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11/18/2013

Employers: a partner in the health care ecosystem


by Bill Copeland, Vice Chairman, U.S. Life Sciences & Health Care Leader, Deloitte LLP

Employers have undergone significant efforts to be ready for and compliant with health care reform.As health care industry transformation continues, employers will increasingly be asking the question, “What can I do next to address the health of my employee population?” As employers look to control their health care costs, industry stakeholders—policymakers, government agencies, health care providers and plans—will be seen as valuable partners to help them make the greatest impact.

The Deloitte Center for Health Solutions2013 Survey of U.S. Employers highlighted several key themes that give insight into employers’ perspective on the performance of the U.S. health system, views on the Affordable Care Act (ACA), and tactics being considered or used by employers to implement benefits and health care cost-management strategies. So, what’s top of mind for employers?

  • Cost is the major concern: many employers believe the U.S. health care system underperforms and that major drivers of the cost issue are hospital costs, prescription drug costs, system wastefulness, defensive medicine, poor lifestyle choices, government regulation, and fraud.
  • Greater need for transparency and value: many employers believe that in order for the health care system to improve, they need more transparency into the system and better information. In their view, no one is providing this adequately.
  • A clear division over the Affordable Care Act (ACA): the survey found clear differences over employers’ opinions on health care reform. Three years in, many are not familiar with key features of the law and 53% view it as “a step in the wrong direction” toward reforming the health care system. Looking to 2019, around half predict that the ACA will achieve the goal of increasing access to insurance; far fewer (around one in five) think it will achieve the goals of reducing costs and improving quality of care. Based on these findings, my take is that employers don’t believe the ACA will help control cost or address any of their key issues, but instead will add more complexity and regulation without any clear benefit.
  • Cautious and watchful: there is a gap between tactics employers are currently using and tactics they consider to have “high impact” on managing or reducing health care costs. They’re sticking with what they’ve used for quite some time.

Employers play a significant role in the provision and financing of health insurance;their opinions about health care reform and experiences with the health care system matter. As employers’ decisions and intentions become clearer, other stakeholders may play a role in deliberations, specifically in the following areas:

  • Demonstrating value for money: policymakers, regulators, health care providers, and health plans all have the opportunity to improve transparency by enhancing the ability of employers to make comparisons and value-based decisions by focusing on outcomes, costs, and comparison to standards. Those who continue to focus on how to improve (and measure) the value of care provided and foster innovation in delivery system reforms will be seen as key partners.
  • Putting employees in the game: health plans and providers can assist employers as they shift their focus toward employee engagement and health improvement. Care management and wellness programs are likely to increase in importance to employers and health plans, especially in industries that compete for talent, as defined contribution program design becomes standard for companies.
  • Tracking the strategies—which work and which don’t: health care providers and health plans have the data and knowledge employers need to create strategies that can help improve overall employee health and well-being, drive healthy behavior, and reduce costs. And, as the use of incentives to help drive employee behavior becomes more prevalent, employers will need the right tools to track and evaluate their ROI of investing in prevention and wellness programs.

Stakeholders in the health care industry have the opportunity to partner with employers to help them deliver the value they need. Employers are demanding transparency to gain a better understanding of reform to help answer the question “what can we do next to impact the cost and quality of care?”

 

Bill Copeland, Vice Chairman, U.S. Life Sciences & Health Care Leader Bill Copeland Bill Copeland is the U.S. Life Sciences and Health Care Leader for Deloitte LLP and the sector leader of the practice's health plans group. Bill's near-term focus is helping companies and governments better address the direct challenges and extended ramifications caused by new developments with ICD-10, electronic health records, health insurance exchanges and accountable care organizations. He will also emphasize Deloitte's capabilities in more traditional business areas, including mergers and acquisitions, R&D, supply-chain management and employee benefits.

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