March 26, 2020
The Employers’ Summit on Health Care Costs and Solutions is an annual, employer-only meeting hosted by Business Group on Health in Washington, DC. The event focused on key trends in health care and policy, as well as actionable steps human resources professionals can take to improve health outcomes and reduce health care costs. Some 93 benefit leaders from 74 companies came together early in the health care planning cycle to reflect on 2019 initiatives, discuss strategy for 2020 and plan for 2021 and beyond (Figure 1). The following is a brief look at some of the most compelling insights from this year’s summit.
What Keeps You Up at Night? Costs, Engagement, Affordability and Quality
High health care costs, employee engagement and specialty pharmaceutical trend remain top concerns for employers (see Fig. 1), but new concerns popped up near the top of the list. The quality of the benefits experience and health care system is increasingly on the minds of employers. Additionally, a nuance on the concern regarding overall costs was highlighted by several members, who specifically focused on the affordability of plan members’ out-of-pocket expenses. (See Fig. 2 for data on employers adding additional plan design choices.)
Lisa Woods on “Focusing On Quality Health Care Over Quantity”
For what we’re all paying for health care in the U.S., we should expect it to be top quality, but it’s often not the case. Lisa Woods shared Walmart’s evolution in driving quality in their benefit plan, as well as tips for other employers to keep in mind while looking to do the same.
Lisa’s Tips for Identifying Areas to Improve Quality
- 1 | Focus on the care you actually need. Just because something is done well, doesn’t mean it should have been done in the first place. An unnecessary back surgery done on someone who would have gotten better with more conservative approaches can’t be considered high quality. This won’t necessarily show up in your data unless you look for it.
- 2 | Look upstream. Walmart partnered with a technology company to identify high quality radiologists. We steered members to them after hearing from centers of excellence partners that many of the local diagnoses were changing due to poor readings and imaging machines. Don’t assume that “commodity” services are just that.
- 3 | Continuously drive for quality improvements. Several research institutions estimate that about one third of spending on health care in the U.S. is wasted, in large part driven by poor quality and inappropriately delivered services. Rather than simply celebrating a successful center of excellence (COE) roll out for musculoskeletal conditions several years ago, Walmart has continued to add new conditions to its COE program every year.
- 4 | Infuse the quality discussion into every benefit program and communication. Walmart has been able to drive employee interest in the quality of their health care by making it a standard part of the discussion of their benefits programs. Employees are now asking about options, and about the quality of care they can receive.
The Pharmaceutical Supply Chain Needs an Rx
Across multiple pharmacy sessions, employers expressed frustration about the lack of transparency in the pharmacy supply chain. There is some hope that health plan/pharmacy benefit manager (PBM) integration will lead to improved visibility to total cost of care and future opportunities to disrupt the status quo.
Employer panelists identified 10 changes they’d like to see in the pharmacy supply chain to control costs and improve adherence to evidence-based medicines:
- 1 | A limit to patent duration;
- 2 | Price regulation, including the capping of average-wholesale inflation;
- 3 | The ability to limit formularies to only drugs that are relevant to a specific employer population;
- 4 | Refunds by pharmaceutical manufacturers to employers when a drug is ineffective;
- 5 | More price transparency, including real-time pricing visibility for patients in the doctor’s office;
- 6 | The ability to offer cash payments for pharmaceuticals that count toward deductibles;
- 7 | Best-in-class clinical review that can influence aggressive utilization management strategies;
- 8 | More active and effective leveraging of pharmacists in the supply chain;
- 9 | PBMs taking on more fiduciary responsibility for pharmaceutical plan spending; and
- 10 | A ban on direct-to-consumer advertisements for pharmaceuticals.
Speaking the Language of Finance
Effective communication between finance and HR teams at all levels is often seen as essential in advancing an innovative health and well-being benefits strategy. C-Suite leaders from Marriott International and Cigna shared their top tips for creating effective teams across HR and finance.
- 1 | Move away from transactional relationships between finance, HR and employees. Creating an effective culture of supporting health in your corporate office and across your company will ultimately succeed based on relationships rather than short- term incentives.
- 2 | Embed finance employees in HR and vice versa.
- 3 | HR will benefit from learning to speak the “business language” rather than “the language of finance.” A focus on short-term costs doesn’t translate well at the C-Suite level, as executives are making decisions based on multifaceted business, long-term realities, including how they can build an effective workforce.
What Employers Should Look for to Optimize the Primary Care Experience
Primary care accounts for only about 5% of health care expenditures, but it influences up to 90% of other spending through referrals, prescribing and prevention. Increasingly, evidence shows that advanced primary care models in value-based arrangements are reducing costs and improving the primary care experience for their patients. For example, an analysis of Medicare accountable care organization (ACO) performance in 2018 found that physician-led ACOs generated 7-times more savings than hospital-led ACOs. Similarly, direct primary care models are removing fee-for-service (FFS) incentives completely as a way to drive delivery reforms that help people stay healthy and out of the hospital.
Here’s what expert presenters say are the top five traits employers should look for in a partner:
- 1 | Willingness to contract for several years. Population health improvement takes time. Therefore, a multi-year contract is necessary to build a lasting, effective partnership among employers, health plans, providers, and most importantly, patients.
- 2 | Past success with value-based care. One of the top predictors of whether a health system or practice is able to succeed in value-based arrangements is whether the entity has been successful with them previously. Not rocket science, but track record matters.
- 3 | Purpose-driven providers. Provider groups and health plan programs that are specifically built to succeed in value-based arrangements that accept risk and move away from FFS are more likely to succeed than those who still make most of their revenue by driving utilization.
- 4 | Integration of behavioral health. Population health improvement isn’t possible without addressing the mental health of your population.
- 5 | Smart referrals to quality specialists. Primary care groups can best impact total health care spending by sending patients to high-quality, efficient specialists. They need to have the quality and cost data in their workflows to be able to do this in the course of patient care.
Back to Basics in Mental Health
When it comes to mental health, don’t forget the basics. There are several innovative technologies and creative rebranding strategies for employee assistance programs (EAP), but straightforward strategies, such as bringing mental health professionals on-site, paying for behavioral health delivered in the primary care office, increasing EAP visit limits and sending postcards home to drive utilization are working for many employers.
Terminology matters, and employers need to make sure their branding isn’t unintentionally stigmatizing. As employer presenter Linda Brady of The Boeing Company noted about EAP rebranding, “If we can’t talk about mental health, how can we expect our employees to?” To learn more about best practices for mental health and ways to break down stigma, check out the Business Group’s Virtual Summit presentation on stigma research.
The 2020 Employers’ Summit on Health Care Cost and Solutions brought together nearly 100 benefits leaders to dive into a number of topics related to improving employee health, getting employees engaged in their health care and reducing costs. It is the Business Group’s largest employers-only meeting for attendees to benchmark, share their success stories and open up about challenges they face in a vendor-free environment.
There are many ways to get involved with Business Group on Health throughout the year. We hope to see you at the summit again in January 2021.