Employer Strategies to Improve Health and Healthcare Value · ARTHUR J. GALLAGHER & CO. | BUSINESS...

Employer Strategies to Improve Health and Healthcare ValueSUMMARY OF KEY FINDINGS© October 2015

ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™

Thank You!

You are receiving this summary because you participated in our survey on Employer Strategies to Improve Health and Healthcare Value. Employers are believed to be a key stakeholder and influencer on population health and the healthcare market. Your input helps us capture the employer mindset and your priorities, and understand the initiatives you’re pursuing to improve the health of your employees and your surrounding communities.

We hope you find this report valuable. Don’t hesitate to contact us with your questions and comments.

Thank You, The Benfield-Gallagher Team

2015 Benfield, a division of Gallagher Benefit Services, Inc. All Rights Reserved.


Contents

› Research Objectives› Research Participants› Key Research Topics

o Approaches to Managing Employee Healtho Employer Perspectives and Strategies: Healthcare Value (HCV)o Employer Perspectives and Strategies: Community Health (CH)

› Research Conclusions



Research Objectives

› Assess the status and trends related to employers’ health management strategies› Understand employer awareness of/participation in national and regional/local

initiatives focused on improving health and healthcare value› Gauge employer interest in:

o Learning more about initiatives, strategies, tactics and tools to help drive market-level healthcare value improvement

o Becoming trained to drive collaborative action at the market levelo Identifying peers who are interested and involved in market-level healthcare value

improvement initiatives



Employer Research Panel205 COMPLETED SURVEYS 11 INTERVIEWS

Jumbo Employers

(5,000+ Employees)

Mid-size Employers

(500 - 4,999)

Employer Participant SizeNumber of U.S. Employees

60%

40%

3%4%5%

8%10%10%10%11%

13%26%

Technology

Mining/Construction/Wholesale

State/Local Government

Education

Transportation/Communications/Utility

Retail

Finance

Healthcare

Service

Manufacturing

Industries Represented

20%

34%27%

7%7%

4%

Organizational Role of Respondents

VP/SVP HR/Benefits

HR/Benefits Director

HR/BenefitsManagerHR/BenefitsAnalysts/SpecialistCorporate MedicalDirectorOther

n=205 Employers


ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™ARTHUR J. GALLAGHER & CO. | BUSINESS WITHOUT BARRIERS™

APPROACHES TO MANAGING EMPLOYEE HEALTH



Health Plan Funding

© 2015 Benfield, a division of Gallagher Benefit Service, Inc. All rights reserved. 7

91%

9%

Approach to Funding for Active Employee Health Plans

Self-insureFully-insure

n=205

Most (91%) employer respondents self-insure their health plans


Health Management Philosophy


7% 15%

78%

Provide financial protection forunforeseen costs, catastrophic

illness or accidents

Provide benefits for preventionand support employees trying to

manage health conditions

Proactively manage benefitsand programs to improve

employee health and productivity

Philosophy for Managing Employee Health

A majority of employers hold a core philosophy of proactively managing employee benefits, with the goal of improving health and productivity

n=205


National vs. Regional Health Management Strategies


n=205

42%

29% 29%

We focus exclusively on strategies thatcan be implemented for all our

employees nationally

We prefer national solutions but willpursue regional/local strategies when

needed

We focus substantially on identifying andpursuing regional/local strategies

Employer's Preference for National vs. Regional/Local Management Strategies

Most employers prefer national strategies, but a majority are engaged in regional/local strategies either occasionally or primarily


3%

2%

4%

3%

7%

7%

8%

8%

9%

15%

1%

4%

2%

1%

1%4%

3%

3%

4%

4%

5%

7%

7%

8%

8%

9%

19%

Active participant Active leadership

Employer Involvement on the National Stage


NBGH - National Business Group on Health (n=157)

WELCOA - The Wellness Council of America (n=153)

NBCH - National Business Coalition on Health (n=123)

HERO - Health Enhancement Research Organization (n=65)

Leapfrog Group (n=137)

Catalyst for Payment Reform (n=35)

Choosing Wisely (n=46)

IOM - Institute of Medicine (n=88)

HC13 - Health Care Incentives Improvement Institute (n=63)

Healthcare Transformation Task Force (n=24)

Consumer Purchaser Alliance (n=25)

Employer’s Level of Involvement with Organizations/Initiatives

Employers have limited involvement in national health organizations and initiatives


Adoption of Innovative Approaches


n=20523%

47%

31%

We wait until innovations have beenpopularized and proven before

adopting them

We typically don't want to be the firstmover, but we monitor innovative

approaches and are relatively quick toadopt those that make sense for us

We consider ourselves innovators with ahistory of inventing newer and better

solutions to health, healthcare cost andquality challenges

Employer’s Approach to Innovations in Managing Employee Health and Healthcare Value

About a third of employers view themselves to be innovators, while nearly half consider themselves fast followers in adopting innovative health management approaches


EMPLOYER PERSPECTIVES AND STRATEGIES: HEALTHCARE VALUE (HCV)



Improving Value in Health Management


55%

57%

77%

84%

85%Improve health and well-being (n=200)

Increase informed/wise use of healthcare services by employees (n=199)

Provide better care management for employees with the highest health needs/costs (n=177)

Drive employees toward CDHP plan options (n=134)

Increase utilization of Centers of Excellence for complex and costly treatments and procedures (n=151)

Most Critical Objectives for Improving Value in Health Management Strategy (percentage selecting as one of top five among objectives currently in place or planned)

Some HCV-related initiatives are among the most critical to employers in terms of improving value, while others are lower priority

Few employers rank use of narrow networks, patient-centered medical homes or ACOs as a top-5 most critical objective for improving value.


Performance-Based Payment Models


35%

47%

52%

54%

55%

Healthcare Provider Contracts with Shared Savings or Pay-for-Performance Provisions (have or will have provisions for payment adjustments by 2018)

Accountable Care Organizations (n=73)

Narrow networks based on differentiated quality/value (n=93)

Centers of Excellence for complex and costly treatments and procedures (n=96)

Care management services for employees with multiple complex chronic conditions (n=120)

Provision of healthcare services at worksite clinics (n=79)

Current/planned shared savings or pay-for-performance payment models are most common in arrangements with ACOs, narrow networks and COEs


Driving Use of New Payment Models


n=25

40%

48%

12%

We are responding to newpayment models being made

available by our carrier(s)

We are encouraging ourcarriers to develop andimplement new models

We are demanding our carriersoffer new payment models as acondition of our doing business

with them

Employers’ Actions Regarding New Payment Models (among employers currently “driving transition away from fee-for-

service models”)

A majority of the employers focused on new payment models are playing an active role in driving them; About 60% are either encouraging or demanding their carriers/TPAs to develop and implement new payment models


Employer Engagement with Healthcare Providers


n=205

40%

18%21% 20%

We have not engagedin such discussions.

We have haddiscussions aboutchallenges only.

We have hadsubstantive

discussions aboutchallenges and

solutions.

We are currentlyworking with healthcareproviders on solutions.

Engagement in Discussions with Healthcare Providers About Local Healthcare Cost and Quality Issues

A majority of employers are engaging directly with healthcare providers; about 40% have had substantive discussions about solutions, and half of those are currently working with providers on solutions


Employer Contracting with Healthcare Providers


9%

12%

25%

31%

36%

26%

33%

22%

7%

23%

Currently in place (2015) Expected to contract (by 2018)

Services for Which Employer Contracts with Healthcare Provider (directly or through an alternative intermediary—not through their carrier/TPA)

n=205

Care management services for employees with multiple complex chronic conditions

Provision of healthcare services at worksite clinics

Centers of Excellence for complex and costly treatments and procedures

Narrow networks based on differentiated quality/value

Accountable Care Organizations

Employers increasingly expect to contract with providers for selected services: care management services is the most common choice currently, but many expect significant expansion of contracting for narrow networks and ACOs by 2018


Employer Involvement in Local HCV Initiatives


17%

18%

24%

28%

29%

33%Promote healthcare literacy and smart healthcare consumerism in the region

Develop consistent and transparent reporting of COST measures from healthcare providers

Develop consistent and transparent reporting of QUALITY measures from healthcare providers

Drive adoption of payment approaches that pay for value rather than volume

Assure healthcare information can be shared among providers in the region

Drive broad adoption of electronic healthcare information technology

Involvement in Initiatives in Any Key Workforce Location: Active Participant or Leader

n=205

At best, only 1/3 of employers are active participants or leaders (in at least one location) for any one type of HCV initiative

Not shown: Don’t know, No engagement, Supportive responses


EMPLOYER PERSPECTIVES AND STRATEGIES: COMMUNITY HEALTH (CH)



Employer Approach to Engaging in CH Initiatives


n=190

57%

22%17% 4%

Participation in communityhealth and well-beinginitiatives is left to the

discretion of leadershipin each major location,

no explicit concerns

We actively select andengage in communityhealth and well-being

improvement initiatives incommunities where we

believe there is a concern

There is an expectation forbusiness leaders in major

locations that theirorganization will participate

in community health andwell-being initiatives

Other*

Employer's Approach Toward Involvement in Community Health and Well-Being Improvement Initiatives

(among those supportive/active in at least one health issue)

*Other includes: Actively involved in local community in partnership with the Department of Health, both local/county and state level, Involvement is left up to the employees, None, We do not promote leadership involvement in community health and well being initiatives, We have dedicated units for community programs

Nearly 60% of employers leave the decision to engage in CH up to local management, while about 40% either actively select initiatives or set expectations for participation


Importance of CH to Employers


n=205

17%

37%

46%

Not important Moderately important Important

Importance of Health and Well-Being of the Overall Population Relative to Employer's Goals and Interests

Most employers (over 80%) believe community health is at least moderately important relative to the health of their employee population


Employer Involvement in CH Initiatives

3%

1%

5%

9%

9%

11%

14%

16%

15%

17%

2%

4%

6%

5%

6%

8%

9%

14%

17%

20%

Other*

Teen pregnancy

Homelessness

Hunger

Health disparities

Disabilities

Behavioral health

Cancer

Obesity

Chronic illness

Recreation and fitness

Active participant Active leadership

n=205

Employer Involvement in Community Health Initiatives

*Other includes: Employee wellness, National Obesity Initiative, healthy campus initiative, student wellnessNot shown: Don’t know, No engagement, Supportive responses

A moderate share of employers (19% to 37%) are active participants or leaders for the most popular types of initiatives

1%

22


26%

31%

46%

74%

Reasons Employers are Interested in Investing in Efforts to Improve Community Health and Well-being

(among those supportive/active in at least one health issue)

Employer Reasons for Engaging in CH


n=190

We want the culture in which our employees live to be a healthy one

We consider it part of our corporate social responsibility

A healthier community is more competitive economically

We want to improve the health of our local labor pool

Active employers engage in CH initiatives to promote a healthy environment for their employees. Corporate social responsibility is another important driver of participation, and some interviewees also identified the positive impact on corporate branding that attracts desirable employees


Barriers to Employer Engagement

© 2015 Benfield, a division of Gallagher Benefit Service, Inc. All rights reserved.

n=205

13%

16%

17%

32%

39%

60%

67%

Challenges to Participating in National or Market-Level Initiatives(employers were asked to select up to 3 factors)

We do not have organizational capacity or resources to engage in market-level healthcare initiatives

We do not have organizational capacity or resources to engage in national healthcare initiatives

We are not a large enough purchaser to impact the market(s) where we operate

It is too difficult to achieve meaningful progress when multiple stakeholders are involved

We find it difficult to identify initiatives that we want to support

We do not have enough expertise in healthcare to contribute effectively

We don't think benefits from such initiatives are worth the effort

Most employers believe that the main barrier to engagement in HCV and CH is organizational capacity or resources—not a lack of expertise or importance. Many employers (especially mid-size) also believe that they are not large enough to exert market influence

24


RESEARCH CONCLUSIONS



Research Conclusions

› There is a reasonably strong foundation of employer interest and engagement in HCV and CH

› More than 2 out of 5 employers are already active in either HCV initiatives (44%) or CH initiatives (41%)—and most of these are active in both kinds of initiatives

› Most employers have a preference for national initiatives, but many are willing to engage in regional/local markets where they have a substantial presence

› Most employers believe that it is moderately-to-very important for employers to engage in HCV initiatives and CH initiatives

› Employers are increasingly adopting health management approaches that align with HCV, including value-based purchasing strategies and direct engagement with healthcare providers



Research Conclusions (cont.)

› Employers tend to engage in regional/local CH initiatives that address health conditions impacting their employee populations

› Most employers are not aware of national employer health initiatives beyond a few large membership organizations, and active participation is limited to a small share of employers

› Employers face barriers to market-level engagement—chiefly the perception that they lack the organizational capacity/resources—but employers with strong, “disruptive” leaders have overcome these barriers



Thank You!

We value your insights and hope that you will continue to support our research efforts! Again, do not hesitate to contact us with your questions and comments.

Contact us:Jack NightingaleVice President(703) [email protected]

Sarah DaleyResearch Director(314) 968-0011 x [email protected]


mailto:[email protected]

mailto:[email protected]

Employer Strategies to Improve Health and Healthcare Value · ARTHUR J. GALLAGHER & CO. | BUSINESS...

Documents

Transcript of Employer Strategies to Improve Health and Healthcare Value · ARTHUR J. GALLAGHER & CO. | BUSINESS...