These days, navigating an overburdened and complicated healthcare system is a common struggle for all Americans. As costs continue to increase despite less access to care and far fewer available plan options, it is clear that the employer-sponsored healthcare system is broken. Employers are fed up with the rising costs of plans that don’t meet expectations-- or sometimes even the needs-- of their employees and covered dependents.
Real change to the US healthcare system will only come when employers decide to do something about it. Experts in the field of healthcare analysis were not surprised when, in 2018, JP Morgan, Amazon, and Berkshire Hathaway decided to band together to fundamentally change how healthcare is provided to their employees. With a focus on better care for less money, the companies hoped to create a model that was “free from profit-making incentives,” the very elements that have crippled the US current system.
So what can you do if you aren’t employed by one of these behemoth companies? -- is there a better path that cuts costs and increases employee satisfaction for small to mid sized businesses? There is, and it's being led by employers and advisors who are using smart data analytics firms like Innovu to make better healthcare decisions and offer more personalized options for employees.
Employers pay for the majority of the healthcare costs for American employees, and have been seeing these costs escalate significantly over the years. On average, employers pay for 82% of single coverage plans, and 71% of family coverage plans. In 2018 a single coverage plan cost employers around $5,565 with an average employee contribution of $1,241 per year. For family coverage, employers paid $13,927 while the employee made up the rest by paying $5,689 through payroll deductions. These are no small numbers, and employers have started to realize that in order to kickstart the system and cut through the spending and waste, they’re going to have to lead the way.
Since most US employers are self-insured, they have the freedom to control the market and choose where they get healthcare benefits for employees. This means they are able to make agile decisions and changes. While there may be a contract with a particular insurance provider one year, employers can choose to not renew that at the end of the term, giving them power to find the best deals for their specific employee population.
Beyond just cost, employers can make decisions based on what’s best for their size and the makeup of their employees. By thoroughly analyzing healthcare data , a clear picture emerges of how employees are using their benefits, what is most utilized and where unnecessary coverage is eating up costs, employers can start to craft a more customized healthcare plan that suits their unique population. Complete data analysis via partnership with an industry leader in analytics will uncover hidden cost drivers and dramatically reduce waste. Using these analytics, employers and advisors have the ability to tailor plans, identify redundancies and clean up wasteful spending.
Health data companies are fueling the way forward, offering the creative and innovative solutions employers need, with little investment and big returns. These innovative analytics companies are looking at current trends and their impact well into the future to help curate better, more effective healthcare solutions for companies around the country. Investing in data analysis via Innovu and utilizing their customized deep dive dashboards is a great way for employers to get a full spectrum view of their current state, and plan ahead to save thousands of dollars, reduce redundancies and improve the overall health of their employee population.
With pharmacy costs alone accounting for 21 cents of every healthcare dollar spent, employers and employees must keep a close eye on prescription drugs. Many employers and health benefits advisors find themselves hard pressed to identify an equitable solution that provides quality drug coverage without breaking the bank or compromising prescription integrity. Benefits consultants, powered by the knowledge and benchmarks provided by Innovu have been leading the way for employers to look at pharma costs as an ideal first step to saving crucial dollars during the COVID crisis.
The climate is right and employers and advisors finally have the power to bring about significant change. But where to start? The best and most logical first step is to examine the needs of their own employees. Employers should take a look at the data and use that to design or improve programs intended to engage employees and help them to stay healthier, longer. From better preventative care to more comprehensive, less expensive prescription plans, innovative employers can lead the way to a more robust, more effective healthcare system.
The Bottom Line
Employers have the momentum to change healthcare for the better -- The cycle of rising costs can be broken, and those employers and advisors who are willing to look at the data, do the analysis and foster change will see their healthcare costs decline.
Check out more COVID-19 content and business operations solutions at innovu.com/resources.