Businesses that want to boost their bottom line in 2018 need look no further than their employee health and benefits Strategy. More than 50 scientific, peer-reviewed studies underscore the correlation between investing in employer health and improved financial performance. Most recently, researchers found that companies with award-winning wellness programs also have award-winning stock prices, outperforming the Standard and Poors (S&P) Index by 7-16% annually. Even if employee health initiatives did not directly cause a company’s stock to rise, emphasizing these initiatives is associated with high-performing companies.
Just because your company offers comprehensive health initiatives, however, does not mean employees will immediately take advantage of these offerings. Many employees have been conditioned to only use health insurance when they need it, waiting until they are showing symptoms of sickness before seeking care. Moving to a preventative care model requires a change in behavior and thinking. Employers must think strategically about their offerings and consider the most effective ways to encourage participation in evidence-based, preventive care programs.
Despite uncertainty over Congressional healthcare reform, trends like high-value care, direct payment primary care and value-based insurance design could help businesses hold the line on health care costs or even lower the long-term cost of care while also empowering their employees to proactively take control of their health.
These are three employer health trends to watch in 2018:
1. High-value care.
What it is:
High Value Care (HVC) is an approach designed to improve health outcomes by educating patients about the importance of proactively seeking appropriate care and making this care more affordable and accessible. A 2016 study published in JAMA found that simply reducing spending on low-value medical services and unnecessary medical procedures could save employers millions. Low-value medical services are those that offer limited benefit to the patient but come at great expense to insurance companies and employers. In contrast, high-value care services often cost far less than some low value care services, but offer significant long-term health benefits.
High value care aims to reduce emergency department overuse, antibiotic overuse, vaccine under-use and unnecessary hospital re-admission. The result: an estimated $500 billion in savings, according to the Network for Excellence in Health Innovation (NEHI).
What employers can do:
Employers have an opportunity to customize their benefit design to encourage benefits proven to make a difference and to discourage the opposite. Examples of high-value care include preventive screenings, vaccinations, education about medication adherence and proper use, and chronic disease treatment. High value care initiatives can be rolled out in conjunction with workplace wellness programs that offer free or reduce care for HVC preventive services.
2. Direct payment primary care
What it is:
Direct primary care (DPC) is an emerging model of primary care in which medical practices offer primary care services for a flat, recurring fee that is billed monthly, quarterly or annually. Patients can visit their primary care provider as many times as necessary for care and receive vaccinations and other preventive services for free or at a reduced cost. Most individuals with DPC opt for a low-cost, high-deductible insurance policy that would cover any emergency or specialist care not provided through their primary care provider. Patients benefit by being able to see their doctor at any time. Doctors are able to rapidly address evolving health concerns, reducing the number of sick days an employee might have to take and increasing on-the-job productivity. Many DPC practices offer direct phone or email access so patients can get immediate medical advice while avoiding unnecessary appointments.
What employers can do:
While DPC is still an emerging model, both physicians and patients who have opted for this care model report higher rates of satisfaction and better outcomes for chronic disease prevention and management. Employer who wish to promote direct primary care could offer their employees a low-cost, high-deductible health insurance policy in addition to contributing to an HSA (healthcare savings account) to offset the recurring DPC fee. This model may help reduce long-term health care costs while improving care outcomes for employees. DPC is still in the early stages of development, so this is one trend employers should watch closely in 2018.
3. Value-based insurance design
What it is:
Value-based insurance design (VBID) is a new approach to structuring health care policies that incentivizes employees to utilize high-value services with the greatest potential to positively impact their health. Currently, employees pay the same for all medical services under a given health insurance plan, whether or not these services are high-value or low-value. As out-of-pocket costs continue to rise, employees are then less likely to utilize high-value services that are essential to improving health outcomes. The result: employers end up shouldering the cost of higher insurance premiums since care is sought after the fact (an employee is already sick or a chronic condition is not managed) rather than before the problem exists.
VBID aims to change this by aligning out-of-pocket costs, like co-payments, with the value of services. In essence, this means that high-value services with the greatest potential to impact a patient’s health become more affordable while low-value services become more expensive. This principle can also be applied to prescription drugs. Under the VBID model, the level of employee cost-sharing for higher-priced medications would be aligned with the clinical value. This approach is especially beneficial for employees who are struggling to control a chronic condition like diabetes or heart disease and find that lower-cost alternative medications are unable to adequately control their health condition. VBID recognizes that the same prescription drug could be of high value to one patient and a lower value to another and aligns costs accordingly to these clinical nuances.
What employers can do:
Like direct payment primary care, value-based insurance design is still in its nascent stages. However, employers should consider ways to integrate VBID into their approach to health care. VBID reduces cost sharing and encourage adherence to high-value services and providers. Employees benefit with better access to higher quality, affordable care and employers benefit with reduced wasteful spending, more efficient expenditures and a healthier workforce.
Next Steps for 2018
High value care, direct patient primary care, and value-based insurance design are three innovative approaches to the decades-old problem: how can we control rising health care costs and improve patient-care outcomes? Watch this space in 2018 for more in-depth discuss of these employer health trends.
Scott Foster is President of Wellco. Scott and Wellco have provided award-winning systems to measurably improve health conditions and costs. Wellco specializes in engagement, analytics, integration and high-value care. For more information visit, www.Wellcocorp.com
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