained Ashley Bacot, health plan architect at RosenSure, an independent insurance agency that serves what has become the Southeast’s largest independent hotel chain with seven properties and more than 4,000 employees. “They (the insurer) said, ‘We can’t do it that way.’ And Mr. Rosen said, ‘I’m out.’ And that’s when he switched to a self-insured group health plan.” 

Rosen then went much further than most CEOs to reduce costs while also ensuring better access to quality care for his workers and their families.

Rosen’s coverage now features direct contracting with medical providers, an independent third-party administrator, an imaging facility where MRIs and CT scans are one-third to half the cost of those in a traditional health insurance setting, a transparent pharmacy benefit manager (PBM) and an onsite medical center with multiple doctors and a staff of more than 60. About a year ago the company also partnered with PeopleOne Health, a pioneer in so-called “value-based” primary care.  

A Nationally Recognized Model

The company’s RosenCare model, which has earned national recognition as a patient-centered onsite medical home, has been rolled out to a dozen other employers across Florida. Included in that mix is the Osceola County school district, with about 10,000 employees and dependents, as well as Orange County public schools, the nation’s eighth-largest school system. RosenHealth, launched last year, gives brokers from across the country access to the RosenCare model. The hope is that brokers will be able to offer the Rosen approach to health care benefits to employers outside Florida.

Where it excels is not only “recognizing the needs of the population and provision of the service based on their demographics, but also tying it together with the health plan,” said Kenneth Aldridge, Jr., director of health services for Rosen Medical Center/RosenCare/RosenHealth. “Our focus on access, quality, service, cost and innovation is what makes us different. We’re proactive instead of being reactive.”

Employees and family members have their conditions and treatment needs assessed before they visit the onsite clinic, where they can also have lab work done. For example, they may be asked about the last time they had a colonoscopy, colorectal screening, mammogram or cholesterol check.

Aldridge notes that 20% of Americans don’t realize they have diabetes. The same goes for hypertension, which he says is another cost driver.

But Rosen’s attention to detail goes even further. “We have people coming from other countries who never had health care, and their diabetes or blood pressure is out of control, and we’re seeing them for the first time, providing them health care,” he said.

Aldridge added that as much as 75% to 85% of an employer’s health care spend is on chronic care conditions, but that outreach to those individuals often falls short. The U.S. health care system typically waits for them to come forward and seek treatment, “because insurance companies and employers are not being as proactive as they could be,” he said.

Rosen Hotels & Resorts’ employees do not pay an annual deductible or coinsurance, while co-pays for a primary care physician visit are either zero or $5. Nearly 90% of medications, including insulin, are available at no cost, while out-of-pocket costs for the remainder of prescription drugs range from zero to $25. Aldridge said the company’s approach to health care benefits is one of the main reasons why turnover is a fraction of the company’s competitors in the hospitality industry.

“The only big copay we have is $750 for a hospital admission, regardless of whether it’s for a heart or bone-marrow transplant or a premature baby delivery, which can cost several hundred thousand dollars,” he said.

Transforming an Entire Community

Rosen, who died at age 85 just before Thanksgiving last year, had long believed there were two American institutions in dire need of reform: health care and education. In the communities Rosen now serves, there has been a convergence of the two, producing success stories that paralleled one another. For example, Rosen created foundations to help uplift Tangelo Park, which 30 years ago was an underserved neighborhood with a high crime rate. Today Tangelo Park offers free preschool for young children and college or vocational school scholarships for students after they graduate from high school. The goal is for them to graduate debt-free. Since the beginning of Rosen’s support to the community, crime has plummeted and high school graduation rates have soared to 100%. The success of the Tangelo Park Program led to the creation of a similar program in Orlando’s Parramore neighborhood.  

Other investments that have paid dividends include funding from the Harris Rosen Foundation earmarked for the Rosen College of Hospitality Management at the University of Central Florida, the Jack and Lee Rosen Jewish Community Center, and the Rosen Aquatic and Fitness Center.

“We’ve taken almost $600 million in savings from our employee health benefits and put it back into the community,” Bacot said.

The Rosen Scholarship programs have since produced their share of successful professionals who have returned to serve their communities. It is what the company describes as “a virtuous cycle of success and service.”

Harris Rosen was engaged not only in his company but also in the community at large. “When a lot of people give back to the community, they write a check,” Bacot said. “That’s wonderful, but he got involved. So, when I talk about those kids who graduate from high school, Mr. Rosen paid for their college. Mr. Rosen also went to all those preschool graduations. He really stayed involved with them.”

Rosen Hotels & Resorts’ culture of health and wellness was built and nurtured from the top down. Bacot said Rosen used to swim a mile and a half a day and paid attention to his diet. “He was incredibly passionate. He walked the talk.”

Paying Workplace Dividends

By reimaging health benefits, the company seeded a larger business dividend. Turnover in the hospitality industry is about 75% – and sometimes 100% in the food-service part of the business, said Aldridge. “We’re in the low double digits. We have families that have four generations working for Rosen Hotels.”

Bruce Shutan is a Portland, Oregon-based freelance journalist who has written about employer-provided group health benefits for 37 years. He is a contributing editor of Employee Benefit News and regular contributor to The Self-Insurer magazine, published by the Self-Insurance Institute of America.