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Benefits Strategy

Holding Vendors Accountable for Results and Assessing the Impact of Program Interventions

As health care trends reach new highs worldwide, employers are increasingly looking for their partners to deliver measurable results. Specific actions may be needed to increase vendor accountability for cost, quality and outcomes and enhance the collaboration among employers and their partners.

March 18, 2025

Introduction

Many employers are not receiving what they need from their vendors to evaluate the true effectiveness of their programs. Roadblocks such as lack of data integration across the ecosystem, low visibility into total costs and insufficient engagement metrics are examples of recurring shortcomings in the data vendors do provide. Adding to the challenges is the inconsistency of clinical and cost data available, vendor by vendor and country by country.

Now is the time for vendors to work with employers in collaborative and meaningful ways to address these challenges. Escalating costs show no sign of slowing. Employers predict 2025 U.S. health care costs to be 7.8% higher than in 2024, with double-digit increases reported around the world.1,2 These overwhelming cost increases are set against the backdrop of growing global frustration with health care.3 Seventy percent of Americans feel the health care system has failed them.4 Many vendors have been contracted to administer health programs and improve the treatment of specific conditions, yet the impact of these programs is not always clear. As overall cost, outcomes and experience are all worsening, employers seek greater transparency, are placing their programs under increased performance scrutiny and will be more discerning of vendor partners across all categories going forward.

The Business Group’s survey data indicates a clear market directive from employers: They are looking for greater value from all partners – health plans, PBMs, point solutions, administrators, consultants – and they are willing to look elsewhere to find it. In fact, 22% are saying that they are looking to change health and well-being vendors in 2025. Furthermore, 38% are assessing whether to put out RFPs or are already doing so. PBMs appear to be a particular area of focus for employers, with almost a third planning an assessment or RFP of their PBM in 2025.

A Call to Action for Employers

Employers looking to reduce health care costs should start with assessing how they hold their vendors accountable for improvements in health outcomes, member experience, cost and integration across programs. Employers should reconsider their relationships with vendors who provide duplicative services and those who are unable to produce meaningful outcome data on the impact of their offerings on employee health.

When U.S.-based employers were asked about the most important aspects of vendor partnerships, results show that claims/utilization data and data measurement and transparency are critical in assessing health plan and PBM partnerships, with over 96% rating each as “Very Important” or “Important” (Figure 1).5 Vendors who do not answer the call for greater transparency and accountability risk getting left behind.

Figure 1: Importance of Different Aspects of Partnerships, 2024 
Figure 1: Importance of Different Aspects of Partnerships, 2024

Strategies for Demonstrating the Value of Health and Well-being Programs and Assessing Their Effectiveness

Vendors have an opportunity to partner with employers early on to collaborate on relevant and credible assessment methodologies that incorporate appropriate outcomes data to assess whether programs are meeting their established objectives. While many vendors put forward reporting and outcomes data demonstrating compelling results and value, employers are increasingly skeptical of these self-reported outcomes. For that reason, employers sometimes seek independent validation from other partners with visibility to broader population data, including consultants and data warehouses, who themselves must prove their value.

1. Demand better data and transparency

Call on vendors to improve the usability of their data. Employers expect access to the information necessary to perform independent result validations. However, vendor systems have not caught up to employer’s demands, so even if the data exists, it may require the employer or a third party to perform significant analytics before using it. That may impede employers from being able to regularly conduct these reviews. Vendors have the resources and the infrastructure to start creating more user-friendly outcomes reports with impactful data points that employers can rely on, allowing vendors to credibly show their value on a regular basis.

Additionally, vendors have more direct touchpoints with participants, which enables them to collect feedback and outcomes data, as well as make data-informed program strategy adjustments. Whereas employers have a responsibility to shield themselves from their employees’ identifiable health data, vendors have a responsibility to not only collect data to perform services and deliver care, but also to analyze and act on it to make the programs better and more impactful.

Data Also Empowers Participants

Better data is not just for measuring outcomes; it can also be shared with health plan participants. For far too long, individuals have been faced with making confusing health care and benefit decisions without data to help them. Transparent price and quality information is foundational for consumers in almost any other industry, but it is severely lagging in health care. This is especially true in the U.S., where costs for services range widely. Employers must challenge partners to use available data to help participants find quality care while also taking cost into account.

While there may be an appetite to replicate successful validation and vendor accountability strategies globally, countries and regions have varying considerations, including availability of data, privacy laws, internal accountability and maintaining consistent and operational data feeds. When designing a consistent global strategy, employers should prepare to take unique and specific actions in each region to meet their data goals.


2. Establish measurable goals early

Behind every strategy is a desired outcome. Often, the initial objectives are general, such as “improve the employee’s experience,” “reduce chronic disease prevalence” or “lower costs.” While overarching objectives are important, employers should consider establishing specific, measurable goals as early as possible, even at the beginning of the RFP process. Rather than set goals based on what vendors promote, employers have an opportunity to approach the market seeking a specific solution for a specific problem. During the implementation process, both vendor and employer can align on meaningful and measurable goals, such as “active and sustained engagement of 25% of members identified as high risk” or “increase utilization of high-quality providers by 10%.” Setting program-specific goals early can also help employers maintain a comprehensive benefits ecosystem that addresses employees’ diverse health needs.

Establishing goals early is effective not only in choosing vendors but also in measuring their effectiveness over time. This original goal-setting exercise should include a summary of how these goals are linked to key performance metrics, such as ROI and engagement, as well as the frequency and funding of performance reviews. Up to a reasonable amount, vendors should bear the costs of these assessments. Aligning on these items and conducting regular reviews reinforce program goals, foster a transparent relationship and provide more frequent opportunities to identify areas for improvement and collaboration on solutions. If leveraging a third party, any performance assessment will still require the vendor’s partnership, especially regarding data sharing.

Not All Metrics Are Created Equal

As mentioned, many vendors do provide some performance measures in their regular reporting. Several of the commonly used metrics in these reports have limitations to be mindful of:

  • ROI: Frequently, ROI calculations use estimated savings due to an intervention that redirected care. It is difficult, however, to demonstrate savings without an original documented treatment path. A side-by-side cohort analysis and total cost-of-care savings generated over time may be better ways for well-established programs and solutions to document savings.
  • Engagement: Program participation numbers are often easily captured and an important first step. Engagement statistics can be most indicative of a program’s effectiveness if they offer details indicating what part of the solution members are engaging with, if they are returning at recommended intervals and if the engagement is appropriate and coming from those with the most opportunity for improvement in health. It is critical that employers understand the definition of “engagement” being used and then assess whether that definition is meaningful.
  • Member reporting: A member’s perspective of their experience and whether their health goals were achieved is a significant but subjective metric. It should not be used for assessment of evidence-based care practices and cost efficiencies. However, consistent and clear self-reported member experience and outcomes may provide valuable insights on effectiveness to both the program administrator and the employer.

Other critical metrics that offer additional insights include the following:

  • Rate of referrals to high-performing quality providers, other employer-sponsored solutions and community resources;
  • Engagement by risk score;
  • Longitudinal results from members 1-2 years post-intervention; and
  • Total cost of care, including claims costs over time as well as administrative fees retained by the vendor.

It’s also possible for employers to collect high-level outcomes data by asking their employees through a simple survey if they are doing better as a result of their engagement with a program. Employers can use those results to track success and determine the need for additional employee support.


3. Incentivize quality improvement through outcome-based payment structures

Outcome-based payment structures can factor in both upside risk (bonuses are paid upon goal being met) and downside risk (fees are returned if goals are not met). Performance guarantees are commonly included in vendor contracts. However, purely operational metrics proposed by the vendor might not align with the performance expectations of the employer. Employers should conduct a thorough review of the guarantees used and consider if contractual performance guarantees can be revised to increase vendor accountability for the impact of the program on health and well-being.

Outcome-based payments may require more involvement upfront to determine the right goals, how performance against those goals is measured, over what time period and the right amount of fees at risk. But once in place, they provide a more routine and consistent method of vendor oversight.


4. To reduce fragmentation, streamline and insist on collaboration

For employers to achieve maximum effectiveness from their programs, each vendor partner must lean into viewing themselves as part of the employer’s ecosystem. Employers should challenge vendors to fit within their organizational goals and collaborate with others within their vendor ecosystem. This can be done by focusing on vendors' effectiveness in providing more holistic, longitudinal services and in referring members to other solutions offered by the employer.

To take this collaboration further, employers can request that detailed data is shared among partners on an ongoing basis or centralized with a single partner, such as a data warehouse. Some larger employers have taken a firmer stance here, making this a “deal breaker” and only working with vendors willing to openly share data.


Conclusion

In this high-cost, high-scrutiny environment, vendors and employers have an opportunity to proactively align on the best ways to demonstrate the impact of their programs and showcase their value. As vendor relationships evolve and horizontal and vertical alliances are formed, the assessment of impact and accountability for results may be more complex, but better outcomes achieved through effective collaboration can and should be easier to detect.

Related Resources

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TABLE OF CONTENTS

  1. Introduction
  2. Strategies for Demonstrating the Value of Health and Well-being Programs and Assessing Their Effectiveness
  3. Conclusion