Insights Into Managing Health Benefits In This Era of Change

The healthcare marketplace is undergoing fast-paced changes fueled by political and regulatory events, medical, pharmaceutical and technology advancements, consumerism, and growing payer engagement in value-based reimbursement and contracting.  It was with these healthcare environmental forces in mind that the Employer-Provider Interface Council (EPIC), in partnership with Rutgers University – Ernest Mario School of Pharmacy – Health Outcomes, Policy and Economics Center (HOPE Center) recently (June 11, 2019) convened Managing Health Benefits in the Era of Change.

Focusing on three emerging themes of Consumerism and Healthcare transparency; Law, Regulatory & Policy updates relevant to self-funded payers; and Value, Quality and Coverage, the program format included a brief topic overview from different stakeholder perspectives, followed by a Q&A session for presenters and participants directed to a Reactor Panel representing payer and provider stakeholders within the healthcare community.

Audience and on-line attendees for this inaugural morning program were welcomed by Dr. Laura Pizzi, PharmD, MPH, Professor and Director, Hope Center, Rutgers University, and Dr. Randy Vogenberg, Ph.D., Founder, EPIC. Each provided a brief overview of recent research in the self-funded payer space, but one slide by Dr. Pizzi was particularly noteworthy[1].  From 1999-2018, worker contributions to healthcare spend for family-based coverage increased 259%, as family-based premiums increased 239%.  During the same time period, there was an underlying inflation rate of 59%, while worker earnings increased only 68%,  clearly illustrating that healthcare affordability in the U.S. has arrived at a critical crossroad from an insured purchaser perspective.

Other points of interest from thought leader presentations and Reactor Panel discussions included the following:

The first thought leader topic on the morning schedule, The Importance of Quality and Value to Healthcare Consumers, was presented by Mary Alice Lawless, Co-Founder, The Foundation for Health Smart Consumers.  Mary emphasized that her Foundation is focused on providing a platform for consumers to have “skin in the game”. While emphasizing that TRIPLE AIM initiatives are still achievable, the current directive is to empower self-care.  Other relevant points included:

• Less than 7% of total private health spending is “shoppable” and paid OOP by consumers
• HDHP casualties include decreases in obtaining necessary as well as preventive care, passivity in seeking best available options, and an unengaged beneficiary base.
• Existing consumer confusion differentiating between quality and their satisfaction.

Reactor Panel discussion highlights for this session included agreement amongst panel members that consumers are not highly engaged in researching plan options despite readily available information, often perceived as incomplete and overwhelming to the average consumer.  Quality standards are not as readily available as pricing information, the result being consumers often make decisions based on price instead of price and quality, leaving a gap in the value determination.

Next on the schedule, Needs of Employers was presented by Neil Goldfarb, CEO, Greater Philadelphia Business Coalition on Health who opined that as the major purchasers of healthcare in the US, employers will eventually aggregate their market power to influence value-based results.  Other concerns mentioned:

• Emphasized that employers need complete transparency in all aspects of healthcare
• Value for his client base is focused on productivity and workforce well-being.
• Improvements are needed for beneficiary resources to manage healthcare benefits
• Employers are clamoring for improved access to data and support for interpreting actionable steps to reduce costs and improve outcomes

Reactor Panel discussion highlights for this session included potential solutions using real-time data and employers holding providers accountable to their contractual obligations for performance improvements, value, and better outcomes. An attendee contributed that unless executive level or C-suite engagement ensued from the start of a valued-based initiative, a strain on building value-based relationships will persist.

After a short break, Payer Perspectives for Employer Innovation was presented by Steve Peskin, MD, Executive Medical Director, Horizon Blue Cross Blue Shield, New Jersey, who commented there is “cognitive dissonance’ in the Pay for Value conversation. At Horizon they are nurturing innovation at a local level through Blue Innovation Labs across the country, improving healthcare delivery and capabilities through the latest technologies. e.g. Artificial Intelligence and Predictive Analytics, and deploying the use of SDOH to create positive ROI by reducing barriers and improving access to care. Yet he noted that new standards for measuring and expressing Quality and Value are needed for stakeholder guidance and consumer understanding.

The Policy Landscape was presented by D.C. based Kip Piper, MA, FACHE, President, Health Results Group.  The tone of his talk was established with an opening statement that we are not experiencing a cyclical change, but rather a sea change of dynamic, rapid, challenging and dangerous times for healthcare. He then opined Medicare Part A could be insolvent by 2027.  Additional comments included:

• Medicare – CMS continues to focus on payment reform, accelerating the rate at which healthcare providers take on risk.
• Medicaid – discussions are underway for supplemental benefits and services. CMS is also considering an expansion of block grants.
• More federal and state regulatory effort can be expected in the area of price transparency as this topic resides within the Overton Window (how public discourse fits into established consensus policy).
• In addition to paperwork reduction efforts, CMS is also working to enhance education efforts to close stakeholder knowledge gaps.

The final presentation, Aligning Stakeholders for Activation Around Value, given by Jennifer Bright, MPS, Executive Director, Innovation and Value Initiative (IVI) was initiated with a declaration that the concept of value depends on where you sit in the healthcare continuum. Value can be defined in many ways, not simply by the quality-adjusted life year (QALY), an oft used measure of value found in cost-effectiveness research.  Importantly, however, value assessment and methods matter.  Trust and complexity can be deterrents to change, especially in today’s healthcare marketplace.  Additional thoughts around value included:

• A collaborative effort is required to align all viewpoints and the processes used to chart a path forward.
• Alignment efforts must include the patient perspective as a driver of the value conversation. PRO (patient reported outcomes) is an essential component of evolving value determinations.
• Key principals in achieving value in healthcare include scientific rigor, transparency, patient centricity, affordability, innovation, and market-based solutions.

Reactor Panel discussion highlights for this final session included opinions that value can be measured in various ways, however, focusing on better health outcomes for patients should be the ultimate goal.  One of the Reactor Panelists offered an example regarding high-priced oncology medications which may provide only 3 additional months of life. Providers, patients, and caregivers should be having conversations about the quality of those last 3 months to determine the humanistic value of the treatment.  Another panelist mentioned that hospitals utilize a number of resources prolonging life, but perhaps the focus should include productive life and not simply duration.

In summary, there is growing consensus among stakeholders, providers, and consumers that more emphasis on value, and simplification of relevant information to facilitate informed decision making are commonly expressed needs, and a universal goal in improving quality and creating value in the U.S. healthcare system. The shift from event-specific treatment to more holistic and personalized care is a step in the right direction.

[1] KFF Employer Health Benefits Survey, 2018; Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2017. Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April), 1999-2018; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, 1999-2018 (April-April).