As the latest Mercer National Survey of Employer-Sponsored Health Plans shows, more employers are offering employees tools to make more informed healthcare decisions. Among the largest employers (those with 20,000 or more employees), 28% provided transparency tools through a specialty vendor in 2016, up from just 15% two years ago. An additional 62% say their health plan provides some type of transparency tool.
But some employers are taking consumerism a step further and actually paying employees for using these tools to select lower-cost healthcare services. As this Wall Street Journal article describes, the states of Kentucky and New Hampshire and Jackson Health System are three employers taking this approach.
Vitals, Inc., a healthcare comparison shopping tool used by the state of New Hampshire, estimates employers saved $12 million by using their tool on “shoppable” procedures (e.g., mammograms, MRIs, CT scans and blood work). More complex procedures for which people are understandably less price-sensitive, such as cancer treatments or brain surgery, aren't included. Typical savings for employees can range widely from $25-$500, often paid in checks or gift cards, according to Vitals.
Transparency tools can be a key source of cost and quality information, but these tools need to be visible and user-friendly to gain traction with employees and thus generate savings. Effective communication about the tools are essential, but you might also consider more innovative approaches like those used by the employers above to incent smart shopping behavior in your population.
Often when discussing health benefit design, cost management strategy, and compliance requirements, one aspect can get lost – the patient experience. Being a patient can be incredibly time-consuming between network provider searches, making appointments, filling prescriptions and making sure your physician(s) have the appropriate referral forms, medical records and insurance information, not to mention time spent on hold or waiting for a call back from the doctor’s office. This recent article by Vox’s Sarah Kliff outlines the frustrations she encountered – and the time she wasted – in trying to access care for an injury. She calls patients “the health care system’s free labor”. Electronic medical records and data interoperability should – someday – lighten the administrative load. But right now, in the face of a fragmented health care system, how can an employer help their employees spend less time and effort getting the care they need? One option to consider is a health advocacy program. In the best programs, employees have a dedicated health advocate who can advise employees wherever they are on the health spectrum. For serious health issues, the advocate should be trained to help the member navigate the system to get to the right providers and even take on reconciling medical bills to ensure everything has been processed appropriately, which can go a long way in not only reducing frustration for the employee, but also increases the odds that they will continue to take steps to manage their health knowing they have help along the way.
ERISA pre-empts Vermont's all-payer claims database (APCD) reporting law, the US Supreme Court has ruled. The court held the state statute imposes duties that are inconsistent with ERISA's central design of providing a uniform national scheme for plan administration without interference from multiple state laws. Vermont's law requires all health plan payers to report to state regulators an array of claims and other data about their plans. APCD laws have taken effect or are planned in at least 18 states and several other states have considered such a program. The ruling limits state databases' potential to improve health care transparency but relieves ERISA plan sponsors of complying with multiple APCD laws.
This week the Centers for Medicare and Medicaid Services (CMS) and America’s Health Insurance Plans (AHIP) announced a set of seven standard areas in which the quality of physicians should be measured, ranging from primary care to treatment of patients with cancer or AIDS. This is the first time the two organizations have collaborated on such an initiative, which will not only standardize quality measures and contribute to compensation and pay-related decisions, but will also reduce the administrative burden that many doctors currently face in terms of reporting their outcomes and other metrics of success to insurers and Medicare; in the current system, doctors often have to fill out many different, sometimes duplicative, requests for quality data from the various insurers with which they have contracts. We see this move as a great step forward for the shift to value-based care, but keep in mind, CMS said the measures will be implemented in several stages. For instance, commercial health plans will implement the core measures when contracts come up for renewal or if existing contracts allow modification of the performance measure set. CMS and partner organizations intend to add more measure sets and update the current sets over time. We encourage employers to discuss timing and possible impact with your health plan partners and transparency tool providers.
According to a new report from Pew Research Center, 64% of adults in the US own a smartphone. What they are doing with that phone just may surprise you. Almost two-thirds of adult smartphone owners have used their phone to look up information on a health condition. The younger they are, the more likely they are to use their phone for this purpose -- 77% of owners ages 18-29, compared to 39% of those age 50 and older -- which means the trend will only strengthen as the younger users age. But the internet is full of medical information that may not be credible. For the sake of your employees’ health, you may want to steer them to credible resources that will have a positive impact on the type and quality of care they receive. Just make sure that your employees can access those resources via their smartphones.
A recent analysis of four hospital rating systems – Consumer Reports, Healthgrades, Leapfrog Group and U.S. News & World Reports – found differing conclusions about which hospitals provide the best quality of care. There isn’t one hospital that was rated as a top performer by all four rating systems. In fact, some hospitals rated as top performers by one system were rated as poor performers by another. The rating systems use different methodologies that can result in consumer confusion. This analysis suggests that rather than simply provide employees with links to these rating systems, employers should also communicate the focus, limitations, and goals of each rating system.
As enrollment in consumer-directed health plans increases, there’s a lot of focus on empowering employees with price and quality information to help them choose a cost-effective provider. But new research shows employees could also use help earlier in the process, before they decide what type of care to seek. This article from The New York Times summarizes the results of a systematic review that found the majority of patients overestimate the benefits and underestimate the risks of a treatment. Correcting these perceptions could affect the treatment decisions patients make. Providing employees with access to a decision-support program that assists in determining the type and amount of treatment to receive could be a win-win for both employers and employees.
Here’s a resource you may want to pass along to your employees. The Health Care Cost Institute (HCCI), a nonprofit industry association, has launched a price transparency website to help consumers find cost information for common health conditions and services, based on data collected from four major health insurers – Aetna, Assurant Health, Humana, and UnitedHealthcare. The attractive, easy-to-use website, called Guroo, provides national, state and local cost averages for a comprehensive list of services. You can’t look up costs by provider, but you can quickly get a sense of how much the price for the same service varies by geographic location. Of course, most consumers won’t want to travel across the country – or even to a different city – to get the lowest possible price on an MRI. But if they know the local average cost, they’ll know if their provider is way out of line – and that there is likely a less expensive option nearby.
This blog post in Health Affairs is a reminder that consumerism does not come easy. For the most part, individuals are just not equipped to navigate the health care delivery system without support. Lowe's, a pioneer in health care benefit strategies, found that while financial incentives can change behavior in small ways, such as encouraging greater use of generic drugs, their early efforts with disease management programs only achieved a 10% engagement, and no return on investment, over a 5-year period. What they learned is that their people just didn’t believe that insurance companies could be 100% focused on their best interests. So now employees and their families have free access to a third-party personal health assistant to help them navigate the maze of getting care and learn to take better care of themselves. Lowes reports a 99% satisfaction rate – their employees trust their advisors and act on their advice. For Lowe’s, nirvana is a better customer experience in their stores because of happy and healthy employees.
We’ve written before that a true consumerism strategy means balancing higher employee health plan cost-sharing with tools, resources and education to help them get more for their health care dollars. This article, which quotes our own Tracy Watts, offers 12 solid money-saving suggestions for those in high-deductible plans – or in any plan with cost-sharing. What I like is that some of these suggestions could also result in getting better care, not just less costly care. For example, “Get copies of all your medical test results and records” – not only can bringing records to an appointment cut the number of tests and office visits you pay for, but if you visit a doctor with test results in hand, you may get the advice you need faster. While the list would be useful to pass along to employees, it also includes food for thought for employers. One suggestion is to consider online, telephone or video consultations. Providing employees with telemedicine services makes that much easier to do.
Following the passage of the ACA in 2010, venture capital investments in digital health doubled in just two years – and innovation is occurring ten times faster than we have ever seen in health care. In their new report, Oliver Wyman’s Tom Main and Adrian Slywotzky discuss how high tech, transparent marketplaces, and consumer power are transforming US health care. The tech entrepreneurs are redefining the rules and placing the consumer in the driver’s seat – so fasten your seatbelts! The destination is a world that keeps people well and gives them more years of productive, good life.
Health care consumerism hinges on three things: Having pricing information, comparing prices before seeking services, and actually taking price differences into account when choosing a provider. Employers can provide employees with a transparency tool and even give them incentives to use it -- but will employees select lower-cost providers as a result? That’s where the rubber meets the road in terms of cost savings. Fortunately, a new study by Castlight Health, published in JAMA, suggests they will. Castlight, which provides an online transparency tool, analyzed the medical claims of more than 500,000 employees at 18 companies between 2010 and 2013. Those who compared prices before receiving care had lower claim payments than those who didn’t: 14% less for lab tests, 13% lower for imaging, and 1% lower for doctor visits (prices don’t vary as much for doctor visits as for lab tests and imaging). Interestingly, employees chose lower-cost providers even when their own out-of-pocket costs were not affected. This bodes well for the ultimate goal of transparency -- using competition to hold down cost. The bad news? Fewer than one in three plan members in the study actually searched on prices before seeking care. That tells us that communication will be a key factor in the success of a transparency initiative.