Highlights of Employer Leadership

• Virtual care and digital health: Employers were among the first to deploy technology-enabled solutions such as virtual care, long before the onset of the pandemic. While virtual care was slow to gain traction before the pandemic, it proved to be invaluable during that period, allowing almost instant access to health care in the midst of care delivery system closures and slowdowns. Employers have also taken the lead in leveraging digital health platforms/apps that provide management of chronic conditions like diabetes and musculoskeletal issues, as well as services for mental health, to address shortcomings in the traditional health care ecosystem. But employers also recognized when it was time to step back from virtual care. As the virtual marketplace exploded with many unproven market entrants, employers challenged the health ecosystem, addressing issues such as care quality, fragmentation and duplication--problems accelerated by stand-alone digital health solutions. At the same time, employers sought more precise and actionable tools to measure the impact of various interventions and approaches.

• Improving value in health care: While employers have always focused on cost management and affordability, they have also pushed the market on quality, insisting that partners focus on improving patient outcomes, especially while managing chronic conditions. Providing access to cell and gene therapies and new treatments like GLP-1s as well as treatments at Centers of Excellence (COEs), are much more prevalent in the employer market than anywhere else in the health ecosystem. Partner accountability and the strategic approach to innovation, transparency, quality and the well-being of the workforce set the employer market apart from others, including government-sponsored programs.

  Some employers are exploring value-based care arrangements and alternative payment models with health care providers. This change involves shifting from fee-for-service models to payment structures that prioritize quality outcomes and cost-effectiveness, promoting better overall value in health care delivery. While a growing cohort of employers have taken the lead in the promotion of value, much more needs to be done. More employers need to understand and promote value-based payment models and contracting arrangements that promote high-quality, cost-effective care. Given that the preponderance of employers do not have the resources to directly contract with providers, they must push health plans – and by extension, health systems and provider groups – to move faster toward a system that rewards value over utilization.

• Addressing a lack of transparency and value in pharmacy: Employers have accelerated efforts to secure lower pricing and greater transparency for prescription drugs, one of the top drivers of health care costs. A number of practices utilized by the pharmaceutical supply chain, including opaque pricing mechanisms, patent extensions and global R&D costs being shouldered predominantly by the U.S. market, has led to continued increases in prescription drug pricing. While employers have historically used tactics like mail-order pharmacy, emphasis on generic drugs, formulary management and copayment variations to drive efficient utilization, these efforts are no longer effective in addressing prescription drug affordability issues. As employers have sought alternative approaches including biosimilars and emerging pharmacy benefit manager (PBM) models, they have run into market resistance, most notably in the form of a lack of transparency into true underlying costs and an overreliance on a rebate-driven pricing structure.

  In an effort to move the market forward, Business Group on Health convened a multi-stakeholder group of employers and industry leaders to develop 70 policy and market-based recommendations for reform of the pharmaceutical supply chain. Employers have an opportunity to take a visible leadership role in this area by, for example, recommending greater consideration of alternative pricing models (including rebate-free approaches) and insisting on greater adoption of biosimilars. However, employers cannot solve the problem of rising drug costs alone. Employers need their consulting partners, PBMs, health plans and pharmaceutical manufacturers to all embrace a system that defines, promotes and measures cost-effective, high-value pharmacy therapies with full price transparency.

• Holistic well-being: The impact of employer-driven benefit programs goes well beyond health insurance. Employers remain committed to delivering on employee well-being to drive better employee health experiences and outcomes, attract and retain talent, adapt to changing societal norms and address the rising costs of health care, all while staying aligned with changing workforce needs. Employers around the world have led the movement to think beyond simple “wellness”; mental health, physical health and financial well-being are now well-established components of employers’ well-being strategies. Further, employers are continuing to innovate, with a focus on social connectedness, community and job satisfaction as well. The vast majority of employers prioritize access to mental health services and provide programs, services and benefits for mental health and substance use disorders. Employers continue to add financial well-being support, such as financial planning, debt management and budgeting tools, with emergency savings programs emerging as a top area of interest.

  The work in this area is not yet complete. Today, multinational employers do not have a wide array of vendor partners from which to choose when adopting globally consistent mental health and financial well-being strategies. Further, as well-being programs have increasingly looked to leverage digital platforms, employers are looking for better integration among solutions, with an increased level of data sharing to enable impactful measurement of outcomes.

• On-site and near-site services: Over time, larger employers have implemented on-site and near-site health clinics to provide employees with convenient access to primary care services. On-site clinics can offer preventive care, vaccinations and basic medical services, reducing the need for off-site visits. This approach helps address health concerns proactively while benefiting employees and reducing health care costs. Ultimately, these gains translate into better health outcomes for workforces. As with other aspects of the increasingly complex health care ecosystem, the role of on-site services is evolving. Employers are pushing for improved integration between on-site solutions, virtual care alternatives and traditional community-based health care delivery. Health plans, navigation solution providers, data analytics firms and providers all must play a key role in supporting employer efforts to drive a more integrated, efficient and cost-effective experience for patients.

• Leave and time away: Over time, employers have transitioned from viewing leave as a matter of “disability insurance” to overwhelmingly viewing their leave strategy as integral to or a consideration in their overall workforce strategy. Seeing the link between time away and employee health and well-being, employers have continued to refine their approach to parental leave and caregiver leave; many employers are also adding leave for bereavement and pregnancy loss. However, as additional categories of leave emerge, compounded by the proliferation of state and regional leave requirements, employers face pressure to improve the leave administration experience for employees, an area of heightened interest. Employers rely on vendor partners to create processes and participant interfaces that work effectively across a multitude of regulatory dimensions in the U.S. and around the world.

• Changing needs of a diverse workforce: Traditional employer benefits programs have rapidly evolved to meet the needs of an expansive workforce. Today’s benefits programs include family-building benefits and support for diverse family structures, programs targeted to LGBTQ team members, transgender-inclusive health care, care for women in their reproductive years and beyond. Further, employers are working to address social determinants of health (SDOH), the circumstances in which people are born and live, including how SDOH parameters impact physical and mental health, the ability to be productive at work and overall quality of life.

• An expanded role in the health and well-being of the workforce outside the U.S.: While much of the discussion of employer activity has focused on the incredibly challenging, often imperfect U.S. market, employers have spent the past two decades with a growing responsibility for the health and well-being of employees (and to a greater and greater extent, extended families) outside the U.S. Employers have expanded from “ex-patriate coverage plans” for a select few employees to providing medical coverage that addresses inherent weaknesses in national health systems (lack of innovation, limited coverage, access issues, to name a few). Employers have pushed the market to expand offerings that span countries and regions, including holistic well-being programs. More recently, employers have advanced their desire for globally consistent benefits by leveraging captive insurance and similar mechanisms to create markets for services previously unavailable.