As employers anticipate that their employee health insurance costs will rise 5.5% for the 2018 policy year, they are also planning to step up their cost management efforts in new areas, according to a new study.
And despite the maelstrom in Washington over how to deal with the Affordable Care Act, 92% of employers surveyed said they are “very confident” their organization will continue to sponsor health benefits in five years, according to the “Willis Towers Watson 2017 Health Care Employer Survey.”
Employers will try to contain costs by exploring new strategies like emerging health care delivery systems, and arrangements that help employees better navigate the health care system and improve health engagement.
Over the past few years, employers have been shifting more of the cost burden to employees and now they are looking for new ways to address future premium increases, according to the study.
The areas where surveyed employers feel they can make the most progress include:
Better and less costly health delivery models:
- Telemedicine for office visits – 78% of employers currently use these consultations, with another 16% planning to or considering doing so by 2019.
- Centers of excellence – The growing need for disease-based medical management of chronic-type conditions has prompted hospitals and health plans to offer centers of excellence. These programs have been developed in a number of specialty fields, including diabetes, neurosciences, spine, craniofacial surgery, musculoskeletal and orthopedics, cardiology and interventional pain. This model likely will grow in importance and may be as close as possible to a perfect model for care in this changing environment, according to <i>Hospital and Health Networks Magazine</i>.
- High-performance networks – Also known as “narrow networks,” these are exclusive groups of high-value health care providers and health professional organizations recruited to serve a defined patient population. These have grown in popularity because they promote higher-quality health care services while delivering better value.
Addressing pharmacy costs and utilization by:
- Evaluating pharmacy benefit contract terms.
- Adopting new coverage or utilization restrictions for specialty drugs.
- Addressing specialty drug costs and utilization performance through medical benefits – 44% of employers currently do this, with another 38% planning to or considering doing so by 2019.
Improving employee engagement by:
- Including more voluntary benefits – 66% of employers do this.
- Providing decision-support tools during enrollment – 55% of employers currently offer such tools, with another 26% considering doing so for 2019.
- Encouraging the use of mobile apps for managing health issues – 19% of employers currently provide this to their employees, with another 28% planning to or considering doing so by 2019.
- Promoting wearable devices for tracking physical activity – 26% of employers currently promote these to their employees, with another 18% planning to or considering doing so by 2019.
This blog is not intended to provide legal advice, but rather perspective on recent regulatory issues, trends and standards affecting health insurance, voluntary benefits, 401(k) plans and other employee benefits. Please consult your broker or legal counsel for further information on the topics covered herein.
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