Facing another 5% increase in health-care benefits costs, more large U.S. employers plan to focus on how they deliver and pay for health care while still looking at traditional methods of controlling costs.
“Employers are recognizing that traditional cost-control techniques alone aren’t able to reduce costs to the point where they are no longer a drain on the bottom line,” said Brian Marcotte, president and CEO of the National Business Group on Health, which published its annual “Large Employers’ 2018 Health Care Strategy and Plan Design Survey.”
Employers’ efforts will result in more employees having access to broader health-care services, including telemedicine, Centers of Excellence and onsite health centers during open enrollment, all while not experiencing major increases in costs. Employers projected the total cost of providing medical and pharmacy benefits to rise 5% for the fifth consecutive year in 2018.
Including premiums and out-of-pocket costs for employees and dependents, the total cost of health care is estimated to be $13,482 per employee this year, and projected to rise to an average of $14,156 in 2018. Employers will cover nearly 70% of those costs while employees will bear about 30%, or nearly $4,400 in 2018. For the second consecutive year, employers ranked specialty pharmacy (26%) as the top driver. Eight in 10 employers ranked it among the top three cost drivers. Specialty pharmacy costs likely will remain a top concern as new, high-priced drugs come to market.
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“While employers continue to address costs through health-care management and plan-design efforts, they are also ramping up efforts to positively affect the supply side of the health-care system by pursuing health-care payment and delivery-reform initiatives,” Marcotte said.
According to the survey, more employers plan to adopt the following strategies:
- Telehealth: 96% of employers will make telehealth services available in states where it is allowed next year. More than half (56%) plan to offer telehealth for behavioral health services, more than double the percentage this year. Telehealth use is on the rise, with nearly 20% of employers experiencing employee use rates of 8% or higher.
- Accountable Care Organizations (ACOs): 21% of employers plan to promote ACOs in 2018, but that number could double by 2020 as another 26% are considering offering them. Employers are slightly more confident about the ability of ACOs to improve health-care quality beyond what the system does today, compared to reducing costs.
Health Centers: 54% of employers will offer onsite or near-site health centers in 2018, and that number could increase to nearly two-thirds by 2020. - Centers of Excellence (COEs): 88% of employers expect to use COEs in 2018 for certain procedures, such as transplants or orthopedic surgery. Bundled payments or other types of alternative payment arrangements will be used by 21% to 48% of COE contracts, depending on the medical procedure or condition.
- Value-Based Benefit Design: Nearly 40% of employers have incorporated some type of value-based benefit design in which employees receive reduced cost sharing or premium reductions when they take steps to manage chronic conditions or obtain higher quality or more efficient care. There has been some increase in the use of value-based benefit design to steer employees toward telehealth (18% in 2018 vs. 16% in 2017).
“One of the most interesting findings from the survey is that employers are focused on enhancing the employee experience,” Marcotte said. “For example, there is a big increase in the number of employers offering decision support, concierge services and tools to help employees navigate the health-care system. The complexity of the system and proliferation of new entrants has made it difficult for employees to fully understand their benefit programs, treatment options and where to go for care.”
66% of companies will offer medical decision support and second-opinion services in 2018, the survey reported, reflecting an increase of 47% from this year. Also, the number of companies offering high-touch concierge services will jump from 28% this year to 36% in 2018.
“As employers look ahead, we expect them to increasingly focus on value purchasing opportunities within the delivery system and improving the experience for health-care consumers,” Marcotte said. “Finding solutions to the growing challenge of skyrocketing specialty pharmacy costs will also remain a top priority.”
Date: August 09, 2017