Employers Are Dropping Spousal Coverage, Cite Affordable Care Act Costs for Decision

Pointing to costs of the Affordable Care Act (ACA), some employers are dropping spouses from their group health plans next year.

In Mercer’s 2012 National Survey of Employer Sponsored Health Plans, which represents data from nearly 2,810 employers of all sizes, 6% of employers reported excluding spouses from coverage, and another 6% reported charging a spousal surcharge. This represents a total of 12% of employers with some type of special provision for spousal coverage, says Tracy Watts, a senior partner in Mercer’s Washington, D.C., office.

See the full story at AISHealth.com

Employers Stress Healthier Habits and Behavior Change in an Effort to Lower Health Care Costs

LINCOLNSHIRE, Ill., June 2, 2011 /PRNewswire/ — Employers are beginning to rely more on employees to stem the tide of rising health care costs, but the inability to motivate and change habits has prompted concern, according to Aon Hewitt, the global human resource consulting and outsourcing business of Aon Corporation (NYSE: AON).

Aon Hewitt surveyed 1,028 employers nationwide in its 2011 Health Care Survey and found that the top health care outcomes organizations would like to achieve this year are improving employee health habits (56 percent), lowering the health care cost trend (49 percent), decreasing worker health risk (44 percent), increasing participant awareness of health issues (37 percent) and enhancing participation in health improvement/disease management programs (37 percent).  This survey suggests that success may be difficult, as 56 percent of respondents say motivating participants to change unhealthy behaviors is the most significant challenge to accomplishing 2011 health care program goals.  This was followed by issues involving reluctance to change (26 percent), unpredictability of costs (23 percent), government regulations/compliance (22 percent) and managing the health of an aging workforce (21 percent).

In addition, this survey revealed that many companies offer disease management (70 percent), health and wellness improvement (64 percent) and behavioral health (60 percent) as key components to health care strategies.  In an acknowledgement that more needs to happen to achieve success, many organizations are looking to expand efforts during the next three to five years and implement strategies that focus on total well being to improve physical and mental health (60 percent), absence management (53 percent), and integrated safety and health improvement efforts (50 percent).

“Despite reform, organizations still face rising costs and worsening population health,” said John Zern, Americas Health & Benefits Practice leader with Aon Hewitt.  “It’s clear that traditional annual trend mitigation tactics alone won’t work.  As a result, leading employers are implementing a ‘house money, house rules’ environment, using a mix of incentives, penalties and targeted messaging to reward healthy behaviors.”

While some companies are budgeting for a medical trend increase during the next four years, many do not have a long-term increase built into their budgets as of yet.  Nearly one-third of respondents (30 percent) have budgeted an annual medical trend increase between 4 percent and 7 percent from 2011 – 2015, and 22 percent have budgeted an increase of more than 8 percent during that time.  Meanwhile, 42 percent have not built an annual long-term increase into their budget at this point.

“Employers are spending millions of dollars annually on health care, and yet many report they do not have a specific plan for how best to manage that investment,” notes Jim Winkler, Large Employer Segment leader in the Health & Benefits Practice with Aon Hewitt.  “Given the risks and opportunities presented by health care reform, it is imperative that employers develop a written strategy for controlling cost and improving health.”

Rewarding & Penalizing Participants

The Aon Hewitt survey also showed that 22 percent of employers will have programs in place by the end of 2011 to reward participants for achieving specific health outcomes, and 10 percent will have similar programs to penalize participants for exhibiting unhealthy behavior.  However, by 2016, 64 percent of organizations said they will add programs that reward for good health, while 46 percent said they will add programs that penalize for unhealthy outcomes.

Respondents currently offer incentives to employees for participation in key initiatives, such as biometric screenings (33 percent), health risk assessments (33 percent), wellness programs (31 percent) and tobacco cessation programs (27 percent).  Conversely, some employers are imposing a penalty for non-participation in biometric screenings (5 percent), health risk assessments (5 percent), wellness programs (2 percent) and tobacco cessation programs (6 percent).

Money serves as the primary incentive and penalty these employers use to promote employee participation in key programs, including health risk assessments (66 percent have a monetary incentive; 9 percent have a monetary penalty); biometric screenings (65 percent have a monetary incentive; 8 percent have a monetary penalty); disease/condition management (54 percent have a monetary incentive; 9 percent have a monetary penalty); and wellness programs (59 percent have a monetary incentive; 6 percent have a monetary penalty).

“In a challenging economy, organizations are using financial incentives, as a mix of rewards and penalties, to motivate behavior change,” said Jennifer Boehm, principal in the Aon Hewitt Health & Benefits Practice, and a project leader for the survey.  “However, leading employers also recognize that success requires more than just dollars; those organizations also focus on marketing health improvement services, eliminating barriers to needed care and measuring the impact of specific interventions.”

Additional Survey Data

  • One-third of organizations currently offer stress reduction programs and 35 percent offer nutrition programs to employees.
  • Slightly more than half (52 percent) of employers have initiatives targeted to employees with chronic conditions (e.g., asthma, diabetes, heart conditions).
  • Less than 20 percent of organizations have performance goals tied to wellness success or participation levels, while 49 percent plan to add this type of program in the next three to five years.
  • By 2016, 77 percent of employers plan to have targeted communications on their health care programs, based on workforce demographics.
  • By 2016, 61 percent of employers plan to use social media to reinforce smart health behaviors and actions with their plan participants.

About this Survey

Aon Hewitt surveyed more than 1,000 HR Professionals nationwide on their current and future health care plans and practices.  In the findings report, Aon Hewitt offers analysis on the trends and insights within the context of four dimensions of a successful health care strategy: optimizing plan design and funding, reducing expenses, engaging participants in managing health, and improving health and workforce productivity.  To download a copy of Aon Hewitt’s 2011 Health Care Survey Report, please visit www.aon.com/healthcaresurvey.

About Aon Hewitt

Aon Hewitt is the global leader in human resource consulting and outsourcing solutions.  The company partners with organizations to solve their most complex benefits, talent and related financial challenges, and improve business performance.  Aon Hewitt designs, implements, communicates and administers a wide range of human capital, retirement, investment management, health care, compensation and talent management strategies.  With more than 29,000 professionals in 90 countries, Aon Hewitt makes the world a better place to work for clients and their employees.  For more information on Aon Hewitt, please visit www.aonhewitt.com.

Regence Employee Choice Provides Flexible Health Plan Options for Small Businesses in Oregon

(Portland, Ore.) – Small employers are traditionally faced with a difficult choice when providing health coverage for their employees: they can either choose benefits that are affordable, or spend more and offer their employees a choice. In most cases, small employers end up sacrificing choice for cost, leaving their employees feeling frustrated and dissatisfied by the lack of health plan options. Because numerous studies have found that plan choice is one of the best predictors of employee satisfaction with health plans, Regence has introduced Regence Employee Choice—a menu of products that affordably enables small employers to empower their employees to choose among a variety of health plans.

“We know small employers want to provide their employees with a variety of health plans, and many times cost makes it hard for them to do so,” said Don Antonucci, vice president of Sales for Regence BlueCross BlueShield of Oregon. “With Employee Choice, you can be a small company and still offer ‘big company’ benefits.”

Available effective July 1, 2011 for fully insured groups of 2-50 enrolled employees in Oregon and Clark County, Wash., Regence Employee Choice allows employers to choose which of several of Regence’s self-managed Innova®plans and Regence HSA Healthplan 2.0SM consumer directed health plans they wish to offer to their employees. They can choose to offer as many of the available eight plan configurations as they wish.

The program also allows employers to add on a variety of optional benefits, including an Employee Assistance Program (EAP), Chiropractic benefits, and Vision benefits. Employers also have the option of adding a pharmacy and dental plan.

“Not everyone has the same health care needs – a young single person may want to choose different benefits than a family or a person who has specific health conditions to manage,” Antonucci said. “With Employee Choice, employers can offer several benefit and cost options to meet the specific health care needs of their employee base.”

To further engage employees in taking charge of their health, all of the Innova and HSA 2.0 plans have member wellness programs built in. These programs help employees and their families get the support they need to be more involved in their health care, and include:

  • myRegence.com – free, members-only Web site hosts personal health records, treatment and medication information, consumer tools, videos and discussion boards to engage members and reward healthy behaviors
  • CareEnhance® –  a toll-free, 24/7 health information resource
  • Regence Health CoachSM – members receive one-on-one help with their wellness goals from highly trained coaches
  • Special Beginnings® – maternity management program that includes specialized assessments, personalized tools and materials, and 24/7 nurse advice.
  • Regence Disease Management – certified disease managers teach members to monitor their condition daily and follow their treatment plan for optimal health

For more information on Regence’s self-managed and consumer directed health plans and product features, including Employee Choice, go to www.regence.com.

About Regence BlueCross BlueShield of Oregon

Regence BlueCross BlueShield of Oregon is a leading health plan in Oregon, with more than 750,000 members, offering health, life and dental insurance. Regence is the largest health insurer in the Northwest / Intermountain Region, serving nearly 2.5 million members as Regence BlueCross BlueShield of Oregon, Regence BlueShield of Idaho, Regence BlueCross BlueShield of Utah and Regence BlueShield (selected counties in Washington). Each plan is a nonprofit independent licensee of the Blue Cross and Blue Shield Association. Regence is committed to improving the health of our members and our communities, and to transforming our health care system. For more information, please visit www.regence.com or www.twitter.com/RegenceOregon.

Medical Home Pilot Nets Quality Gains, Cost Savings

ALBANY, N.Y. — CDPHP today announced that its nationally-recognized patient-centered medical home pilot resulted in dramatic declines in medical cost growth at three local physician practices. The pilot, designed to help physician practices transform their processes, improve care, and increase reimbursement for primary care physicians, showed that important opportunities exist to improve primary care in the area.
 
The three physician practices involved in the CDPHP® medical home pilot experienced a 9% reduction in the rate of overall medical cost increases—a savings of $32 per member, per month—as compared to other area physician practices, according to a Verisk Analytics™ independent analysis released by the Albany-based health plan.
The practices—Community Care/Latham Medical Group, Community Care/Schodack, and CapitalCare Family Practice Clifton Park—also demonstrated improvements in quality measures, most notably, the proper use of antibiotics and diabetic eye exams.
 
Data from the first year of the pilot also revealed significant reductions in advanced imaging utilization and emergency room visits. Total hospital admissions were 24 percent lower than otherwise expected among the population served by the practices participating in the pilot.
 
The independent analysis indicates that the novel payment model, in conjunction with the practice transformation support, made a difference in the way care was compensated and provided.
 
“We are very pleased by this news. It is an important first step in improving quality and transforming the way we pay for primary health care,” said Bruce Nash, MD, MBA, chief medical officer, CDPHP, who has overseen the pilot since its launch in May 2008. “While CDPHP and the physician practices currently working towards transforming their practices recognize that there are still significant opportunities for improvement, we know we’re headed in the right direction.”
 
The Future of CDPHP Enhanced Primary Care
In September 2010, 21 additional practices began the transformation scheduled to conclude at the end of 2011. Between the first and second phases, the program encompasses 24 physician practices, approximately 150 local physicians, and more than 50K CDPHP members. Given the third-party results and the medical community’s continued interest in the program, CDPHP will begin recruiting for Phase III of this initiative, now called the CDPHP Enhanced Primary Care program.
 
New elements have been added to the subsequent phases, including the embedding of CDPHP nurse case managers within the participating practices. These nurses work collaboratively with the practice staff to better facilitate medical, behavioral, and pharmaceutical services for patients. This interaction will play an integral role in realizing additional future savings from reduced hospital, emergency room, and imaging services.
 
Phase III will consist of primary care practices (family practice, internal medicine, and pediatrics) chosen by CDPHP by the end of May 2011. Selected practices will display strong leadership and a stable practice culture, and serve a significant number of CDPHP patients. The practice will need to demonstrate commitment in achieving NCQA Level III Medical home and enhancing access, as well as an overall willingness by practice leadership to participate and openly collaborate with CDPHP. In addition, due to the significance of technology in the medical home model, practices utilizing EMR and ePrescribing are preferred.
 
“The program’s initial results have thus far exceeded anyone’s projections,” said Nash. “If the results from the second year of the pilot even partially support these initial data, the CDPHP model will not only hold tremendous value for this region, but for national reform efforts as well.”
 
About CDPHP®
Established in 1984 as a physician-founded and guided health plan, CDPHP and its affiliates currently serve members in 24 counties throughout New York with a full family of products.

BCBSNC, UNC Health Care Announce Partnership To Launch Novel Patient-Centered Practice

CHAPEL HILL – The state’s leading health insurer and the state’s health care system will collaborate to develop a completely new type of medical practice in which patients – not just their symptoms – are the focus of care. This advanced medical practice will extend beyond what is currently called the ‘medical home’ and will enable teams of health care providers to work collaboratively with patients and families in delivering high quality, coordinated care. BCBSNC and UNC Health Care expect the new practice, which will likely be located in Orange or Durham county, to open in the fourth quarter of 2011.

This venture would be the first product of what BCBSNC and UNC Health Care expect will be an ongoing collaboration in which they work together to enhance health care quality, improve efficiency and effectiveness, and reduce healthcare costs.

“The team approach to care emphasizes patient involvement and allows more time for clinical interaction and patient education and support,” said BCBSNC President and CEO Brad Wilson. “We believe this approach will result in improved health and fewer complications – both of which will help control rising health care costs.”

“We’re in an era of change in health care, so let’s work together to make positive change,” said Dr. William L. Roper, CEO of UNC Health Care.  “This innovative approach with education, patient support and self-management is one important step toward making health care less mysterious and more effective.”

The practice will care for 5,000 BCBSNC members focusing on patients with chronic conditions, including coronary artery disease, hypertension, diabetes, obstructive lung disease, major depression, and asthma. 

The new practice will provide continuity by coordinating care across a variety of settings and provider types. The practice is designed to enable more effective patient-provider interactions, which should result in better patient satisfaction and improved health. Additionally, this practice will provide an expanded set of services and greatly enhanced access to these services including:

  • Non-traditional visit formats (e-visits, televisits, home monitoring)
  • On-site mental health
  • On-site nutritionist
  • On-site pharmacy and medication management
  • On-site laboratory
  • Case management and coordination of care for patients requiring hospitalization
  • Group and educational visits
  • Extended weekday and weekend hours
  • State-of-the-art information technology

About BCBSNC: 
Blue Cross and Blue Shield of North Carolina is a leader in delivering innovative health care products, services and information to more than 3.7 million members, including approximately 900,000 served on behalf of other Blue Plans. For 77 years, the company has served its customers by offering health insurance at a competitive price and has served the people of North Carolina through support of community organizations, programs and events that promote good health. Blue Cross and Blue Shield of North Carolina is an independent licensee of the Blue Cross and Blue Shield Association. Access BCBSNC online at http://www.bcbsnc.com.

About UNC Health Care:
The UNC Health Care System is a not-for-profit integrated health care system owned by the state of North Carolina and based in Chapel Hill. It exists to further the teaching mission of the University of North Carolina and to provide state-of-the-art patient care. UNC Health Care is comprised of UNC Hospitals, ranked consistently among the best medical centers in the country; the UNC School of Medicine, a nationally eminent research institution; community practices; home health and hospice services in seven central North Carolina counties; and Rex Healthcare and its provider network in Wake County. Although this new practice will only provide care for BCBSNC members, UNC Health Care’s other physician offices, hospitals and facilities will continue to provide care for patients with all types of insurance and those without insurance.

What Do Employers Want from Health Insurers in 2010.

What do employers want from health insurers in 2010? According to a new study by PricewaterhouseCoopers Health Research Institute they want two things: Better information and more value.

Employers expectations of their health insurers continue to change. While many studies examine the relationship between employees and their employer-sponsored benefits, less is known about employers and what they want from health insurance carriers. The report published by PricewaterhouseCoopers Health Research Institute, provides insights and key observations on opportunities for employers and health insurers.What employers want from health insurers in 2010.

Mainly, the study found that employers satisfaction with their health insurers eroded during the past year. The study reported that, “Hit by a major recession and thrust into the teeth of a national debate on health reform, employers are taking a critical look at their health benefits strategy and the value they derive from it.”

Here are the key findings:

  • Satisfaction by large employers decreased by an average of five percentage points, from 64% in 2008 to 59% in 2009, while satisfaction among small employers held steady.
  • Overall, small companies continue to be less satisfied with insurers than large companies. Among small companies, the smaller the company, the less satisfied it is with insurer services. Small employers are less satisfied than large employers by an average of seven percentage points.
  • Employers continue to want more meaningful and higher-quality data to help them control costs and keep their employees healthy. Employers would like insurers to take an active role in waste reduction and are looking for consistency and transparency in their health benefit plans.
  • Interest in personal technology tools is surging. Nearly half of all employers now say it is important for insurers to offer them; however, less than half are satisfied. Satisfaction with personal heath records and online comparison tools has dropped 10 percentage points for large employers.
  • With participation hovering around 50% for the past two years, employers need to look beyond the same financial incentives to engage employees in completing health risk assessments and biometric screening. Biometric screening participation decreased in all the incentive categories except the $500 premium reduction and no-incentives categories. Completion of health risk assessments (HRA) jumped eight percentage points in the no-incentives category, but dropped slightly in overall participation.
  • Despite or possibly because of the recession, 60% of employers said they would increase cost-sharing for healthcare with their employees. Of the employers surveyed, it was the most prevalent cost-control strategy.

PricewaterhouseCoopers Health Research Institute (HRI) provided this research-based insight by evaluating results of surveys conducted by the firms Barometer team that included executives at approximately 100 large US-based multinational companies (Management Barometer survey) and 130 privately held small companies (Trendsetter survey). Large companies had an average of 11,000 employees and revenues of about $4 billion, and small employers had a workforce of less than 200 employees and average revenues of $24.3 million. In addition, PwC surveyed more than 650 human resources executives as part of its annual Health and Well-Being Touchstone Survey, which provides detailed benefits information and future healthcare strategies from US companies in 30 industries.

HRIs research also included in-depth interviews with thought leaders and executives of employers, insurers, and other businesses. Additionally, HRI conducted a literature review of reports and guidance from associations, regulators, and academia to gather insights on current challenges and leading practices.

To obtain a copy of the report, click here.

About PricewaterhouseCoopers

PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for our clients and their stakeholders. More than 163,000 people in 151 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

Health Research Institute

PricewaterhouseCoopers Health Research Institute provides new intelligence, perspectives, and analysis on trends affecting all health-related industries, including healthcare providers, pharmaceuticals, health and life sciences, and payers. The Institute helps executive decision-makers and stakeholders navigate change through a process of fact-based research and collaborative exchange that draws on a network of more than 3,000 professionals with day-to-day experience in the health industries. The Institute is part of PricewaterhouseCoopers larger initiative for the health-related industries that brings together expertise and allows collaboration across all sectors in the health continuum.

Source: PricewaterhouseCoopers

New TriZetto Value-Based Benefits Solution Paves Road to Member-Level Benefit Design and Incentives.

Employers, benefit consultants and the government are calling for value-based health benefit designs to align consumers’ incentives to improve health and reduce unnecessary healthcare costs.

!Trizetto-logoTriZetto, a leading supplier of health claims management systems has announced the availability in early 2010 of a new solution to give payer organizations the ability to customize benefits and other incentives for individual members based on their health status, chronic conditions and health and wellness activity.

Value-based benefit designs use financial incentives to encourage members to adopt healthier lifestyles and effectively manage chronic conditions by adhering to recognized healthcare guidelines.

“Incentives, combined with an effective value-based design, are powerful tools in achieving population health improvement,” notes author Cyndy Nayer in the newly released book, Leveraging Health: Improve Health Status and Bend the Trend on Financial Inflation With Value-Based Designs. “Innovators use data to develop an integrated suite of plan design features and incentives that will incrementally improve the health management of populations.”

“The key to successful value-based benefits design is to truly individualize the benefits and claims adjudication to the specific clinical conditions of each high-risk member and to reward participation in health and wellness and appropriate condition management programs,” said Gail Knopf, vice president of enterprise strategy at TriZetto. “Until now, these tasks have required a heavily manual, labor-intensive effort. TriZetto’s Value-Based Benefits Solution will automatically adjust co-pays or coinsurance on specific claims in real time during the plan year based on effective dates of qualifying events — such as a diabetic health plan member completing a course to better understand his or her condition — unlocking the potential of value-based benefits programs to improve member health and productivity and to stem medical cost increases.”

“By incenting the proper use of medications and care services to control high-risk diseases, early adopters of value-based benefits have reduced the total cost of their population health as much as 32 percent below industry benchmarks,” said Nayer.

“While initial programs stressed Rx compliance to manage disease, more sophisticated designs that address pre-emptive medical care for high-risk diseases are now emerging,” Knopf added.

TriZetto is the leading privately held healthcare information technology company to the healthcare payer industry. More information is available on www.trizetto.com.