Health Plans: Self-Insured Employers Expect More
Enhanced reporting can help health plans become employers’ trusted partner.
May 01, 2018
Molly Gallaher Boddy, Strategy Analyst, Market and Competitive Research
As fast and furious disruption takes over the healthcare industry, it is not only lines between traditional healthcare companies and IT companies that are blurring; the roles and responsibilities of employers and payers are also becoming similar in a variety of ways.
With large employers taking on ever-rising costs to insure their workforce—facing a five percent rise in healthcare benefit costs according to the National Business Group on Health--they are testing innovative ways of controlling employee healthcare costs. Rather than make wellness initiatives solely the responsibility of their health plans or payers, employers are themselves combining technology and personalized services to target expensive employees or expensive dependents within their population(s).
The first cost control technique involves utilizing analytics to get a better view of which employees and which conditions are driving spend. Targeting employees with the kind of conditions that may respond well to care management, as well as various other types of intervention, requires the use of advanced analytics tools that are geared specifically towards the needs of employers. Expanding the use of analytics is thus a key priority of employers because it allows them to identify not only the most expensive employee groups, but also the more difficult-to-target rising-risk employees who are at a critical stage in their healthcare journeys.
With employee activation and engagement efforts, workers with rising health risks can be prevented from moving into a high-risk, high-cost category. The identification, management, engagement and education of risking-risk populations—such as those employees with prediabetes—is crucial to create the right types of interventions. Employers hoping to better control their future healthcare expenses are increasingly harnessing the power of analytics not only to treat the sickest employees enrolled in their health plans, but to identify key areas for improvement and actionable insights across their entire enrolled population.
In addition to adopting a predictive or prescriptive analytics platform, employers with a long-term vision for controlling healthcare costs are focusing on rising-risk employees and their dependents, helping them from moving into more severe disease states by adopting self-service tools and more comprehensive wellness programs. Both types of offerings help make employees central actors in their own health; cost savings can be realized when employees are active participants in preventing disease.
The healthcare industry has also been abuzz with discussion around the concept of whole health, with thought leaders highlighting the need for employers to take seriously facets of wellness such as mental health. Consumer-centric wellness companies like Fitbit, Welltok, and higi are helping shift care to this whole person model, with the understanding that much of what keeps people healthy takes place outside of traditional clinical settings. Wearables, biometric testing available in retail spaces, scheduling apps and price transparency tools can all be leveraged by employers, as they have been by payers, to meet their employees where they are, adhering to their need for flexible approaches to wellness and their preference for using certain tools in their daily lives.
One final and innovative way employers are seeking to lower costs? A complete rethinking of traditional corporate healthcare models. As the rest of the industry consolidates and the definition of a “healthcare” company is rewritten, large employers are getting in on the disruption. The biggest employer-centric healthcare news of the year so far comes from Amazon and partners Berkshire Hathaway and JP Morgan, who announced in January that they would together create a new company—rooted in value-based principles—to bring their collective workers affordable coverage.
There are numerous other signs that employers may be dissatisfied with the health plan options currently available to them. For instance, Disney recently announced it would sidestep traditional payers and insurance plans altogether, instead entering into deals with Orlando Health and Florida Hospital to provide its employees with HMO plans. Small businesses, meanwhile, are testing out using HRAs to save money, replacing traditional group plans.
Health insurers themselves have recognized the desire of the employer market to have cost-effective or tailored plans that better meet their needs, resulting in payers like Aetna collaborating with health systems around plans aimed specifically at providing better patient satisfaction and more coordinated employee healthcare
In addition, some employers are uniting with payers, health plans and providers, creating partnerships around the shared goals of improved quality, lower cost, and better member or patient experience. When employer groups unite with those delivering healthcare and benefits, they give their workforce access to technology platforms, care managers, educational resources and greater opportunities for data sharing that ultimately improves outcomes.Finally, some large employers are test driving a model where they in fact own medical practices or staff. Apple is working to open two CA-based clinics under its AC Wellness subsidiary, where workers and their families can receive immediate care and Apple can staff the locations itself while offering a “concierge” model of care delivery.
Of course, enacting comprehensive changes to how employee healthcare is delivered will take time. And, disruptive forces such as Amazon, Berkshire Hathaway and JP Morgan are likely to come up with healthcare models that are most viable for the largest of employers, leaving smaller and even mid-sized employers in a continued hunt for ways to lower healthcare costs.
Thus, the employers most likely to succeed in quickly solving cost issues are those that effectively share responsibility with their employee---and potentially with payers, health plans and provider groups-- treating wellness as a partnership. Employers are adopting analytic platforms that help them to understand and design programs for the highest risk and rising-risk segments of their population. However, they can pass some responsibility for health on to employees themselves by deploying self-service tools and wellness programs that actively engage users by aligning with their schedules and preferences.
Steps health plans and the industry can take to better engage physicians in value-based care.
At Geneia, we know that much remains to be done if we’re going to reverse widespread physician dissatisfaction.