Rising healthcare costs are increasing the financial burden on employer groups, especially small employer groups who provide health benefit coverage to their employees. According to data released by Peterson-Kaiser Health System Tracker, health plan cost sharing and deductible spending have outpaced employee wage growth in the past ten years. Employees’ total financial responsibility increased by 54 percent from 2006 to 2016 while wages only increased by 29 percent during the same amount of time. As more and more health plans shift the cost of healthcare services to their beneficiaries, employers are looking at innovative ways to reduce the financial burden of their employees.
Frustrated with the pace at which the healthcare industry is driving change, some employers are taking a more proactive role and driving changes in the healthcare delivery system. They gear these changes towards innovative ways of healthcare delivery that emphasize on the components of value-based care.
ACOs and HPNs
Employers are contracting directly with Accountable Care Organizations (ACOs) or high-performance networks (HPNs) when these organizations offer the highest quality and/or most cost-effective providers. Under many high performance networks such as ACOs or narrow network plans, employers typically leverage partnerships among providers, facilities, or within health systems to deliver care and services to eligible participants in exchange for lower premiums. The Large Employers' 2019 Health Care Strategy and Plan Design Survey found more than 35 percent of respondents implementing alternative payment and delivery models such as accountable care organizations and high performance networks either directly or through their health plan.
Centers of Excellence
Employers have steadily increased their use of centers for excellence (CoEs) to coordinate care across the continuum and improve quality. These bundled payment carve-outs or Centers of Excellence (CoE) are initiatives to contract with providers that reward quality. At these CoEs, covered employees are gaining greater access to high-quality and high-value hip and knee replacements, spine surgeries and a wide range of other outpatient musculoskeletal procedures. Walmart is one major employer with a CoE that has no out-of-pocket costs while covering all travel-related costs for its covered employees. Walmart is also offering a CoE for other employers in need of spinal and joint replacement surgery. Employer CoE use is expected to grow from 79 percent of employers in 2016 to 88 percent in 2019.
Virtual Care Delivery
Employers believe that virtual care and telemedicine will play a significant role in healthcare delivery. Nearly 60 percent of employers offer some kind of virtual care and are finding that costs per visit are often 60 to 70 percent less than in person visits. Virtual care often provides a lower cost access point that is more convenient than and as effective as high-cost urgent care centers or emergency rooms. Shifting care from high- to low-cost access point has produced significant savings for employers and their employees. Virtual care has branched out well beyond physician consultations to include digital coaching, condition management, remote monitoring, physical therapy and cognitive behavioral therapy.
Resources for Addressing Opioid Abuse and Mental Health
The opioid epidemic has affected more than a million adults in the U.S. resulting in over $600 billion in medical costs and lost productivity. The impact of opioid abuse to employers’ health care costs and productivity is significant with abusers costing nearly twice as much in medical expenses as non-abusers and missing nearly three times as much work as their peers. Majority of employers are extremely concerned over the impact of prescription opioid abuse on the workforce and are strategizing with partners to change prescribing patterns and increasing access to alternative therapies.
Employers are conducting campaigns to reduce the stigma surrounding mental health conditions and treatment. Employers are providing self-directed online resources, group coaching, holistic wellness programs and on-site mental health care centers. These initiatives are showing encouraging results –lower stress levels, improvement in anxiety levels, reduced absenteeism and improved productivity.
If you are an insurer, or work with one, you’ll want to find out more about promoting value-based, patient-centric care while keeping costs down. Our Omni-Health Data solution works to enhance outcomes and improve member management. Read about it here.