Researching various stories about health care, one of the most common sentiments I’ve seen regarding the current American system is the need for outcomes and lower costs.
Employers more than ever before are embracing value-based plan designs, which provide employees optimal care at lower costs, according to the 2016 Willis Towers Watson Best Practices in Health Care Employer Survey released this morning.
I spoke with Sarah Oliver, senior consultant and health care delivery leader for Willis Towers Watson, about how companies are going beyond just cost efficiency — now they’re seeking better results as well. The goal is to improve productivity and health for the employee and to help the employers themselves with their bottom line. She mentioned three areas of value-based plan design showcased in the survey.
First of all, a center of excellence, which focuses in some specialty field such as back, cardiac or infertility issues to name a few, is gaining traction.
Compared to 37 percent in 2015, 45 percent of the employers surveyed use centers of excellence for certain specialty services, according to the survey. Thirty-two percent were interested in using them by 2018.
One important consideration when implementing a center of excellence, said Oliver, is region. “We’re seeing a movement looking at strategies on a regional basis,” she said, rather than a one-size-fits-all approach where companies offer the same benefits and plan design without differentiation.
“Depending how big the population is, employers are looking for locations where they have a higher concentration of employers to make meaningful impact if they do implement a center of excellence,” she added. “All of this would be grounded in data and what the underlying issues are.”
Oliver gave an example of effectively implementing a center of excellence. Willis Towers Watson advised an energy company with a mostly rural, older, male employee base. To improve the overall health of employees, they looked at the data to understand the employees, and from there the company could create a strategy that addressed its workforce’s specific problems. The company partnered with someone who helped build a COE network, which included specialty areas of potential interest to the employees, like knee replacements and spinal surgery.
Employers are also more interested in implementing high-performance networks, the survey found. The percentage of employers offering these networks almost doubled since 2015 — from 11 percent to 20 percent.
The Affordable Care Act and some of the regulations have helped prompt a large “evolution from fee-for-service to fee-for-value” in provider contracting, said Oliver. “There’s a lot of activity in that space around network optimization and helping to construct a network of providers that are also higher quality.”
Whereas a center of excellence would focus on a specific medical problem, a high-performance network is more inclusive and provides a broader network which employees can use to drive cost efficacy and higher value.
Finally, 16 percent of employers are considering contacting service providers directly as a way to get improved pricing, according to the survey. Not many employers are currently doing this, but interest is on the rise.
A major challenge within any of these strategies is utilization, Oliver said. Employers need to focus on how they’re communicating these value-based designs to make sure employees know what they are and how to use them. Providing incentives for use may motivate employees.
If you’re a company transitioning from an old plan to one of these value-based strategies, a big success factor is positioning it as “here’s what’s in it for the employee,” said Oliver.
Education is key. Give employees proper decision support tools, to help them understand where they should be going for certain medical services and which places, for example, have lower mortality rates or readmissions.
Andie Burjek is a Workforce associate editor. Comment below, or email at firstname.lastname@example.org. Follow Workforce on Twitter at @workforcenews.