There’s a Great Re-evaluation going on among your peers when it comes to health and well-being program benefits.
During the pandemic, many employers made strategic benefits moves to support the rising demands and unique needs of their workforce. But since then, new business challenges have emerged, such as inflation, rising healthcare costs (the average amounts that employers will pay for health care this year will be 8.5% higher than last year, according to Aon), and the greater availability of pricey specialty drugs.
When the audience attending a webinar presented by BenefitsPro was asked in a poll question what the primary driver is for the current re-evaluation of their company’s health and well-being programs, here’s what they said:
- Cost management (34%)
- Lack of improved employee health outcomes (30%)
- Declining employee engagement (27%)
- Vendor dissatisfaction (6%), and
- Other (3%).
Analyze health and well-being program costs
Step one of the Great Re-evaluation is identifying exactly what’s driving the costs of your health and well-being program.
What does the demographic makeup of your workforce look like (for example, are your Boomers staying or retiring)? Do they require higher-cost, condition-specific care for cancer, cardiovascular disease, diabetes, musculoskeletal disorders or mental health conditions? Is anyone using those notoriously expensive GLP-1 medications for diabetes management that many people are also using to lose weight?
“You still have to address all of these services. But then maybe we start to micro-segment by generation,” Regina Ihrke, the health, equity and well-being leader for North America at WTW, said during the webinar. “It depends on the average age of your population if maternity is on or off the list of high-cost claims.”
Are there any healthcare services that are being overutilized and driving up the costs? Are preventive care services being underutilized, which tends to lead to more costly care down the road?
Kristen Grady, the health transformation team vice president for Aon, commented that putting a health and well-being program in place and hoping for the best is the wrong approach for employers prioritizing cost management.
“The good news is that there’s a … controllable component to all of this. … From what we’ve seen in the data, there hasn’t been a rebound [in] preventive screening rates from the pandemic that we would have hoped to have seen by now. … How much of that spend … is in cancers that have preventive screenings that are recommended? How can we dig in there and encourage people to get those screenings earlier, so [providers are] catching cancers sooner and controlling that cost as much as you can?” she said.
According to Ihrke, hospital and health system contracts will lead to “significant increases” in the cost of services over the next two years. “The hospital systems are still recovering from the financial distress of COVID. … If you ask any carrier, they would say they expect hospital contracting to be at least a 20% increase,” she said.
Employers need to be asking, “How do I continue to steer [employees] to the appropriate [care], either through high performing networks [or] Centers of Excellence. … Also, how do we continue to leverage … virtual care?”
Get relevant data from your vendors
To answer most of the previously mentioned cost management questions, you’ll need data from your health and well-being program team. This includes hard data, like claims, and soft data, like employee surveys.
Your carrier has data that measures the impact of care, shows what’s working and what isn’t, and provides indicators for how utilization of services may be changing. For instance, wouldn’t you want to be financially prepared if a lot of employees were being prescribed GLP-1s?
“One of the pieces that we don’t see as much, interestingly enough, is … utilization of [pharmacy benefit management] data,” said Ihrke.
Grady recommended using time-based metrics – every 12 months, 18 months and three years – to track the ROI of your health and well-being program.
“You create a measurement strategy, documenting this partner was put in to target this population and fill this need. Reminding yourself of that, I think, can be just really valuable … creating the specific metrics for those specific partners,” she said.
Analyze engagement with your program
“With rising costs, employers are doubling down on engagement” with their health and well-being program, said Bria Gali, vice president of alliances and consultant relations for MOBE.
The key drivers of employee utilization are:
- Awareness of what the program offers
- Accessibility to care
- Personal needs and interests, and
- The employee experience (they feel like they’re getting something out of it).
Grady commented that program engagement has a lot to do with company culture. “Employees can have things that they really want to use, or think would make a big impact in their health or their behaviors, but if the culture of the organization doesn’t support engaging in those solutions in a way that makes sense for employees, then nobody’s going to use them,” she said.
So what’s your strategy for responding to employee health and well-being needs and preferences? For example, do you have employees with young children or who are caring for elderly parents?
Coming up with a strategy will likely require collaboration with your HR and Benefits people, who are skilled at asking for feedback from your company employee resource groups/business resource groups and compiling surveys that measure employee sentiment.