Raise your hand if you’ve recently had a thoroughly positive conversation about healthcare in America, like one where people were smiling and talking about how great it is. No one mentioned the soaring costs, 3-minute doctor visits, confusing bills, or any other negative experience.
Right, thought so. As an employer, you may be asking yourself what can you do about it besides offer the best healthcare benefits you can.
But the truth is, employers are pivotal players in today’s healthcare system. Nearly two-thirds of all health coverage is employer-provided, which translates into a nearly one trillion dollar annual spend. Your purchasing power has clout.
Here are 4 ways companies like yours can help reshape the health benefits market in the years ahead.
- Pay For Value, Not Volume.
Value-based care is a term used to describe a number of strategies for reducing unnecessary care and encouraging the practice of evidence-based medicine by changing incentives for providers and patients. These include accountable care organizations, patient-centered medical homes and other types of narrow networks.
Studies point to the large degree of waste in the medical system, and as employers look at ways to flatten the medical trend curve, eliminating waste seems a logical place to start. Comparing utilization and claims data from a given market with national averages will reveal issues that can be addressed with value-based care strategies:
- Underuse: Is there too little preventative care, such as cholesterol and cancer screenings?
- Misuse: Are there too many complications following hospital stays, and a high re-admission rate?
- Overuse: Are there high numbers of procedures, such as knee and hip replacements, that may not always be necessary?
Value-based care can and should address these issues, improving the quality of care as it reduces unnecessary cost. But it also has certain entry costs for employers, such as care coordination fees and shared savings bonuses. All major carriers have agreements with value-based care providers, and if you’re self-funded, you’re likely already paying these added costs. To make sure you’re getting the greatest benefit, ask your carrier to be transparent about what you’re paying and what you’re saving.
- Join The Drive To Better Quality.
Quality means providers are delivering the right care at the right time in the right setting, error-free. It seems obvious, but the American healthcare system is still moving toward that goal.
Medical errors seriously injure or kill hundreds of thousands of Americans every year. And analysts estimate 34% of U.S. healthcare spending is wasted on things like inefficiency, unnecessary procedures, and the cost of treating medical injuries that could have been avoided.
How can you help turn this around? Make sure your providers are delivering quality data at least annually. If their numbers don’t thrill you, you can:
- Switch insurance carriers, or tie your contracts to higher-quality outcomes.
- Structure your insurance plans in a way that encourages your employees to seek out the higher-quality providers in your network.
- Personalize the Experience.
New technology is on your side in the challenge to engage employees in caring for their health. Here’s one example. Let’s say you discovered that 30% of your employees are smokers, and of those, most are between 20 and 30. Your smoking cessation program should offer:
- a sleek digital interface
- a buffet of online tools
- high-touch counselors who email and text
- rewards that appeal to Millennials, like gift cards
This kind of thinking can apply to medical providers, gyms, massage therapists—any business that provides healthcare to your employees. Hold your vendors accountable for achieving high patient satisfaction rates. Your employees are their customers.
- Embrace Disruption.
As an employer, you’re in a position to inject change into the healthcare system. Don’t be afraid to do it, even if it creates short-term disruption. Those quality goals you demand could be surprisingly effective, even if it means you switch to new wellness programs, providers—or even insurance companies.
Keep tabs on your vendors to ensure they’re producing outcomes that align with your company’s objectives. Define your expectations, and agree to a cadence for measurement and reporting.
If you have a weight loss program, for example, expect that a certain percentage of your employees will actually drop some body weight. As any physician will tell you, even small changes on the scale can produce major health improvements.
Four Strategies, Multiple Benefits
A healthier workforce means more productivity and better engagement overall. Your company, and your workforce, has everything to gain when you help lead the transformation of the healthcare sector. The bottom line—choose health partners that produce results. The expectation can create the reality.
A few weeks ago, President Obama signed the 21st Century Cures Act into law, allocating $6.3 billion in new spending over the next decade on medical innovation, including $1.8 billion for cancer research. The bill also streamlines the approval process for new drugs and medical devices and includes support for Electronic Health Records, precision medicine, interoperability, and mental health.
Outside of the government, we are also seeing significant growth in funding for digital health initiatives -- from $2.3 billion in 2013 to $5.1 billion in 2014 and $5.8 billion in 2015, according to CB Insights. In 2016, MobiHealthNews covered 194 funding deals, including some names already familiar to employers. Accolade Health, a digital health concierge platform, raised $70 million, Welltok, a health management company, raised $33.7 million, and Zipongo, a digital nutrition platform, raised $18 million -- to name just a few.
So how are employers taking advantage of the latest innovations in health care? It depends, but we've observed a few key approaches to innovation that are worth considering:
1. Focus on a Big Problem: Because it takes commitment -- and additional resources -- to implement, nurture and grow a new program, some employers focus on innovations that address a significant health issue in hopes of realizing the greatest return possible for their investment. A good example would be programs that focus on diabetes; there is solid medical evidence that behavior-change programs can have a positive impact on this prevalent chronic condition.
2. Narrowcasting: On the other hand, some employers focus on programs that touch fewer people but can make a huge difference in peoples’ lives, such as programs that address infertility, autism, or high-risk medical procedures.
3. Go Different: Or perhaps a different approach all together? In the category of unintentional health applications, Pokémon Go, which uses augmented reality to allow users to capture monsters in real life, had an estimated 7.5 million downloads in one-week. Pokémon Go uses the player's phone camera and GPS, so players must physically move around in order to advance in the game. (One player even logged 24 miles over the course of a couple of days walking around San Francisco, and collectively, users have walked 5.4 billion miles, which extends from the Earth past Pluto!).
And as the percentage of Americans who own wearable devices that track fitness rose to an impressive 25% in 2016 (according to a survey from Rock Health), companies may want to consider a BYOD -- bring your own device -- program that encourages employees to keep active using whatever device they’ve chosen and purchased for themselves.
Looking for guidance on how to take advantage of health innovations as you look for new ways to manage cost and engage plan members? Check out Mercer's webcast from January 19: Innovation in Healthcare: Embracing Disruption. We will share some practical suggestions for navigating the surge in healthcare technology solutions as you begin your planning and strategy for 2018 and beyond.
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.
One idea that was explored in great depth at the conference was that the transformation of healthcare will be driven by the consumer. But how would that work when consumers don’t really speak with a single voice? Can true transformation occur when every consumer is different, with unique preferences? In fact personalized healthcare is happening already and research is showing some encouraging results.
During the conference I had an opportunity to participate in an onsite tour of an organization that is passionate about understanding consumer behavior to shape personalization and ultimately achieve better outcomes. Emmi Solutions supports healthcare systems and physician groups by providing communication technology that allows them to extend their reach with virtual patient interactions – but without losing the human touch. For example, a woman is diagnosed with breast cancer and is presented with options by her treating provider – lumpectomy with radiation/ chemo or mastectomy. Emmi provides a decision support video that explains in simple language (no medical terms) and images what to expect on each path she might choose – what it might feel like; how she might look in a party dress or swimsuit. The intent is to connect with the consumer to help her understand what each option entails and how she might react, so she can be prepared with relevant questions when she next meets with her physician.
Behind the solution is some great research in understanding consumer behaviors. Demonstrated success in improving patient engagement has been linked to a few key principles:
- Shared decision-making is paramount to better relationships that are sustained over a longer period of time. Finding ways to help consumers make their own decisions and be involved in the process results in better engagement.
- Connect with consumers the way they want to be connected with – through words, graphics and other modalities. Meet consumers where they are by listening to individual needs.
- Make it simple. Even the most complicated medical conditions need to be explained simply.
As employer health plan sponsors know, consumers don’t always act rationally when purchasing services. But, as the work of this organization shows, executing on the fundamental goal of understanding the consumer by listening and connecting in ways that make sense to them, is an important step toward a more rational consumer experience.
The idea of “is it really about me” can be further explored in Dr. Kyra Bobinet’s book, “Well Designed Life,” which discusses how neuroscience can be used to change behavior. The book shares key insights into why people do what they do and how they can change by understanding personal motivations. Her research is based on the point of view that an individualized approach is central to bringing change. She also acknowledges that the change game is never over and challenges people to “keep tinkering with the design.”
Personalizing the experience is not just about a different plan design or cool technology. It is about working relentlessly to understand the consumer – who they are, where they are – and about continued focus on making it simple. Consider how transformative the experience would be if all your vendor partners focused on consumer behavior to deliver better engagement. So strive for it! Probe any partner supporting your employee healthcare experience throughout the system to show how and where they are using consumer science for better outcomes. Demand that they “make it simple and make it about me.” That’s what your employees want….are you listening?
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.
Prepared or not, a new healthcare market is emerging. Every stakeholder group operating in the healthcare ecosystem is changing. We’re seeing the simultaneous consolidation and fragmentation of carriers and providers, continuous introduction of tech start-ups bringing entirely new design mind-sets, and tumultuous evolution of the public exchange. Employers, who play the pivotal role of providing coverage for more than 60% of all those insured in the US today, are adopting new, aggressive strategies to shape the rules of the road in the new healthcare landscape.
One of the highly charged areas of change is around the evolving healthcare relationship between employer and employee. We know that healthcare benefits rank second only to pay in the employment value proposition. Employers are “staying in the game,” but wrestling with how to do it more efficiently and more effectively.
The theme of “Move Faster / Fail Smarter” was introduced at the Oliver Wyman conference as an underlying mantra of how to rapidly transform the healthcare ecosystem. What’s the applicability of this concept to employers? Can we, too, move faster and fail smarter?
Let’s say that an employer wants to transform their current wellness program from a one-size-fits-all model to a highly personalized health paradigm delivered by various new wellness tech entrants like Livongo (diabetes), Omada (pre-diabetes), Progyny (infertility), Kirbo (family weight management), and others.
- Would your procurement colleagues be ready to assess the capabilities of multiple wellness point solutions all at the same time?
- Could contract terms be negotiated rapidly with each?
- Would you have the administrative infrastructure to manage an exponential increase in the number of vendor contracts?
- How would you communicate the availability of these new programs in meaningful ways so your employees get personalized notifications that are relevant and timely to meet their specific needs?
- What happens if one of these programs fails to meet expectations or a brand-new startup has emerged and leapfrogged the competition? How quickly could you make a change?
These are all real considerations in the quest to move faster. While many employers have successfully created a culture that supports program pilots, others feel that pilots require the same degree of upfront heavy lifting as a full program roll-out. Here are a few ideas that could make it easier:
- Meet with Procurement to create a new model for health and wellbeing vendor management.
- Include Net Promoter Score as a key metric of success for all of your health and wellness partners – if your employees don’t have a magnetic, positive experience, it will be impossible to yield a positive ROI because engagement will be too low.
- Create a checklist and guidelines to assess new entrants consistently and proactively. It can be a full-time job to meet and vet new vendors in this space, which is completely unsustainable. Instead, know your cost drivers and risk areas – agree to meeting only with vendors who solve a high-priority problem for your organization.
Conducting pilot projects may be a “smarter way to fail” in your organization. The possibility that the initiative won’t be right for your organization is baked into the concept of a pilot. The key is to conduct the pilot in such a way that, whether you ultimately move forward or not, you’ve learned something to apply to your next effort.
In late May, Martin Senn, the former CEO of Zurich Insurance Group, took his own life just months after leaving the company. Only three years earlier, the company's former CFO, Pierre Wauthier, also committed suicide, and not long after that, so did Swisscom CEO Carsten Schloter.
Statistics about senior executive suicides are scarce. Often, these tragedies are hidden from public view, with only the most prominent making the news. But suicide has cast a shadow on Silicon Valley. A disturbingly high number of founders and entrepreneurs have chosen this path: Austin Heinz, with Cambrian Genomics. Aaron Swartz, with Reddit. Jody Sherman, with Ecomom. Ovik Banerjee, with Venture for America. Matt Berman, with Bolt Barber. Ilya Zhitomirskiy, with Diaspora. Ian Gibbons, with Theranos. (And I worry that the problem is moving downstream. Last year, in the Silicon Valley town of Palo Alto, home to Stanford University and Facebook, there were four high school suicides.)
The pressure on executives and entrepreneurs is daunting. Picture feeling overwhelmed, at your most vulnerable, and not being able to share it because it might put at risk funding, or an acquisition, or an IPO. Who wants to follow or invest in a leader who is exhibiting weakness? On the entrepreneurial roller-coaster, there can be amazing highs and crashing lows.
The general statistics on suicide are sobering enough:
- Suicide is the 10th leading cause of death in the US for all ages. (CDC)
- More people die from suicide than homicide and war combined. (WHO)
- There is one death by suicide in the US every 12.3 minutes. (CDC)
- Depression affects 20-25% of Americans age 18 and over in a given year. (CDC)
- Suicide takes the lives of over 38,000 Americans every year. (CDC)
- 45% of suicide victims had contact with primary care providers within the prior month. (American Journal of Psychiatry)
- An estimated quarter million people each year become suicide survivors. (AAS)
Yet executives and entrepreneurs are apparently at still higher risk. Dr. Michael Freeman, a clinical professor at UCSF and himself an entrepreneur, has studied the connection between mental health issues and entrepreneurship. Of 242 entrepreneurs surveyed, 49% reported having a mental-health condition. Depression was the most reported condition, present in 30% of the group, followed by ADHD (29%) and anxiety problems (27%). As a point of comparison, the general US population only reports 7% as depressed.
This is a problem that needs to be addressed. There is a lot of loneliness and depression in this world, and many people feel like failures because they can’t live up to impossibly high standards they see in the media or set for themselves. Perhaps Silicon Valley can heal itself. There are any number of new startups attempting to solve different issues in the mental healthcare space, which may include access to care, delivery of care, or quality of care. Notable names include Lantern, Ginger.io, Lyra, and Breakthrough (acquired by MDLive).
But this is also a cultural issue. Suicide needs to be openly discussed; stigmas need to be removed. On National Council Hill Day 2016 last month, hundreds of behavioral health providers, administrators, board members, consumers, and community stakeholders gathered in Washington DC and visited Capitol Hill to advocate for better resources for mental health and addiction treatment in their communities.
It’s been painful to read some of these statistics and stories as I researched this post. There are times during my own academic and professional career when I have gone through periods of depression, and wasn’t sure how to ask for help. (Fortunately, I’m in a happy place now.) If you’re reading this as a benefits professional, do your employees -- and your execs -- have easy access to help? And if you yourself are going through a hard time, remember there are people you can talk to, without fear of judgement or implication.
If you're struggling and need help, reach out to the National Suicide Prevention Lifeline by calling 1-800-273-8255 anytime.
Wow, it’s June already. Kids are playing outside, the smell of barbeque is in the air, and some of us, just maybe, are feeling the onset of the innovation summertime blues. What, you’ve never heard of this particular brand of the blues? Let me paint a picture and maybe it will look familiar.
You’d been hearing about all these new startups and innovations in the healthcare market, and one or maybe two of them caught your attention. So you took the plunge, and now you’re in the midst of planning a pilot or even a full blown rollout. But three to six weeks in, what you’re feeling now is “Wow, this is a lot of work! Is this all worth it?” or “Hmmm…this isn’t all that I expected. Seems like there’s some vaporware here that needs to be built before launch.”
Those, my friends, are the innovation summertime blues! The initial buzz and excitement has worn off and the real work, some of it pure drudgery, has begun. But take heart. Here are six tips to help battle this summer affliction:
- Preview your innovation with some potential employee users. Those who love the product will recharge your energy with fresh perspective…and those who are critics may push you harder to try to win them over.
- Become a real user of the product. If you really kick the tires on the system, you’ll reduce unpleasant surprises – like finding out that something you assumed was part of the product suite or service model, isn’t.
- Take a break and listen to this short motivational excerpt from Steve Jobs!
- Talk to other employers who have already rolled out the program. Hear what went well and what didn’t and see if there are learnings that you can apply.
- Put together contingency plans. What if user engagement is lower than your targets? (First off, what are those initial targets?) Do you have a plan (and potentially budget) to address low engagement? On the flip side, what if engagement is higher than expected? (One can dream…it has been known to happen!) If there is too much stress on the system, what’s Plan B? You can only foresee so much, but scenario planning can minimize anxiety beforehand and improve your response to problems afterwards.
- And last but not least, breathe! All these bumps in the road and challenges are supposed to happen – it’s the nature of innovation! In any case, before you know it, fall will be here and you’ll be in the thick of open enrollment. At least the kids will be back in school. :)
This post is part of our 2017 Planning Checklist series.
A scan of news headlines from the past couple of months netted articles discussing genetic links to anxiety, glaucoma, weight gain, intelligence, athletics, cancer, and smoking. It’s not unimaginable that genetics could play a role in managing every aspect of our health. The trick will be figuring out how to counterbalance genetic predisposition with behavioral changes and clinical support.
Genetic testing companies fall into different buckets, based on whether they’re focused on the past, present, or future:
- PAST: To help you determine your ancestral origins, trace your lineage and find new genetic relatives, there are tests with a genealogical focus offered by Family Tree DNA, 23andMe, and Ancestry DNA.
- PRESENT: Genetic screening is being used to determine genetic variations and personalize recommendations and coaching based on your specific needs. As an example, Newtopia tests for genetic variations affecting body fat, eating behavior, and appetite, and adapts its program based on your results.
- FUTURE: Some companies focus on DNA screenings for the important moments in your life; for example, Counsyl and Color Genomics offer tests aimed at family planning, pregnancy, and cancer screening.
With the ability to test potential parents for inheritable conditions like cystic fibrosis, or risk for diseases like Parkinson’s, genetic testing may one day become the expected standard for care delivery. In the meantime, there are still some privacy concerns. While the Genetic Information Nondiscrimindation Act (GINA) bars health insurance companies from denying coverage to those with risky gene mutations, the law doesn’t extend to life insurance companies, long-term care, or disability insurance.
Speed of testing, accuracy, financial cost, counseling support, and privacy are all factors that should be considered when evaluating services in this space. But the possibilities certainly seem to warrant discussion. Are you starting to think about these new types of services and how they might benefit your workforce?
Telehealth offers health care consumers greater convenience and the chance to save money -- but it only works if the provider speaks the patient’s language. To that end, Mercer has formed an alliance with ConsejoSano to bring telehealth services to the Spanish-speaking population. ConsejoSano provides consumers with instantaneous access to Spanish-speaking doctors, mental health specialists, and nutritionists.
Many groups have been looking at the health differences between racial, ethnic, and socioeconomic groups:
- The most recent National Healthcare Quality and Disparities Report reveals that the Hispanic population has triple the rate of uninsurance and worse access in 14 of 21 access-to-care measures.
- The CDC reports higher rates of obesity, diabetes, and hypertension in the Hispanic population.
- The U.S. Department of Health and Human Services: Office of Minority Health has stressed the importance of cultural and linguistic competency to provide respectful and responsive health services.
- According to the Census Bureau, Hispanics are the least likely racial or ethnic group to seek medical care, with 42% having not visited a provider during the past year.
On the plus side, there’s growing recognition of the importance of supporting these unique segments within our population. Interestingly, the conversations around diversity and inclusion within the workplace are starting to transform into diversity and innovation:
- The first phrase within Apple’s Diversity vision states that “Inclusion inspires innovation.”
- Merck’s Center of Talent Innovation recently reported that companies that attach a high degree of importance to diversity are demonstrably more innovative than companies with a more homogeneous workforce.
- Harvard Business Review reported on two types of diversity classifications: inherent (such as gender, ethnicity, and sexual orientation) and acquired (such as the experience of living in another country). Companies/leaders with at least three inherent and three acquired diversity traits showed 45% greater likelihood for market-share growth.
- Johnson & Johnson’s Global Head of Research & Development, Martin Fitchet, has presented on his viewpoints that diversity and innovation are inseparably linked, which dovetails with J&J’s mission to cultivate a diverse workforce and unleash innovative thinking.
Has your organization recognized that ethnic/racial health disparities exist, and thought about a response? Framing the conversation in terms of diversity and innovation might clarify the business case for action.
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.
What most caught my attention is the notion that what will make or break an innovation is not the partner you choose as much as the architecture surrounding the partner. The essential drive to innovate will clearly result in some good ideas and some not so good ideas. A sound architecture should enable employers to plug in and take out partners without losing momentum. As one speaker commented, “Failing forward is good….failing backward isn’t.”
There are a lot of solutions and products on the market for employers. The challenge is how to create a context for them that reduces the risk inherent in working with different partners and keeps the focus on providing value to employees/consumers. A really cool architecture would help employers to address each component of the “triple aim” – and do a lot to improve the consumer experience.
Check it out. The list is definitely provocative. Employers make the list at #10 with a prediction that they will become (even more) active in imposing requirements on plan members like limiting the number of providers they can use and requiring second opinions. I thought there was merit in the suggestion that members be required to access telemedicine before going to the ER – it seems like a win-win since the member could avoid the ER visit altogether and limit their out-of-pocket expense. The authors also predict that video-telemedicine will rapidly become the way people access care in the future.
Mercer’s sibling company, management consulting firm Oliver Wyman, recently hosted a stimulating conference in Chicago – “Health Market 2.0”. A number of Mercerites attended to learn more about direction of the health care industry and the forces shaping its evolution. The sessions focused on several themes, including population health, value-based care, precision medicine and the empowered consumer. None of these themes are new to employers, but thinking differently about how to make it work – how to thrive in the chaos of innovation and transformation – was new. The challenge is to focus on what people need and how they would like to get it – not what the market has to offer.
Over the next several days, colleagues who attended the conference will share their take-aways and insights in a series of posts on this site. One thing is for sure: change is happening and you want to be positioned to take advantage of all it has to offer.
The long Labor Day week-end is in sight, and summer is quickly becoming a memory. Many of you are getting down to the wire on 2016 benefits decisions. Will 2016 be a year for big change? After all, we are closing in on the effective date for the excise tax on high-cost plans in 2018 … or are we? Some are holding out, as they have with other ACA milestones, in hopes that the Cadillac tax will be repealed. All the while, plan sponsors (and their advisors) remain actively engaged in the quest to find the perfect balance between cost, quality, and member engagement.
Lin Grensing-Pophal wrote a piece that ran this week in Human Resource Executive online titled “Tracking Healthcare Trends,” in which she discussed NBGH survey results and new design strategies employers are implementing in 2016. Yours truly got the last word: “I think these are really exciting times to be in our business … With each passing day, we just get more and more opportunities for different types of strategies. It’s a lot to take in, but I think that there are a lot of great opportunities for us to continue to not only manage costs, but to drive better quality and to maintain or improve the health of the population. Those are all good things.”
I really do believe that! Employer-sponsored plans have become the incubators for so many new innovations:
- New care-delivery models, such as accountable care organizations (ACOs) and other network-based models, that are designed to promote value-based care.
- Countless new gizmos that track activity, measure progress in fitness challenges, monitor medication adherence, or record metrics associated with diabetes or diet.
- Brand-new health plan models, such as Collective Health, that promise to exceed customer expectations for how good a health plan can be.
- Private exchange options, like Mercer Marketplace™, that have secured a foothold in the employer market and continue to grow in popularity.
- Consumer engagement models, such as Accolade, that boast member satisfaction and net promoter scores never before seen in the industry.
- Digital platforms like Jiff — a new Mercer collaborator — that provide an easy-to-navigate user experience to drive utilization of the right health care services, by the right people, at the right time.
If you haven’t yet explored the landscape of new options, take time to press the “reset button” and look at everything the market has to offer before you begin planning for 2017. I promise you will not be disappointed.