Prepare Your Company for the Future of Healthcare Today

by Jim Taylor | Mar 12, 2019 | Employee Benefits

The healthcare industry is changing at a rapid pace, and it can be hard to keep up as an employer in order to minimize costs and maximize the well-being of your employees. That’s why it’s worth considering where healthcare is likely to go and what steps you can take today to set yourself up for success in the future.

Let’s examine how the healthcare industry is changing and key ways to prepare your company for the future of healthcare:

• Become a better healthcare consumer
• Adopt telemedicine
• Empower and engage employees
• Embrace wellness

Healthcare: Where it is Now and Where it is Heading

The entire healthcare industry, and insurance in particular, has changed drastically over the past two decades. Consolidation, rising costs, technology, and government action have all contributed to a turbulent and challenging healthcare marketplace for employers.

At the beginning of the millennium, comprehensive insurance plans with low deductibles were still commonplace, but they ultimately failed due to the lack of an incentive for employees to reduce spending – which was especially vital after the recession. Insurance companies tried to solve the issue through carrier-managed plans which controlled access to care to reduce costs, but these plans proved extremely unpopular. As a result, carriers and employers are turning to consumer-driven health plans (CDHPs) to increase cost-sharing and decrease spending. The most common type of CDHPs are high-deductible plans paired with tax-deductible health savings accounts, which keep premiums low and give employees significant control over their healthcare costs.

The problem with these plans is that, while they provide employees with an incentive to manage and reduce their costs, the plans do not provide them with the tools they need to do so effectively. The rest of the healthcare pipeline, including employers, are struggling to catch up with ways to reduce costs and empower employees now that more of the healthcare costs lie on the consumer.

Throughout the healthcare industry, the focus is on cutting costs and increasing efficiency – resulting in the formation of conglomerates. The lines between insurance carriers, brokers, pharmacy benefit managers, pharmacies, and providers are all becoming more blurred. The most prominent recent mergers have been between insurers and PBMs; Aetna recently merged with CVS Health and Cigna purchased Express Scripts.

There is good reason to believe that this trend of consolidation will continue, and that major companies not historically associated with healthcare will get involved. Amazon has made it clear that it intends to enter the healthcare arena, partnering with reinsurers Berkshire Hathaway and JPMorgan and purchasing the prescription delivery service PillPack. As with so many other industries, Amazon is likely to change the way that the healthcare industry functions and take over a lion’s share of the market in the process. And once it has, it is likely that other tech giants will follow suit.

The current trend of consolidation and CDHPs are moving the industry towards a “direct-to-consumer” model, with fewer middlemen and greater focus on customer experience. There will be more opportunities for employees and employers to save time and money, but at the same time there will be an even greater burden of responsibility to be intelligent consumers. The more knowable the market is for consumers, and the more control that they have over their healthcare, the more important it is that understand it. Education, already a crucial and too-often-neglected part of the healthcare equation, will likely become even more vital to both employers and employees.

Employers have often borne the brunt of the burden of rising costs and an ever-changing healthcare industry. Future changes could cause further turmoil for companies that do not adapt quickly and effectively. However, change is not always bad news at all. You can set yourself up for success in the current and future healthcare markets by taking a proactive approach to your healthcare policies and adapting properly to every new development. The future is looking pretty bright – for smart healthcare consumers.

Become a Better Healthcare Consumer

In order to thrive now and in the future, it’s important to become a better consumer. The same trends that have empowered employees to take control of their own healthcare costs have also given employers greater responsibility for their own costs. So how can you meet this responsibility?

Education is the first step to becoming a smarter consumer. Knowing the ins and outs of the market, including which new options exist and could benefit the company and its employees, allows you to take control over your healthcare present and future. This is especially important when the relationships between every player in the healthcare industry are being thrown into turmoil. Proactive employers, armed with current knowledge, can negotiate better deals and carve out an advantageous space for themselves in the new market that is continuously forming.

An important part of becoming a better healthcare consumer is to take advantage all of the new tools that are becoming available that employers can leverage to minimize their expenses and provide value for their employees. For instance, mail-order prescriptions and other alternatives to traditional pharmacies can reduce your spend on prescription drugs. Modernized, alternative healthcare fulfillment will only become more common, so adopting them early will set you up to take full advantage of new developments.

Adopt Telemedicine

Telemedicine is perhaps the most significant alternative to traditional care that employers can leverage to reduce their costs while keeping employees healthier. In an age when offices are increasingly moving in the direction of remote work, remote doctor’s appointments just make sense. Plus, telemedicine is likely to become even more widespread and powerful, so making it part of your employee’s healthcare habits now will pay dividends in the long-term.

Like all other digital healthcare solutions, telemedicine saves employees – and by extension employers – time and money by offering a more convenient alternative to traditional options. It lowers direct costs by reducing the number of expensive emergency room and urgent care visits and is often even cheaper than a traditional doctor’s appointment. Also, employees commonly skip or reschedule preventative care appointments during work hours because they feel pressured not to miss work, which can actually lead to greater healthcare costs down the line (not to mention make employees feel mistreated).

Telemedicine also makes your team members better employees. Because employees can consult doctors from their home or office, they generally don’t need to miss work in order to get medical advice. And, because telemedicine allows employees to access the care they need more quickly, your employees will be healthier overall, raising their productivity when they are in the office.

Empower and Engage Employees

At Launchways, we strongly believe in empowering your employees to become smarter healthcare consumers. This is particularly important in healthcare because of the shift towards consumer-driven health plans. With the current trend of consumer-driven healthcare, employees need to be more involved in their healthcare decisions in order to minimize costs while maximizing their health. So, turning your employees into smart, proactive healthcare consumers can really set you up for present and future success.

Coaching and education are important parts of empowering employees, allowing them to choose the options that are best for their health and their wallets. Digital tools not only provide employees with the information they need to be smart consumers, they also make it easier to navigate the healthcare process – an important step in getting employees engaged in healthcare decisions. And engaged consumers spend a third as much on healthcare as passive consumers, according to the 2016 McKinsey Consumer Health Insights Survey. The same survey also found that 80% of consumers view digital solutions as the most effective way to perform many fundamental healthcare activities such as finding doctors and insurance plans, checking health information, and monitoring health metrics.

Because employees prefer digital options, they are more likely to take control of their healthcare decisions when offered digital solutions. And since digital options are streamlined and user-friendly, they genuinely make it easier for consumers to save money and manage costs through intentional consumption. Tools like HealthiestYou are already providing employees with one-stop-shop digital platforms to manage their healthcare. Just as Uber has revolutionized transportation and apps have modernized dating, healthcare apps make it easy for consumers to find the insurance plans, doctors, medications, and pharmacies that work best for their health and wallet.

Embrace Wellness

Wellness benefits are getting increasing attention due to their ability to reduce healthcare costs and make employees feel valued and engaged in their work. The cost-benefit analysis of wellness from a healthcare perspective is clear – the healthier your employees are, the fewer healthcare-related costs they will incur. Smoking cessation and weight loss programs are obvious examples of cost-saving wellness measures, but other health-promoting benefits can have almost as big an impact on your bottom line.

Because wellness benefits generally target lifestyle related health costs, they are often seen by employees as quality-of-life benefits. They show employees that you care about their wellbeing, which makes them feel valued. Given the challenges of high employee turnover and the difficulty of keeping employees engaged in their work, the morale boost from introducing wellness benefits can be a very welcome side effect indeed.

So wellness is important, but what exactly are wellness benefits? The first kind of wellness benefits have to do with physical well-being, such as:
• Onsite gyms
• Discounted or free gym memberships
• Company-wide exercise or smoking cessation challenges
• Nutritional benefits: eg. healthy meals and snacks on-site or access to a nutritionist

The second type of wellness benefits address mental health, which is an often overlooked area that can result in significant healthcare costs as well as reduced performance. Examples of these benefits include:
• Time off to recharge: vacation time, sick days, “personal days”, floating holidays, summer Fridays
• Stress relief breaks: naps, required breaks throughout the day, or even on-site massages
• Meditation or mindfulness apps
• Support groups (particularly for alcohol or smoking cessation)
• Onsite or remote counseling

Wellness benefits can have a significant impact on your healthcare costs as well as your employee’s well-being and work satisfaction as a whole. If you’re interested in learning more about wellness programs and what they can do to empower your organization, keep an eye out for our upcoming article on the topic.

Key Takeaways

The healthcare industry has changed a lot in recent years, and there is every reason to believe that it will keep changing at an even greater rate. Employers have to adapt to face new challenges and accommodate new healthcare models in order to keep afloat. But by planning ahead and taking advantage of new developments, employers can define their role in the healthcare equation, minimize their costs, and maximize their employee’s health and well-being. Just keep in mind that a few key steps can help you manage costs now and prepare for the future:

• Becoming a better consumer by educating yourself, renegotiating relationships, and leveraging new tools
• Adopting telemedicine to reduce direct costs and absenteeism and to increase productivity
• Empowering and engaging employees to make them the best possible healthcare consumers
• Embracing wellness to reduce long-term health costs and make your employees feel valued

Healthcare is an incredibly complex topic and there is no right or wrong answer for how to manage your employee’s healthcare. Every organization will face its own challenges and find its own solutions. But, hopefully this article has provided some insight into where the industry is going and some of the things you should consider doing for the present and future well-being of your company and its employees.

How to Reduce Employer Spend on Prescription Drugs

by Jim Taylor | Mar 8, 2019 | Employee Benefits

Prescription drugs are a major driver of healthcare costs for individuals in general, and for employers specifically. Prices increase an average of 4% a year and specialty drugs, already the most expensive category, increase by 21% per year. Politicians across the political spectrum have put drug costs at the center of their healthcare rhetoric, but little action has actually been taken. In the meantime, prescription drugs have become the second greatest healthcare expense for companies and represent roughly a third of total healthcare costs for employers.

Luckily, there are several ways that employers can reduce their spend on prescription drugs, including:

• Educating Employees
• Empowering Employees
• Providing Employee Incentives
• Using Restrictions as a Last Resort
• Managing PBM Relationships

Educating Employees

The number one thing you can do to reduce prescription expenses is to make sure that your employees are well informed about their coverage, prescription options, and best practices. Education is free, for the most part, and will not only reduce costs but will also make employees feel better about their benefits packages. Many employees feel that their companies do not sufficiently explain their benefits and coverage, so they will appreciate any effort to provide them with more information.

Most importantly, educate your employees about best practices that will save themselves and, by extension, the company money. This includes telling them about preferred pharmacies, generic alternatives, mail-order services, and other cost-saving options. Healthcare costs are a major source of stress for employees as well as employers, so telling employees what they can do to cut costs will often be enough to cut your expenses significantly.

You should also make sure that your employees understand their coverage and the tools that are available to them. In the next few sections we will explore various structures and tools you can use to reduce costs. However, they will only be effective if employees use them, so education is still key.

Every communication regarding healthcare and reducing prescription drug costs should be framed in the context of the benefit to the employee. Hopefully all of the best practices and all of your policies will help your employees as well as the company – so make that the heart of your messaging. This can turn a potential morale crisis into a boost in employee engagement. Your employees will appreciate your efforts to give them the knowledge and tools they need to manage their healthcare and save themselves money – and may not even consider the possibility that you are also trying to save the company money.

Empowering Employees

While education is vital, it is often not enough. You need to provide your employees with tools and resources to help them keep the cost of care low. Best of all, these tools can be presented as new benefits, making your employees feel valued and appreciated.

An easy tool to implement is a prescription savings card such as Clever RX. Here at Launchways, we partner with Clever RX to help improve the benefits experience for our client’s employees. Clever RX cards offer increased savings at pharmacies and work in conjunction with most insurance. Users save up to 80% on prescription drug costs and generally pay less than most copays. More than two thirds of people can save money with a prescription savings card, especially during an era of rising deductibles.

In addition to giving your employees a prescription savings card, you can also offer them a comprehensive healthcare planning tool like HealthiestYou. Launchways partners with HealthiestYou to offer our client’s employees access to quality healthcare services at a fraction of the cost of traditional healthcare channels. Using HealthiestYou, employees can search for nearby pharmacies and in-network providers and easily compare the prices of copays/deductibles at each option to reduce costs. They also receive regular reminders about benefits and savings, and can review their coverage information at any time through the app, making your job of educating your employees that much easier. Perhaps the greatest benefit of HealthiestYou is their telemedicine platform. With telemedicine, employees have 24/7 access to teleconference appointments with board-certified doctors. With telemedicine, employees can receive prescriptions for common health concerns with a simple phone or video call. HealthiestYou and other apps can save your employees and your company time, money, and stress.

The last way to reduce healthcare costs across the board by empowering employees is to offer preventative benefits. If you encourage healthy employee lifestyles, you can avoid many costs from medical visits and prescription drugs. An Employee Assistance Program offers confidential third-party guidance to employees to reduce their stress, help them cope with their struggles, and hopefully keep them out of medical harm. More importantly, wellness programs can reduce “lifestyle diseases”, a major cause of medical costs in the US. Fitness competitions, standing desk options, and access to gyms or nutritionists either onsite or at a reduced cost can help keep your employees healthy and off of prescription medications.

Providing Employee Incentives

While restrictions should be avoided whenever possible, as we will explore in the next section, you can provide incentives to push employees towards prescription drug best practices. There are a few key incentives that are effective and not overly burdensome.

First, you can create additional tiers of insurance to enable employees opt-in for greater coverage. This can increase cost-sharing significantly, and offering increased care is an easy sell even if it is at a higher cost. In particular, consider creating a tier that covers specialty medications. Specialty drugs represent 38% of prescription costs but only 1-2% of total prescriptions, so focusing on them can often be the most effective way of reducing expenses.

Drug formularies offer another powerful incentive to keep the cost of prescriptions down. They are essentially lists of drugs that are eligible for increased coverage and available at lower cost to the employee. You can work with your insurance provider and pharmacy benefits manager to put together formularies that best meet the needs of your employees and your company. Formularies are effective because they do not reduce coverage so much as they encourage intelligent decisions by offering additional incentives for generics and other cost-effective drugs.

Using Restrictions as a Last Resort

Many common cost-cutting methods punish employees, shift costs from the employer to the employee, or reduce the level of care. When there are so many ways to reduce prescription drug expenses that actually benefit employees, restrictions should be avoided whenever possible as they can cause harm, or at least inconvenience, to employees and damage employee trust in your company.

Even the perception that you are cutting coverage can cause morale to plummet, driving poor performance and high turnover as employees look for a company that they believe will provide greater benefits. This is why it is important to emphasize the benefit to the employee throughout the healthcare conversation, and avoid policies that genuinely reduce coverage.

That being said, some restrictions are acceptable options to use as a last resort when you need to reduce costs significantly or the other methods have proven insufficient:

• Prior authorization before filling a prescription
• Mandatory mail-order for maintenance medications
• Medical justification for name-brand prescriptions over generic alternatives, or make employees cover the difference in cost between name brand and generics
• Step therapy: allow employees to access the drugs they need but require them to try more cost effective treatments before stepping up to more expensive drugs

Managing PBM Relationships

One of the most effective ways to cut prescription expenses is to work with a Pharmacy Benefit Management company, or a PBM. These organizations negotiate with pharmacies, drug companies, and health insurance providers to secure rebates for specific drugs and keep costs low for their clients.

Currently, 65% of companies use a PBM to reduce their healthcare costs. If you are not one of those companies, then you should look into how a PBM can save you money on prescription drugs. But if you already work with a PBM, you can increase your savings by putting your relationship under the microscope.

The first thing to keep in mind is that you should never sign a long contract with a given PBM and you should retain the right to renegotiate the contract at any time. This keeps them on their toes and ensures that they will continue to work to get you new savings. It also empowers you to take matters into your own hands to correct any abuse by the PBM.

Once you have secured the ability to monitor and correct PBM behavior, you need to actively manage your relationship. Examine your contracts regularly and renegotiate whenever possible to make sure that the needs of your company and your employees are being met in a cost effective manner. Also, do not be afraid to research current trends and price compare with other PBMs to make sure that your relationship still makes financial sense.

Key Takeaways

We have covered a lot of cost-cutting strategies in this article, so here are the key things you can do to reduce your prescription drug spend:

• Prioritize employee education around your benefits offerings
• Inform your employees of best practices and coverage specifics
• Empower your employees to save themselves time and money with tools like Clever RX, Healthiest You, and lifestyle benefits
• Encourage your employees to follow best practices with new insurance tiers and drug formularies
• Use restrictions as a last resort, because while they can be effective you risk alienating employees
• Partner with PBMs to reduce costs, but consistently manage your PBM relationship to maximize the benefit to your employees and your bottom line
• Work with an employee benefits broker that helps you build and implement a strategy to control prescription drug costs

In an age of rising drug prices, and higher co-pays and deductibles, many employers are cutting coverage to manage their costs. But the reality is that you can effectively reduce costs while helping your employees receive the highest level of healthcare.

Still Suffering From Open Enrollment Burnout? How to Avoid Headaches Next Year

by Jim Taylor | Feb 22, 2019 | Employee Benefits

Another open enrollment period has come and gone. Hopefully this stressful time of year went smoothly for your HR department and for your employees, but chances are your team is frazzled and your employees still have questions about the plans they signed up for. No matter how well you handled open enrollment, there are probably steps you can take to make things go better next year.

Why is it so important to get open enrollment right? Well, according to Aflac surveys, 80% of employees believe that their benefits package influences their engagement in their jobs and with their companies. Moreover, a majority of employees surveyed said that they were likely to accept a job with lower compensation but better benefits. Therefore, it is vital that you make sure that employees have access to their benefits, are fully informed about the range of benefits available to them, and feel positive about every part of the benefits enrollment process.

So how can you make next year’s open enrollment period more satisfying and less painful for everyone involved? All the answers you need are in the open enrollment period you just survived. Take a hard look at the past enrollment period to figure out what went well, what didn’t go so well, and what you can do to handle open enrollment more effectively next year.

In today’s post we will examine the key components of a successful open enrollment analysis, plus share a few best practices every team could benefit from:

• Collecting Data
• Identifying Trends
• Analyzing Behaviors
• Creating Actionable Next Steps
• Common Best Practices

Collect Data

The first step to figuring out what to do next year is finding out exactly what happened this year. Hopefully you collected useful information during open enrollment, such as employee enrollment rates or the number of emails, meetings, one-on-one sessions, and calls between employees and internal stakeholders regarding the benefits options. What’s important to do now that the enrollment period is over, though, is to find out what employees and internal stakeholders thought of the process in order to identify pain points and preferences.

Some of the most important insights into your open enrollment procedures can come from soliciting feedback from employees. The best way to do this is to send surveys out to all employees who participated in open enrollment. Here are some key things to ask employees about in the surveys:

• Ease of enrollment
• Accessibility of information about benefit options
• Perceived quality of benefit options
• Areas for improvement
• Preferred methods for enrollment and communication

In addition to talking to employees, you should also make sure to send surveys to your internal stakeholders – namely managers and members of the HR department – to see how open enrollment went for them. Be sure to include questions about:

• Success meeting enrollment goals
• Processes that went well
• Issues that arose
• Suggested procedures for next year
• Ways to make their job easier during open enrollment

Identify Trends

Once you have collected enough data, it is time to analyze it to draw inferences that will allow you to plan for next year. You should look for trends in survey responses that indicate either successes or challenges during the enrollment period.

Some common trends that you may encounter in employee surveys that you should take seriously include:

• Confusion regarding benefit details
• Dissatisfaction with benefit options
• Frustration with the enrollment process itself

Things to look out for in your survey responses from internal stakeholders are:

• Answering the same questions over and over
• Not knowing who to direct employees to for further information
• Difficulty tracking enrollment/other systems issues

Analyze Behaviors and Processes

Behind each trend is a behavior or set of behaviors that drove the end result for your employees or stakeholders. In many cases the good or bad behaviors and processes will become evident as soon as you identify the trends, others may require further interviews with troubled survey respondents to identify.

The same trends can also have different behaviors behind them that will become clear upon further investigation. Take, for instance, the example of employee dissatisfaction with benefit options. You have a serious issue when a lot of employees are not happy with the benefits offered to them, since benefits are key to employee performance and retention. In some cases, your benefits package may need to be reviewed and expanded. Most of the time, however, employees’ dissatisfaction stems from not being clearly informed of the full range of options available to them. Taking the time to explain the options and how they provide for employee needs can nip this issue in the bud.

General categories of behaviors and processes to examine in explaining each trend include:

• Distribution of benefit option information
• Communication structures and behaviors
• Availability of resources for employees, managers, and the human resources team
• Enrollment process – did employees enroll on paper or online?
• Enrollment tracking

Create Actionable Next Steps

For each behavior that you identify in the previous step, you should create actionable next steps to improve the enrollment process next year. Think about how you can prevent the issues that came up this year, what new practices you can establish to make the process easier, and how you can preserve existing positive behaviors so that they do not get lost over time.

You shouldn’t put off implementing new best practices until next enrollment period. Make a game plan for how you can prepare for open enrollment over the course of the entire year. Set quarterly and monthly goals and keep yourself, and your team, accountable to that schedule.

Let’s continue the trend/behavior example from the previous section and look at some actionable next steps you can take to address employee dissatisfaction with benefit options. The first step you can take is to follow-up with survey respondents to find out exactly what they thought was lacking in the benefits package. If it turns out that the options actually include many of the things that they want, then you know you have a communications issue. So, create a plan for how you can address the issue over the time from now until open enrollment closes. This might include a monthly newsletter featuring benefits options, establishing one-on-one meetings with each employee to determine their needs and find the plans that meet those needs, or creating a new benefits handbook.

Common Best Practices

Each company’s challenges are unique, but there are some things that most people can do to make open enrollment as productive and pain-free as possible.

Get Employees Ready in Advance

Take the opportunity to highlight your benefits package and boost employee engagement by providing clear and positive information about benefits options. Create easy to digest reference materials, make the HR team and insurance brokers as accessible to employees as possible, and hold open meetings explaining benefits year-round. Also, make sure that your managers have the information they will need well ahead of time, because their team members will come to them with questions as soon as open enrollment starts.

Establish Effective Processes

Track as many metrics as possible in real-time during open enrollment next year, so that you can correct issues immediately and minimize post-enrollment follow-up. You should examine your benefits processes every year, but try to make your job easier next year so that you do not have to do as much data collection.

Also, set up clear communication procedures and do not deviate from them. That way employees know where and how to get more information about their benefits options and you can avoid costly mixed messages and wasted time.

Make Compliance Easy

Keep your team members happy by making ACA compliance as painless as possible. The best way to do this is to take a look at how you document coverage offers. If you don’t have a standardized, streamlined, and electronic way of tracking coverage offers, it’s time to investigate different software options. Record keeping is a pain, there is no reason to make your team’s job harder. Also, make a plan for when you are going to send employees information necessary for compliance, such as the Summary of Benefits and Coverage and the Uniform Glossary. The more formalized the process is, the less likely you are to let something slip through the cracks.

Communicate Year Round

Even if you have your open enrollment procedures down, there are probably things you could do year round to make your lives easier come enrollment time and provide employees with more information, more regularly.

The best way to do this is to send a benefits newsletter every month or quarter, or to regular email updates on benefit options and policy changes. This way, employees will have access to more information when the time comes to choose their benefits, without being overloaded with information all at once. The sad truth is that the majority of employees spend less than an hour reading about available plans and choosing their benefits. So, giving them information in more manageable pieces throughout the year can help prepare them more effectively than providing more information than they will use at the start of open enrollment.

Sending regular updates can also make your internal stakeholders’ jobs easier too. It can be hard to record all of the policy changes that occurred over the past year; newsletters give you a reason to record the changes over the course of the year rather than all at once when open enrollment is approaching. The newsletters or emails will also become valuable resources for your team to direct employees to in order to answer common questions.

Key Takeaways

In this post we have explored how to analyze your processes to make sure open enrollment gives you less of a headache next year. Some key takeaways include:

• Track data during open enrollment and collect information from employees using surveys
• Identify issues and successes from last year
• Figure out the behaviors and processes behind the trends
• Create a plan for next year to correct the bad and improve on the good

What practices has your company implemented to make open enrollment easier and more successful? Share your tips in the comments below.