August 20, 2024

Key Takeaways

• Employers are pursuing various delivery reforms at the same rate as last year with the exception of virtual-first solutions, which may see a slight decline in employer adoption.
• Employers cite transparency of quality data, navigation to higher quality providers and sites of care and reducing inappropriate care as the top actions to impact the quality of care.
• Employers' top concern about virtual care is how well it can be integrated into the broader health care system and programs.

The Many Paths to Driving Change in Health Care

For decades, employers have driven innovation in the ever-evolving health care system while grappling with cost and member experience challenges. Employers have supported the creation of alternative delivery models, the transition to value-based payments and the rise of virtual care as a viable form of health care delivery.

The survey asked employers to characterize their current approach to driving change in health care using four different profiles: “wait and see,” “defer to partners,” “drive delivery system change” and “won’t wait for delivery system” or a combination of the latter three. It’s clear that employers intend to stay in the driver’s seat with only 8% taking a “wait and see” approach and 7% exclusively relying on their partners for direction. The percentage of employers that see themselves as drivers of delivery system change, by relying heavily on leverage tactics like value-based payment and alternative payment models, continues to rise. (Figure 6.1). 

Employers indicated which actions they believe will impact the quality of care. The data indicate the potential employers see in different aspects of the health care experience (Figure 6.2).

The top three actions that employers believe will impact quality of care are: 1) improved transparency of quality; 2) navigation to higher quality providers and sites-of-care; and 3) reducing inappropriate and unnecessary care. This year’s findings are an illustration of employers’ continued pursuit of quality, as these actions require complex strategies and a long-term commitment.

Virtual Health’s Key to Success: Integration

A core element of employers’ strategy to expand access to health care has been virtual health, which has become a critical underpinning of a majority of employer offerings and a service offered by many community-based providers. At the height of the pandemic, the vast majority of employers saw virtual care as having a significant impact on care delivery (85% in 2021); over the past few years, however, that percentage has declined (66% in 2024), highlighting some of the challenges inherent in virtual care, as discussed below (Figure 6.3).

As virtual health has become more prevalent within the delivery system, employers have called out several continued challenges. Employers’ primary concerns about virtual health continue to center on its inability to integrate within the health care system. Furthermore, virtual solutions offered by a variety of vendors drive fragmentation due to lack of integration and coordination among those vendors and programs, and across virtual care and care in community. Seventy percent of employers expressed concern about the siloed care experience due to lack of coordination between virtual health and community-based providers (Figure 6.4). When comparing employer views in 2024 to those expressed just 1 year ago, it is evident that the concern about the lack of integration between vendors is growing. Relatively fewer employers are concerned about the quality of care and unnecessary use of services provided virtually. 

Employer Actions to Influence Change

Improving the quality of health care delivered to employees and their dependents requires using a variety of tactics. Figure 6.5 shows how many employers are leveraging five different delivery reform methods. As in previous years, use of centers of excellence (COEs) is the most common approach. High-performance networks (HPNs) are used by nearly half of the employers surveyed, while value-based primary care and accountable care organizations are leveraged by about a third of respondents. All four approaches didn’t experience much change from last year. However, fewer employers will offer a virtual-first solutions model in 2025. By definition, virtual-first is when virtual care is heavily incentivized or required before an employee can see a provider in-person. While 26% will still offer this in 2025, the downward trend could indicate employers’ move away from virtual-first offerings. 

Primary care is another area of the health care experience that employers are continuing to use to innovate and drive change. In this area, employers are focused on improving employees’ access to and experience with primary care. Overall, 63% of employers will leverage at least one of the advanced strategies listed in Figure 6.6. There is substantial anticipated growth in virtual primary care and direct primary care in select markets.

“

Primary care is a big priority for us and will likely be the target of any future solutions we offer. It's important that our partners are a good cultural fit for Lennar, can adapt their approaches to the needs of our Associates and ascribe to an innovation mindset.”

- Marcia Buie, Lennar Homes

As mentioned previously, the use of COEs is the leading delivery reform strategy, aimed at connecting patients with higher quality providers. The scope of COE offerings also corresponds to the high-cost conditions mentioned in Part 2. COEs will increase across the board between 2025 and 2027. Specifically, cancer, weight management and musculoskeletal COEs will experience the largest increases, likely fueled by ongoing concerns about the high costs of treating those conditions (Figure 6.7). For weight management specifically, COEs can play a role in the appropriate utilization of GLP-1s.

As seen last year, about half of surveyed employers have at least one on-site health/well-being clinic. This represents a steady approach to continued support of existing clinics and does not indicate significant anticipated growth in future years.

Employers with clinics are also settling in on what services are offered to employees. The most common services in 2025 will be vaccinations (96%); well-being programs (88%); and acute care (83%). In 2025, more employers will offer mental health services directly on-site than in 2023 – a 19-percentage point increase in just 2 years. More employers are looking to integrate their on-site clinic and fitness center in 2025 as well (Figure 6.9).

More Topics

Resource Plan Design & Administration Virtual Solutions Value-Based Care