In our October blog, we walked you through the importance of communicating health benefits effectively to your employees, helping them become better consumers of healthcare, which create a better benefits offering and organizational culture that impacts retention.
We discussed that 78% of employees reported being more likely to stay with an employer because of their benefits program.
The blog post also addressed the impact of the current inflationary period on healthcare costs and how employees living paycheck-to-paycheck face the challenge of choosing between paying for groceries or taking care of their health.
A study by SHRM found that employer-provided health coverage is essential for recruiting but even more important for retention.
The survey showed that:
- 56% of U.S. adults with employer-sponsored health benefits said that whether or not they like their health coverage is a crucial factor in deciding to stay at their current job.
- 46% said health insurance was either the deciding factor or a positive influence in choosing their current job.
In our recent LinkedIn survey, 78% of Advisers said that increasing Out-Of-Pocket (OOP) cost to employees has been the #1 strategy (45%) used by employers to cut healthcare premiums.
When the increasing cost to employees is your #1 strategy, something needs to change.
The reality has resulted in the following:
- Most employees are “functionally” uninsured- although they have health insurance coverage, the OOP is so high they can’t afford to use their plans.
- 2 in 5 (40%) employees with deductibles from $1,000 to less than $4,000 do not have adequate savings to account for a significant medical expense.
- 25% of employees at the lowest deductible level (under$1,000) run the risk of not being able to cover a significant medical expense with their existing savings.
- Regardless of the deductible amount, all members said the cost of healthcare makes it more likely they will avoid care altogether.
- Employees don’t feel as much value from their employer’s benefits program.
THE STATUS QUO STRATEGY DOESN’T WORK.
With this in mind, this month, we want to share three (3) strategies to take a deductible increase and turn it into a BENEFIT:
1. Promoting access to QUALITY healthcare
2. Adding the cost of Direct Primary Care (DPC)
3. Changing the way you structure the Rx program
Promoting Access to QUALITY healthcare
Access to quality healthcare can allow you to WAIVE at all costs—and yes, provide FREE healthcare. Healthcare quality and cost can be drastically different in the same city, even in the same practice.
Still, normal #BUCAH (Blue Cross, United Healthcare, CIGNA, Aetna, Humana) style plans don’t help members be better healthcare consumers.
The healthcare industry has promoted the word “consumerism” for years, which, in its pure definition, is the protection or promotion of the interests of consumers.
Are you protecting and promoting the interests of employees by increasing their out-of-pocket costs?
Consumerism in our industry SHOULD be about making people better healthcare consumers by giving them the tools, resources, and, more importantly, the structure of how a health plan works.
Employees “spend their money differently than their employer’s”, and increasing out-of-pocket costs makes employees and their family members “think twice” about accessing healthcare.
This has been how the industry has addressed “consumerism”.
This strategy alone is dangerous and lacks empathy for employees and their families, especially in this inflationary period. Incentivizing employees, and their families, to seek the highest quality healthcare, providing them with a healthcare advocate to support their decision-making, and waiving their OOP cost when they engage, that’s what we call CONSUMERISM.
Adding the cost of Direct Primary Care (DPC)
Let’s raise the deductible, take some of those “savings” and add Direct Primary Care (DPC). DPC is providing an enhanced primary care experience for employees, and their families, by:
1. Eliminating the fee-for-service model and including an “all you can eat” model of primary care to remove the cost barrier for members to seek care and be more compliant patients.
2. Increasing the amount of time spent with the doctor. Most studies show that an average office visit is less than 7/8 minutes, DPC visits are a minimum of 30 minutes and initial patient visits last over an hour.
3. Provide a plan design structure that promotes compliance; members will have labs, scans, images, and other “downstream” services at NO-COST when they engage and access services in specialized locations – better healthcare for less cost.
Adding the cost of DPC will lower overall costs and improve the experience for employees and their families.
If you raise the deductible and get employees to engage, they will be aware of the deductible raise but will not feel the hit of the increase.
This approach allows you to obtain “short-term” lower cost with a longer-term claims management and health improvement strategy in place which will lower cost, compounded, over the years to come.
Changing the way you structure the Rx program
Restructuring your Rx program will help your employees access brand and specialty drugs for FREE while saving 30%-50% of plan costs.
This topic hits home for us. THB creator Lester Morales’ dad was diagnosed with multiple myeloma when he was 15 years old and prescribed Revlimid.
The cost of this medication is $150,000/ year.
The drug caused his parents to reach their max out-of-pocket for several years in a row; this led them to file bankruptcy which changed his life forever.
If Lester’s parents’ Rx program used transparent PBM partners who utilize manufacturer assistance programs, his dad would have qualified to get the Revlimid for FREE and saved his employer $100,000+ per year. Unfortunately, his dad’s employer did not build the plan to have this benefit.
Why didn’t anyone say anything? Why did their insurance carrier not want to help?
The PBM industry DOESN’T want you to know, as this is how they make money.
Structuring your Rx program, where the higher-cost drugs have more OOP expense WHILE giving members an avenue to get these medications for FREE, is a WIN/WIN.
Conclusion
Albert Einstein’s definition of insanity says continuing to do the same thing and expecting different results is INSANE. Can we admit this is CRAZY?
If every renewal you are taking a $2,000 deductible and making it a $3,000 or taking a $25 copay and making it a $35 copay increasing the amount taken out of employees’ paychecks to lower healthcare costs.
If this sounds like your strategy and this has been your strategy for the last years…INSANITY might be setting in.
Increasing the cost might have been how you handled your employee health benefits in the past, but consumerism isn’t just about passing on additional cost; consumerism is about education, communication, and the right structure of a health benefits plan to promote employees, and their families, to become better healthcare consumers.
This month, we will explore three (3) strategies, in detail, that will make increasing OOP cost the start of a transformation.
Let’s retain employees and turn the increased cost into a positive solution for them and their families.
Follow our monthly topic, where we will walk you through turning to raise your deductibles into a BENEFIT.