Navigating healthcare is a challenge. The market has responded by bringing together an array of tools to guide consumers. This is a fictionalized account of one patient’s journey.
So I wiped out on the bike today in the strangest possible way. I was training for this year’s NYC Five Boro Bike Tour when I got distracted by a man on a unicycle juggling bagels and lost control. I can’t believe it! Only in New York. My bike is okay but I’m out of commission. I hopped over to the sidewalk and called an Uber back home. My right knee looks pointed inwards and the Internet says that could mean a torn ACL. I’m going to ice my knee, take some Advil, and hope I’m wrong.
It’s been three days now and I still can’t use my knee in any way. So I bit the bullet and took an Uber to the ER. I’m getting sick of sitting around in my apartment. Now I’m lying here in bed waiting for the nurse to come back and fit me with a brace. The doctor told me I was right about the torn ACL and that I should go home and schedule surgery for two weeks from now. I’m so scared about the idea of surgery and I don’t even know how I’ll be able to pay for it.
I tried searching for an Orthopedic Surgeon through my insurance portal and more than 800 doctors popped up. How am I supposed to know which one is the best for ACL surgery? Too frustrated to even write about it.
I tweeted out to the cycling community that I got my NYC Five Boro Bike Tour prize early and asked for a recommendation for a surgeon. Of course I got about 100 different names, which only made me more confused. Then Anna from work suggested I use MD Insider, which my company provides. I narrowed the list to about 30 doctors who specialize in ACL surgery and were on my plan. I sorted by quality scores and then called the top three to see who had the best schedule. I feel better already just having an easy, logical way to find a doctor. Surgery in 12 days!
I got a bill from the ER for $1,300 and literally fell out of my chair when I opened the envelope. That’s a month of rent! And all the ER did was confirm what I had found online—nothing special. In the future, I’ll definitely go to urgent care. I just had NO IDEA how crazy expensive the ER is.
After laying on the floor and moaning for a while, I remembered our company also provides a service called “Health Advocate.” I wasn’t sure that was, but it sounded like something I needed! So I made a phone call, and guess what? My advocate was a real human, not a robot! She helped me negotiate down the cost of the visit to just $450. I can’t believe I’m even saying “just,” but it obviously could have been worse. Lesson learned.
The surgery yesterday went well but I was too groggy to form coherent sentences until today. My surgeon was fantastic and put all my fears to rest. She was in my plan’s network so my out-of-pocket portion was more manageable than I had anticipated. If all goes well I should be back on my bike in a month. Plenty of time to get ready for next year’s Five Boro Tour!
Think I was being overly optimistic. Now it’s a week later and I’m still in a lot of pain from surgery. My health advocate called me to check up on me a couple of days ago and I told her I was fine, because I still had pain meds then. I took my last pill last night and still need more. My cyclist friend Lia offered me her leftover topical lidocaine (how can she have anything leftover??) and I said no because I figured my surgeon gave me a one week dose for a reason. I’m also scared of becoming an opioid addict, because addiction runs in my family. It sounds preposterous now that I’ve written it down, but gimme a break, my knee hurts! I just want to bike.
The pain is getting better. I’m glad I decided to wait it out instead of grabbing Lia’s leftover meds. Today I went for a quick spin on my bike. I made sure to bike on flat terrain and the ride went well! I’m a little poorer now—though it could be worse—but at least now I’ll have a good story to tell at the post-race party next year. Still can’t believe the guy was juggling perfectly good bagels.
The health care market is getting more and more complicated. More than $4 billion has been invested in digital health in each of the past two years and investment activity remains strong in 2016. Just keeping up with all the latest developments is challenging, never mind the work required to evaluate solutions, decide what to implement, and then communicate and manage them. Conversely, we continue to see consolidation in the market -- health plans, PBMs, and health systems are consolidating and developing ACOs. Fewer choices and more choices all at the same time.
Enter consumers, who are feeling the demands of being given more responsibility and having to sort through all the tools being thrown at them to help them become better shoppers. The only problem is that shopping for health care is not like shopping for a flat screen TV or for a car. Besides the complexity of understanding the specifics of the care you are shopping for, the variation in cost can be unbelievable (for example, the price for a knee replacement in the US ranges from $18k to $57k or more). Further, studies show that many think health care that is more expensive is better quality. In short, we have not yet perfected the health care shopping experience. And yet, at the same time, consumer expectations are rising. We have evolved into a culture that expects to find the answer to everything on our phones -- either Google it or ask Siri.
Is there a better answer? What if you could build a program that would help your employees live healthier lives, simplify the health care experience and save money? What if someone had already built it -- would you buy it? As health care becomes more complicated, do you have the bandwidth to evaluate every new invention? Employers are giving serious consideration to delegated solutions. Recent articles have claimed growth in private exchanges has fallen short of expectations, yet between 2015 and 2017 the percentage of large employers offering an exchange for their active employees is expected to double (from 3% to 6%) and an additional 27% say they are considering moving to an exchange within 5 years. So I’m not sure I agree that activity has fallen short of expectations -- especially considering that a lot has been learned from the first-generation programs. I agree with NBCH's new CEO, Michael Thompson, and his comment in a recent EBN interview. The proof of the approach is in what happens next. We have been able to exceed the financial expectations of our clients who have signed on to Mercer Marketplace. We are ready with next-generation features. Why not give us a look?
Employee Benefit Adviser has recognized Mercer’s Sharon Cunninghis, the global leader of our private exchange Mercer Marketplace, as one of 17 private exchange leaders who are shaping the future of health care. “These executives from all parts of the industry are leaders in the space, forecasting trends and serving as ushers for what some are calling a new era of health care,” says the article. Indeed, Mercer’s National Survey of Employer-Sponsored Health Plans 2015 found that 6% of large employers either already use a private exchange for active employees or will by next year’s open enrollment – a 50% increase year-over-year – and that an additional 27% are considering switching to an exchange within five years.
We applaud all those honored by EBA for their work at the forefront of this innovative space. Sharon’s leadership has been instrumental in making Mercer Marketplace a standout solution in a fast-changing industry. Congratulations to Sharon – a well-deserved honor!
The looming excise tax is getting a lot of attention from employers — as it should. Based on their current plan costs, about one-third of employers are likely to become subject to the excise tax in 2018 when it first goes into effect, with many to follow in subsequent years. Without assertive action, it’s not a question of “if” plans will become subject to the excise tax, but “when.”
With a nondeductible tax of 40% applicable to plan costs above threshold amounts that generally start at $10,200 for single coverage and $27,500 for family coverage in 2018, the tax could have a significant impact on employers and their plan members.
Fortunately there are a number of strategies employers can use to mitigate excise tax exposure. One highly effective strategy is to introduce a private exchange such as Mercer Marketplace™. Employer experience with Mercer Marketplace since 2014 shows clearly how it can help minimize excise tax risk.
About 60% of employees choose lower-cost consumer-directed health plans on Mercer Marketplace. These plans cost less than traditional PPOs and increase at a slower rate than the overall health plan market. Growth in enrollment in CDHPs reduces the number of employees enrolled in more expensive plans that will be subject to the tax. Outside of Mercer Marketplace, however, achieving high CDHP enrollment has been a challenge. Mercer’s most recent survey of employer-sponsored health plans found that only about 25% of employees choose to enroll in the CDHP. One reason that Mercer Marketplace members are more likely to select a CDHP is that our platform transforms the enrollment experience into a consumer purchasing experience offering decision-support tools that help people figure out how much insurance they really need.
On Mercer Marketplace, year-over year costs from 2014 to 2015 rose by an average of 1.5%, without plan changes. This compares to an overall average market increase of 4.6% — after employers made plan changes worth 2%–3% of plan cost.
The combination of strong enrollment in lower-cost plans and overall plan cost increases below the market average make the Mercer Marketplace private exchange a strong strategy to consider for many reasons — and certainly for excise tax risk mitigation.
It’s going to be a busy open enrollment season for Mercer Marketplace. In 2014, its first year of operations, Mercer’s private benefits exchange provided access for 52 companies, with 220,000 eligible employees, retirees, and dependents. For 2015, those numbers have grown by about a factor of five: 247 companies have chosen Mercer Marketplace to provide access to more than 1,000,000 lives. Additional enrollments for 2015 will continue throughout 2014.
“The growth in people and companies attracted to our exchange platforms is a powerful demonstration of the broad applicability of Mercer Marketplace solutions,” said Julio A. Portalatin, our President and Chief Executive Officer. “Our clients and their employees are confirming that we offer the most flexible and complete private exchange in the market that meets the real needs of a wider spectrum of companies. Further evidence of our momentum is the acquisition of 40 new clients not previously served by Mercer’s health business in addition to our continued growth with existing clients.”
A 2014 analysis of purchasing behavior on Mercer Marketplace showed that, given the opportunity to choose from a range of benefit options, many consumers purchased lower-cost medical plans. That, combined with access to Mercer Marketplace network arrangements, care management and prescription drug programs, allows employers to achieve up to 15% medical plan cost savings. In addition, Mercer Marketplace drove an average savings of 10% on the cost of life and disability benefits. These savings are enjoyed by both employers and employees.
“These savings result from Mercer Marketplace’s purchasing power combined with consumer decisions to purchase coverage that is more appropriate to their personal needs,” said Sharon Cunninghis, Mercer Marketplace Leader. “The fact that employers were able to achieve significant cost savings while offering their employees the ability to personalize their benefits is exciting news. This satisfaction from both companies and individuals gives others confidence in the exchange experience and positions this as one of the standard benefits models of the future.”
In addition to the employer active and retiree clients, several companies have selected Mercer Marketplace as the platform for delivering voluntary benefits, with 330,000 employees (730,000 lives including dependents) eligible to select benefits through this program. Mercer also provides access to individual medical insurance coverage to an additional 750,000 individuals through our relationship with GetInsured. While enrollment in these offerings may initially be modest, using Mercer Marketplace for delivery of voluntary benefits and individual medical insurance provides an avenue for both employers and employees to begin to experience the advantages the exchange platform offers.
MetLife's annual survey finds only a third of employers are satisfied with the level of enrollment in voluntary benefits. Their press release suggests some best practices focusing on communication and personalization.
A few more best practices to consider: First, include voluntary benefits in open enrollment for medical and the other group benefit plans. Often, employers get lured into offering voluntary products at a different time of the year hoping to draw more attention to the products. Mercer survey data suggest the top two reasons employers offer voluntary benefits are to help employees take advantage of group purchasing power for coverages like home and auto insurance but also to fill gaps in employer-sponsored benefits with coverages like hospital indemnity. The ability to fill gaps is becoming more important to employees as deductibles continue to increase each year, and offering the plans side by side allows employees to coordinate their benefit choices.
Another best practice to consider is to give employees a decision-support tool during open enrollment that provides a holistic approach to evaluating individual needs and financial resources. In our initial offering of Mercer Marketplace, 35% of employees electing either a $1,500 or $2,500 deductible medical plan elected at least one supplemental health plan. This supports the idea that the availability of supplemental health benefits helps employees buy lower-cost medical plans.
In this article, having a choice of medical plans is identified as a disruptor. Three things to consider: First, most people with coverage from their employer only have one or two medical plans available to them. An exchange, whether private or public, does offer up more choice. Secondly, as we know from our first-year experience with the Mercer Marketplace private exchange, when you give people helpful decision support along with choice, the majority will "buy down" to a less expensive plan because they discover that they have been over-insured. Third, it is well documented that millions of dollars are spent annually in the U.S. on care that is inappropriate or unnecessary. Looking up prices, actively negotiating with providers, and using home remedies or over-the-counter medicines -- all of which tends to happen when health care consumers have more skin in the game -- is a good thing. The more active we all are as consumers, the better.
Interesting article in BI. Mercer Marketplace is available to companies with 100 or more employees. We have partnerships with more than 25 medical carriers, including many BCBS plans. Mercer's platform provides access to the full suite of benefits including medical, dental, vision, life, disability, and voluntary benefits. The decision deadline for January 1, 2015 effective date is in July.