Managing high-cost claims is top of mind for employer-sponsored benefit plans

Diving brief:

  • Employers continued to see moderate growth in health benefit costs of 3.6% in 2018, but projections of a 4.4% increase this year would outpace the consumer price index and employee revenue growth, a new Mercer Poll warns. Medium and large companies were better able to control their costs than small companies.
  • When asked about their top short-term strategies for managing health plans, “monitoring and managing high-cost claims” was No. 1 for the second year in a row, followed by “creating a culture of health.” “.
  • While controlling rising costs is a constant goal, employers are also focusing on a benefits package that supports a healthy workforce. Telehealth and hyper-focused point solutions on a specific aspect of wellness are among the perks some offer workers.

Overview of the dive:

With rising healthcare costs a constant battle, many employers are avoiding payers and contracting directly with providers to care for their workforce. Big names like Boeing and Walmart are already doing it, and Amazon-Berkshire Hathaway-JP Morgan Chase’s Haven was founded with the explicit goal of improving healthcare and lowering costs for their 1,2 million employees.

Haven last week hired Sandhya Rao, senior medical director of Partners Population Health, to lead its clinical strategy, suggesting it could seek to form its own supplier network and contract directly with hospitals and outpatient clinics. .

While 18% of employers surveyed saw total health plan costs increase by more than 10% in the past year, a third (31%) saw cost growth of 5% or less and more than a quarter (27%) saw no change.

Medium and large businesses fared better, with cost growth of 3.2%, while smaller businesses with fewer resources for cost management experienced “significantly higher” increases, according to the report.

To engage employees in cost containment, companies have increased PPO deductibles, provided financial incentives for health assessments and screenings, and offered account-based, consumer-led health plans. Compared to PPOs, HSA-eligible CDHPs hold more promise for savings, with an average cost per medical plan employee of $1,357 compared to $12,486 for an OPP, according to the report.

The survey results suggest that employers are already taking steps to take advantage of market opportunities. Almost a fifth (18%) of respondents said they offer workers a good network, while 80% offer telehealth, an increase of 18% compared to 2014. More than half (56%) offer solutions punctual, while 25% direct workers in need of a transplant to centers of excellence. Among medium and large companies, around half of their employees who need specialist medicines go to specialist pharmacies, and this share rises to 80% of giant employers.

Employers are also integrating health into their corporate culture. About four in 10 large and medium-sized employers said it is the company’s mission to embrace a healthy work culture, up from 23% in 2017. To support this goal, employers provide healthy food choices in cafeterias and at workplaces. events (63%), banning smoking on campus (57%), implementing policies that promote work-life balance (45%), and providing on-site fitness space (42%).

Mercer also identified 27 best practices companies are using to support employee health and manage costs. Not surprisingly, those using 14 or more experienced the lowest average cost increase, at 3.2%. Those who use seven or less have seen their costs increase by an average of 5%.

Previous HANYS Benefit Services named one of PLANADVISER's Top 100 Pension Advisors for the 3rd time - HANYS News February 22, 2019
Next Excess benefit plan | Retirement | Benefits & Well-being | BCN HR Shared Services