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Mercer

This post is part of our “Driving Transformation” series, in which Mercer consultants share key take-aways for employers from the 2016 Oliver Wyman Health Innovation Summit, a recent conference hosted by Mercer’s sibling firm, management consultant Oliver Wyman.

  

At many points throughout the conference, with its deep focus on a “consumer-led transformation” of health care, I was challenged to think about a fundamental element of such a transformation: consumer behavior change.  Can we really teach healthcare consumerism skills? Can we instill a sense of shared accountability for health within a patient, who may have little or no financial “skin in the game”? And if we’re successful moving the needle on healthcare consumerism skills and sharing responsibility for prudent healthcare decisions, can these skills and responsibilities be called upon in the exceptional situations where healthcare is complex, emotional, and high risk? After all, these are the situations that account for the majority of healthcare costs.

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Employers are grappling with the escalating cost of healthcare benefits. HR and finance leaders are adapting -- as are employees across the nation -- to a ‘new normal’ of narrow networks and high deductible plans. Basic coverage is increasingly augmented by voluntary benefits to meet the varied needs of employees and their families. During this ongoing transition, employees are being asked to more actively participate in the enrollment process.

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As we’ve reported, consumer-directed health plans have mushroomed during the health reform era. In 2015, exactly half of all large employers (those with 500 or more employees) offered a CDHP eligible for a health savings account -- yet only 5% offered it as the sole plan available to employees at their largest worksite. Still, many employers are at least thinking about a full-replacement strategy. 

 

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This post is part of our “Dear E.B.” series, in which Mercer’s very own advice columnist (“E.B.,” for Employee Benefits) responds to questions concerning health and well-being that are on the minds of employees across the country.

 

Dear E.B.,

My employer just changed our benefits. They added this medical plan called a “CDHP plan” and some other things called “Voluntary Benefits.” The cost for my current plan, with a $350 deductible, is going up by 23% and I don’t think I can afford it anymore. The cost of the CDHP plan is a lot lower but I’m worried that if I get sick or have an accident, I wouldn’t be able to come up with the cash to go to the doctor -- or worse yet, pay for any time in the hospital. If I enroll in that CDHP plan I feel like I’ll never be able to leave the house and have to keep myself away from all the germs that could get me sick. It is flu season… Help!!!!

 

Living in a Hazmat Suit

 

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This post is part of our “Visualizing the Future:  Health Benefits in 2016 and Beyond” series, in which Mercer consultants share key take-aways for employers from “Health Market 2.0,” a recent conference hosted by Mercer’s sister firm, management consultant Oliver Wyman.  

 

The convenience factor is undeniable, but will consumers (employees) be comfortable with the retail setting for quality preventive and primary care? If so, and even if Gen X and Millennials adopt this first, does it represent an opportunity to rethink plan design in such a way as to maximize value from the retail health setting, reduce overall benefit value, and focus on catastrophic coverage once you enter the traditional ecosystem?

 

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This post is part of our “Visualizing the Future:  Health Benefits in 2016 and Beyond” series, in which Mercer consultants share key take-aways for employers from “Health Market 2.0,” a recent conference hosted by Mercer’s sister firm, management consultant Oliver Wyman.  

 

During a session on provider quality transparency for consumers, I was disturbed to learn that two vendors in the space who had representatives at the conference base their quality data on consumer feedback, similar to online Yelp reviews. While there’s an important place for that data, it is not a measure of quality but of customer satisfaction. Given the relatively poor job the cost/quality transparency companies have done on the quality assessment side, it is easy to understand how this consumer data has come to fill the void. However, with the release of the CMS data set and inferential attribution tools, we are seeing very sophisticated quality assessment tools beginning to emerge that can meaningfully distinguish quality among providers.

 

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This post is part of our “Visualizing the Future: Health Benefits in 2016 and Beyond” series, in which Mercer consultants share key take-aways for employers from “Health Market 2.0,” a recent conference hosted by Mercer’s sister firm, management consultant Oliver Wyman.  

 

As we work on educating employers to become better health care consumers, we need to keep in mind a fact so obvious that it’s easy to miss. Ready or not, consumers are already driving market transformation -– and the fact that they generally have little health care literacy is shaping the new health care marketplace, spurring the development of solutions to simplify and streamline decision-making and interactions. Employers that put off addressing engagement and consumerism may find themselves at a disadvantage in recruiting and retaining employees.

 

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Right now, consumer-directed health plans (CDHPs) are at the top of the list of key cost management strategies. For employers looking to build a health program that’s sustainable over the long term, a plan that’s designed to change employee behavior — to make them better health care consumers — has a lot of appeal. So much appeal that we’ve seen the percentage of covered employees enrolled in CDHPs more than double over the past four years. In 2014, nearly half of all large employers offered a CDHP, and 23% of their employees were enrolled. By 2017, 66% of large employers expect to offer a CDHP.

 

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