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This questionnaire is designed to help employers identify their healthcare priorities when formulating an overall health strategy. Every employer and its covered workforce has unique challenges, and a “best practice” for one organization may be inappropriate for another. Factors such as workforce composition, turnover, and business and operating model all play a role in formulating an effective healthcare strategy.
We have found that most employers fall into one of three general strategy categories as purchasers of health benefits:
- Cost Managers
- Value Drivers
- Health Advocates
Answering the following seven questions can help you determine what kind of healthcare purchaser you are and the strategies that will work best for you.
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Competitive Advantage
- Focused on building a world class workforce to achieve competitive advantage
- Attract/retain the best and brightest
- Ensure health and productivity of mission critical employees
Necessity
- Required by law
- Stay competitive with other employers
- Reduce turnover
- Improve productivity caused by poor employee health
Employee Investment
- Want to save money, but employee retention and productivity are equally important
- Can tolerate short term cost increases that may lead to greater savings in the long run
Cost Reduction
- Failure to halt healthcare spending imperils our short term financial objectives
Below National Average
- Benefit spending trends are under control, and we want to keep them that way
Above National Average
- Our benefit trends have been unacceptably high. We look for a dramatic change in healthcare cost trend
Strategic
- Primary value delivered by high performance teams and individual contributors
- Loss of the wrong employee imperils business goals
- High revenue / margin per employee
Commodity
- Primary services delivered by an hourly workforce
- Relatively low cost to replace individual employees
- Low revenue / margin per employee
High Retention
- Stable workforce
- Long term employees
High Turnover
- Significant turnover of key covered population
Well
- Younger population, lower incidence of disease
- High education and income levels
Poor Health
- High incidence of chronic diseases like diabetes, heart disease and COPD
- High incidence of smoking and obesity
- Lower income and education levels
- Comprehensive coverage
- More in-network provider option
- Value-added member services
Affordability
- Affordable low monthly premiums
- Catastrophic coverag
Strategy Elements:
Objective
Create competitive advantage by creating a culture of health that maximizes workforce
performance
Overall Strategy
- Early establishment of integrated health metrics
- Early introduction of a $0 balance HRA as a vehicle for health incentives to accompany current plan designs
- Introduction of high deductible health plan in year 3 or 4 of strategy
- Investment in Total Population Health Management from an integrated provider
- Combination of behavioral and market based financial incentives
- Corporate branded, 3-5 year health outreach program to cover all aspects of consumer healthcare
Plan Design
- $0 balance HRA to accompany existing health plans
- Gradual migration to medium deductible HRA plan over 3 years
- Broad definition of preventive healthcare, and provisions for treatment of mental health
- High deductible health plan with funded HSA offered as an alternative for executives
Type of Spending Account Used
- Primarily HRA/FSA but may include an HSA option with an employer contribution
- Unusual: HRA/HSA combination (Example: The HSA covers the first $1,000 and is employee-only contribution; the HRA covers amounts above the $1,000 deductible)
Incentives
- Behavioral incentives for actions:
- - Health Risk Assessment
- - Participation in Disease Management
- - Health fair/lab tests
- - Achievement of specific wellness outcomes
- Positive market incentives
- - HSA contribution or HRA with retirement or post termination value
Care Management Framework
- Health Risk Assessment and on-site lab screening
- Personalized health report
- Total Population Health Management
- - Health Portal with ability to customize content by condition
- - Employee health record
- - Input from third parties
- - Supports HIPAA compliant personal messaging
- - Full spectrum Disease Management
- - Case Management
- Extensive health & wellness including on-site exercise and clinical facilities
Advocacy and Decision Support Tools
- 24-hour nurse line
- May include 2nd opinion services
- On-line price/quality tools
- May include personal health bill audit service
Program Sequence
- Total Population Health Management and implementation of integrated health metrics
- Communications blitz focused on personal health
- Introduction of $0 balance account and incentives
- Partial replacement high deductible
- Full replacement to high deductible
- Offer choice of HRA or HSA
For more information call 888-421-7477. Carewise Health is marketed by SHPS, Inc., a provider of integrated health solutions. © 2008 SHPS, Inc.
Strategy Elements:
Objective
Obtain immediate reductions in health costs
Overall Strategy
- Immediate shift to high deductible health plan
- Emphasis on financials of plan design, management of eligibility
- Care management programs with same year payback
- Strong behavioral focus and financial penalties for non-participation in health programs
Plan Design
- Limited plan options
- Restrictive high deductible health plan with an HRA or an unfunded HSA (extreme case)
- Deductible gaps of $1,000 or greater (individual coverage)
- High out-of-network co-insurance
- Aggressive formulary incents generics, mail order and in-network purchase of specialty drugs
- May cap out-of-pocket maximums
Type of Spending Account Used
- Restricted HRA (rollover limits, forfeiture at termination, health coverage only)
- HRA deduction first, then FSA; or
- (Extreme case) Un-funded HSA, option for limited FSA
Incentives
- Aggressive incentives for outcomes:
- - Body Mass Index
- - Non-smoker
- - Blood Pressure
- - Premium reduction or employer contributions to HRA
- - Failure to comply with protocols costly
Care Management Framework
- Targeted Case and Disease Management for population specific and catastrophic conditions
- Generic on-line health and wellness
- Services may be bundled into the health plan
Advocacy and Decision Support Tools
- 24-hour nurse line
- On-line price/quality tool
Program Sequence
- Full replacement high deductible health plan in year 1 or 2, along with decision tools
- Disease / Case may be introduced with or subsequent to high deductible health plan
- Incentives focus on HRA and mandatory on-site lab screening in year 1
- Additional incentives added for Disease Management compliance in year 2 or 3
For more information call 888-421-7477. Carewise Health is marketed by SHPS, Inc., a provider of integrated health solutions. © 2008 SHPS, Inc.
Strategy Elements:
Objective
Obtain short term reductions in healthcare cost, balanced with targeted investments to improve long term health outcomes and reduce cost trends over 3-5 years
Overall Strategy
- Gradual shift to high deductible health plan(s)
- Emphasis on employee engagement
- Investment in population health management, targeted to clinical risks within workforce
- Financial rewards for participation in H&W and disease programs if appropriate
- Implement integrated health metrics
Plan Design
- Medium deductible HRA (e.g. $1,000 deductible for single coverage, deductible gap of $500 or less) phased in by partial replacement
- Traditional and high deductible health plans offered side-by-side
- Discounted premium on high deductible health plan facilitates 3 year migration to high deductible health plan
Type of Spending Account Used
- Primarily HRA/FSA
- HRA may permit unlimited accumulation, access at retirement, coverage of COBRA payments
- HRA may be designed to cover all IRS eligible expenses, with an FSA pay-first model
- Multi-purse debit card facilitates use of HRA with FSA to cover deductible gap
Incentives
- Incentives for actions:
- - Health Risk Assessment
- - Participation in Disease Management
- - Health fair/biometric screening
Care Management Framework
- Care Management carved out from health plan solution
- Health Risk Assessment and on-site lab screening
- Personalized health report
- Total Population Health Management
- - Health Portal
- - Full Spectrum Disease Management
- - Case Management
- - Wellness and Pre-disease Coaching
Advocacy and Decision Support Tools
- 24-hour nurse line
- May include 2nd opinion services
- On-line price/quality tools
Program Sequence
- Introduction of partial replacement high deductible health plan with HRA
- Integrated health metrics
- Case and Disease Management
- Move to full replacement with high deductible health plan and introduce financial incentives
- Move to total population health management with advanced health & wellness offerings
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