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Hospital CEO Richard Weber was facing a difficult decision regarding employee benefits for the $1,200$ doctors, nurses, and administrative staff working in his large health care center. The costs of employee benefits had continued to grow and now accounted for a large percentage of the total compensation package at the hospital. Weber tried to review his options.

Benefits were often used to attract potential employees to the hospital. In addition, Weber believed that the tax treatment of benefits was more valuable to employees than if he were to offer higher salaries, and he knew the hospital insurance rates were much lower than those the employees would be able to find on their own. Finally, state and federal laws required many of the benefits.

He worried that if he changed the benefits package, he would have dissatisfied workers and increase the risk of losing talented employees. Weber knew that he could potentially reduce specialized programs such as the $16$ paid hours per month he provided employees to do volunteer work, but he felt that those programs were valuable and enriched outreach to the surrounding community. The cost of benefits just kept growing, and Weber was stymied as to how to keep employee benefit costs at a manageable level.

$1$e$.$ Looking beyond this year, when he expected...

Looking beyond this year, when he expe$$ed to have even greater employee benefit expenses. Weber could take steps to get the full value of the cost of benefits and motivate employees by