Em­ploy­ers take the reins on health­care de­liv­ery

Frus­trated by high costs and leg­isla­tive un­cer­tainty, com­pa­nies are cut­ting out tra­di­tional car­ri­ers and tak­ing on em­ployee care them­selves.

Employee Benefit News - - Contents - BY NICK OTTO

Frus­trated by ris­ing costs and leg­isla­tive un­cer­tainty, com­pa­nies are cut­ting out tra­di­tional car­ri­ers and tak­ing on em­ployee care them­selves.

The health­care sys­tem is “about to com­bust.” That’s ac­cord­ing to Renya Spak, a part­ner at con­sult­ing firm Mercer, who ex­plained that’s be­cause leg­isla­tive com­plex­i­ties and un­pre­dictabil­ity — not to men­tion soar­ing health­care costs and in­ef­fec­tive care — are wreak­ing havoc on the sys­tem.

“If we put ev­ery­thing in a pot to­gether, voila, we have a sys­tem that is about to com­bust,” she said last month at the Ben­e­fits Fo­rum & Expo in New Or­leans.

To avoid that prob­lem, ex­perts ex­plained dur­ing a panel at the con­fer­ence, one group needs to step up: Em­ploy­ers.

“We’re pay­ing the lion’s share for the care of most Amer­i­cans in the U.S.,” said Milt Ez­zard, vice pres­i­dent of global ben­e­fits at Ac­tivi­sion Bl­iz­zard, the video game pub­lisher of Candy Crush and Call of Duty. “In or­der for that to work, em­ploy­ers need to band to­gether with each other and with good health car­ri­ers who can help lever­age what an em­ployer needs to have hap­pen.

“An em­ployer health-driven econ­omy means em­ploy­ers col­lec­tively bear the bur­den of health­care in our coun­try,” he said at the con­fer­ence, which was spon­sored by Em­ployee Ben­e­fit News and Em­ployee Ben­e­fit Ad­viser. Ez­zard is also one of EBN’s 2018 Benny Award re­cip­i­ents.

In fact, he said, “the bar for health­care is so low that there is so much [em­ploy­ers] can do to make a dif­fer­ence.”

For ex­am­ple, Ez­zard ex­plained that Ac­tivi­sion Bl­iz­zard used to part­ner with tra­di­tional car­ri­ers that of­fered con­ven­tional pro­grams with third-party ad­min­is­tra­tion tools to process claims. But en­gage­ment be­tween the in­sur­ers and em­ploy­ees was low, he said. In fact, within a year, the car­rier made only a to­tal of 17 “con­nec­tions” with Bl­iz­zard em­ploy­ees, and that, Ez­zard said, was a “huge fail­ure.”

As a re­sult, Ac­tivi­sion Bl­iz­zard quickly ter­mi­nated the con­tracts and started pick­ing in­di­vid­ual tech­nol­ogy so­lu­tions to man­age health con­di­tions in­clud­ing obe­sity and di­a­betes, which has paid off for the firm. “For a lot less money, we can get re­sources that tell us about en­gage­ment, like how of­ten [em­ploy­ees] go to the doc­tor.”

Em­ploy­ers need to stop wait­ing for the con­sul­tants and in­sur­ers and start driv­ing the im­prove­ments them­selves, added John Rankin, pres­i­dent of the North Carolina Busi­ness Group on Health, a trade as­so­ci­a­tion of em­ploy­ers in the state.

“As em­ploy­ers, large and small, we need to be will­ing to seek out that tech­nol­ogy and drive it without know­ing what that ROI is, without know­ing there is a re­turn on in­vest­ment,” he added.

But he cau­tioned that with the plethora of tech­nolo­gies and providers out there, it still is go­ing to be a chal­lenge to in­te­grate all the op­tions.

“The bar for health­care is so low that there is so much [em­ploy­ers] can do to make a dif­fer­ence.” Milt Ez­zard, vice pres­i­dent of global ben­e­fits, Ac­tivi­sion Bl­iz­zard

“What you’ve seen is em­ploy­ers try to do these Band-Aid so­lu­tions for dis­ease con­di­tions,” said Ra­jaie Bat­niji, co-founder and chief health of­fi­cer at Col­lec­tive Health. “It solves a prob­lem, but it cre­ates an­other. Now, in­stead of go­ing to one place, you might be go­ing to 25 places and have 25 pass­words. You’ve sud­denly cre­ated more com­plex­ity in your ben­e­fits plan.”

The rea­son em­ploy­ers are go­ing out and look­ing for these best-in- class plat­forms is that large car­ri­ers haven’t done a very good job of con­nect­ing with peo­ple, he said. “They haven’t made it a good job to nav­i­gate through care.”

Many em­ploy­ers are keep­ing their eyes on a num­ber of em­ployer-led ini­tia­tives, such as the still-un­fold­ing Ama­zon, Berk­shire Hath­away and JPMor­gan Chase health ven­ture.

Though Rankin said “none of us know what they’re go­ing to do,” Ama­zon has the po­ten­tial to re­move some of the mid­dle­men, and that’s why com­pa­nies like Cigna and Aetna are wor­ried.

“I think [Ama­zon] will work with their em­ploy­ees, along­side Berk­shire and JP Mor­gan, to get it right,” Rankin said. “That’s a good thing. What­ever they do will be a large-term ef­fort that will al­low them to roll that method­ol­ogy out to other em­ploy­ers.”

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