Although the new federal health care law is designed to help people buying individual policies, even people with employer-provided policies are beginning to see changes in their coverage as companies rethink health care for their workers, discontinuing it in a few cases and redesigning it in many others.
They are motivated by a need to rein in health care costs, which continue to rise faster than overall inflation, but the federal health care law is also changing how some view their obligations to their employees.
Some major firms, like Walgreen, the drugstore chain, are giving those who qualify money to buy insurance on a private health exchange. Aon Hewitt, a benefits consultant that will oversee health plans on Walgreen’s behalf, said 18 large employers had signed up so far, including Sears and Darden Restaurants.
But here in Cincinnati, General Electric is taking the opposite approach.
One of the largest employers in the nation, it spends more than $2 billion a year offering coverage to 500,000 employees and retirees and their families. And it is using its considerable clout in places like this — where its giant aviation business gives it a major presence — to work directly with doctors and hospitals to improve care and reduce costs.
“I don’t know anybody who isn’t trying almost everything,” said Helen Darling, president of the National Business Group on Health, which represents employers providing benefits. “We’re going to see a lot of activity in the next couple of years.”
Over the last few years, G.E. has pushed for the creation of so-called medical homes, in which an individual medical practice closely coordinates a patient’s care by having access to all of the patient’s medical records.
In Cincinnati, about 118 doctors’ practices have converted to medical homes, and all five of the major health systems are making their primary care practices move in that direction. G.E. has also pushed for greater transparency of results.
“If we don’t take accountability ourselves for figuring this out, we’re part of the problem,” said Sue Siegel, a senior executive at G.E., who sees transformation of health care both as a business opportunity and a business necessity.
“We have to be involved in the solution,” she said. “We can’t just wait for someone to tell us that it is going to be fixed.”
What distinguishes the effort by G.E. is its direct focus on hospitals and doctors. Companies looking to the private exchanges are largely hoping to save money and want to be freed from the headache of administering health benefits.
In Walgreen’s case, the company says it doesn’t plan to lower its share of its workers’ health care costs but hopes to foster more competition among insurers, leading to better prices and more choice for employees.
In Cincinnati, G.E. took on both a cheerleading and coordinating role. In early 2010, Jeffrey R. Immelt, its chief executive, addressed local business leaders and urged them to think strategically and align their efforts to make more of a difference. There were already significant efforts under way to foster medical homes, for example, and G.E. pushed to find more financing to expand the concept to more medical practices and keep the focus on that initiative.
“The ever-present vigilance of the employers help nudge things along,” said Craig Brammer, chief executive of three area health care coalitions, including the Greater Cincinnati Health Council, which is made up of the area’s hospitals, health plans and employers.
The city’s health systems say they recognize that insurers and employers are increasingly going to reward them for better tracking their patients in and out of the hospital. “We are clearly gearing up to change directions from fee for service for what I’ll call payment for value,” said Will Groneman, an executive vice president for TriHealth, one of the systems.
Date: September 26, 2013