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Large Employer Health Benefits Survey

By August 20, 2019Commentary

The National Business Group on Health represents some of the largest, and most sophisticated, employers in the country.  It annually surveys its members for their perspectives on key health benefits issues.  The current survey was just released.   (NBGH Report)   147 employers participated in the survey, and they have over 15 million employees and dependents covered by their health plans.  A whopping 17%, or about 20, of these companies have over 100,000 employees.  One notable finding is that even more of these employers, 36%, view health benefits as a fundamental part of their overall workforce strategy than did last year, at 27%.  The top initiatives mentioned by the respondents in regard to health benefits were more use of virtual care, 51% mentioned; managing high-cost claims, 39%; using more centers of excellence, 26%; creating an employee engagement platform, 26%; and targeted specialty pharmacy management, 25%.  Respondents were especially enthusiastic about the virtues of telehealth and they are expanding their focus on primary care, with increasing numbers saying they have or will use steerage to direct patients to ACOs or other high-performing networks, will have on-site or near-site primary care clinics and will use virtual primary care.  Interestingly, 9% say they are even looking at direct primary care provider contracting.  And this set of companies is moving away for CDHP as the sole plan, adding other designs to give workers a choice.  Large employers have always been a bit subject to the latest trend (also known as a fad), partly driven by benefit consultants looking to drum up work, and they are paying more attention to social determinants of health, particularly financial ones, with 90% of employers adding that to plan considerations and 80% adding health literacy and access.

Actual median health benefit cost increases were 3.6% in 2018 for this group of companies, compared to projections of 5%.  Per person costs are expected to reach about $15000. That is a big number.  Actual costs have consistently come in under projections in the last few years.  5% is the current projection for 2019 and 2020.  While spending increases in this decade have been muted compared to the prior one, both the absolute level and the rate of increase cause angst for employers and employees.  Almost all of the cost increase is driven by pricing, not utilization. The respondents said musculoskeletal conditions, cancer, diabetes and cardiovascular conditions were particular drivers of spending rises.  Looking forward, companies are particularly concerned about new, very high-cost therapies and continue to try to better manage specialty pharmacy costs.  These large firms aren’t hot on Medicare for All.  57% said it would increase health spending, 70% said it would decrease innovation, 56% said it would decrease quality and almost all said they expected an increase in taxes.  They were split on expanding Medicare access by lowering the eligibility age, with 55% supporting some age reduction and 45% opposing.

Let me mention a special thanks to the NBGH for giving me access to the full report for use in this post.

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