How Is Your Health Plan Responding to Millennials?

You might be surprised to hear that millennials represent one third of the American workforce, but Pew Research Center confirms it. If your health benefit plan hasn’t adapted to the needs and lifestyles of these young people, you’re missing an opportunity to boost retention, build loyalty and enhance wellness.

For starters, it’s important to realize that 45% of young adults age 18 to 29 do not have a primary care doctor. They do, however, have a smartphone and you can bet they use it to access the internet constantly. With online sources like WebMD offering so much healthcare information, it’s no wonder that millennials are likely to self-diagnose and even treat one another at home before seeing a doctor. If young people can find much of the healthcare information they need in the palm of their hand, you can bet they expect to find benefits and enrollment information easily accessible as well.

They Want Information Now
Just like so many of us who have come to expect an immediate response to everything, millennials who do need a doctor expect the visit to happen quickly and easily. According to PNC Healthcare, this explains why 34% of millennials prefer to use a retail clinic rather than waiting several days to see a primary care physician in their office – a rate twice as high as baby boomers. It would also seem to point to an increased use of telemedicine.

Cost Matters to Millennials
Millennials face more than their fair share of financial pressures and take their finances seriously. Surveys show they are more willing to request a cost estimate prior to choosing a treatment option than baby boomers or seniors ever were. This not only makes cost transparency tools important, but it’s a very positive trend that should contribute to lower claim costs going forward.

Whether it be treatment options, provider access or cost of care, the demand for health and benefit plan information will only increase as more and more millennials enter the workforce. In order to respond to change, self-funded employer groups will need the resources of an independent TPA that can combine the right plan design with more personalized, interactive communications and more innovative ways for younger employees to access the more personalized care they will need going forward.

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States Crack Down on Balance Billing

medical-moneyCurrently, only 21 states offer some protection against balance billing and most existing laws apply to emergency services required from out-of-network providers. Few, if any, address balance bills received for treatment by an out-of-network provider in an in-network hospital. In Pennsylvania, the Governor and General Assembly have introduced two bills aimed at taking consumers out of the middle of the reimbursement process. These bills have come after several other states have adopted more comprehensive laws that prohibit balance billing entirely.

Some measures addressed in Connecticut, New York, Maryland, Florida and New Jersey include:

  • Protections in emergency department and in-network hospital settings
  • Prohibiting providers from balance billing and requiring carriers to hold their members harmless
  • Adopting reimbursement rate standards and a payment dispute resolution process
  • Applying these laws to all types of managed care products, including HMOs and PPOs

The goal of the proposals is to keep covered persons out of the middle of carrier-provider payment disputes. In non-emergency procedures, healthcare facilities in New Jersey are required to disclose whether they are in-network and advise the covered person to ask if their physician is in or out-of-network. Individual healthcare professionals must inform the patient if they do not participate in the person’s plan network and provide a billing estimate and applicable CPT codes. With healthcare costs continuing to rise and a lack of federal regulations, we can expect more states to take measures to protect healthcare consumers. We will strive to keep our clients informed as changes develop.

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Deductibles Keep Rising

acaThe International Foundation of Employee Benefit Plans reports that individuals enrolled in employer-sponsored healthcare plans are now paying an average deductible of $1,491 for individual coverage and nearly $2,800 for family coverage. These numbers are up from $1,300 and $2,500, respectively, in 2016.

Individuals covered by HDHPs have average deductibles of $2,296, with families averaging $4,104 – more than twice the averages for traditional, non-high deductible plans. The online survey included nearly 700 U.S. members of IFEBP and was conducted in February.

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Self-Funding: More Than a Means to an End

self-fundingIn an effort to take control of their healthcare spend, more employers continue to move to self-funding. But as those who have used this funding mechanism for some time have learned, designing a self-funded health benefit plan is just the beginning. When a health plan is self-funded, the entire healthcare supply chain is unbundled, giving everyone a clear, unobstructed view of the healthcare spend. An experienced Third Party Administrator will help you identify exactly where your healthcare dollars are going. Providers can be evaluated. Opportunities to achieve quality outcomes and lower costs can be explored. Best of all, unlike fully-insured health plans that are carrier-based, employers who self-fund their health benefits have the flexibility to act.

Target Cost Transparency

According to the Centers for Medicare and Medicaid Services, healthcare costs have increased by more than 260% since 1999. One of the biggest problems is costs for the same service can vary drastically from one provider to the next, even when the providers are located in the same marketplace. One way to attack this problem is with Reference Based Pricing, which typically allows qualified self-funded health plans to pay for medical services based on a percentage of Medicare, rather than by applying a percentage discount to a facility’s billed charges. Using an accepted index such as Medicare has enabled a growing number of health plans to bring cost transparency and consistency to hospital billing, since Medicare sets prices for every procedure.

Communicate with Purpose

From mobile cost transparency tools to telemedicine, employers are doing more than ever to help plan members utilize their benefits. Engagement rates, however, often tell a disappointing story as many employees are reluctant to use these new features. Experience tells us that whether we’re talking about a published provider directory or an online member portal, most people are confused by healthcare coverage.

Whether your company decides to place colorful posters in gathering spots, hold employee meetings or distribute email newsletters, emphasizing the steps you’re taking to make healthcare more accessible and affordable is critical. In this time of full employment and intense competition, health benefits can play an extremely important role in attracting and retaining valued employees. Don’t miss this opportunity to enhance your company culture and improve your employees’ quality of life.

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Traditional Plans Decrease

stethescope for healthcareSince 2007, adults ages 18 to 64 with employment-based coverage have increasingly chosen High Deductible Health Plans (HDHP), both with and without Health Savings Accounts  (HSA), over traditional plans.

In 2017, the number enrolled in HDHPs without an HSA rose to 24.5%, while HDHPs with HSAs rose to 8.9%. Some employers are choosing to only offer HDHPs, helping shift employees away from traditional plans.

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Troubleshooting Telemedicine

ebso-telehealthThe healthcare landscape is changing as providers increasingly offer virtual care options, and naturally it’s taken some getting used to. A recent study by the Deloitte Center for Health Solutions found that while patients who have used virtual care reported a 77% satisfaction rate, only 44% felt that their wait time was reduced compared to an in-person office visit. Some offices are designating doctors for virtual care on specific days of the week to circumvent wait times caused by healthcare professionals bouncing between in-person and virtual patients.

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More Patients Texting

Healthcare professionals that aren’t utilizing text communications are failing to meet their patients where they are. A 2018 survey found 11% of patients would rather communicate via text message, a number that is expected to grow as the Millennial population begins to outnumber Boomers. Text alerts and communications can be used for a variety of services, including preventative care such as periodic appointments and flu shots, post-treatment care information, remote health monitoring and chronic disease management.

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Healthcare Consumers About to Have Their Day

ebso-giantsFrom Amazon, Berkshire Hathaway and JP Morgan to Walmart and Humana – disruption is all around us. The future of our healthcare system is unfolding right before our eyes and regardless of how this giant chess match turns out, health plan participants just may be the biggest winners.

The Retail Effect
While many healthcare plans have done well under Obamacare, they need to review what many retailers have experienced since Amazon began building its Prime subscriber base of 100 million plus. When you consider the scope of Walmart, their potential for retail clinics is virtually unlimited. Whether by Amazon, Walmart or others, home delivery of prescriptions could make things very difficult for brick and mortar pharmacies. No matter what area you examine, these mega-partnerships have the potential to impact access to care in ways that most traditional healthcare providers have never imagined. And, if recent retail history means anything, healthcare consumers are sure to benefit.

Self-Funding Will Rule
Most working Americans are already covered by self-funded health plans, and we would expect the new Amazon, Berkshire Hathaway, JP Morgan family to offer at least one self-funded option. Studies show that self-funded plans offer employers far more flexibility than fully insured counterparts and Berkshire Hathaway’s Specialty Services unit certainly has the resources to provide the required stop loss insurance.

A Transparency Opportunity
With a little creativity, the transaction processing infrastructure of JP Morgan could make real-time claims processing a reality for fellow plan members. Real-time payments may encourage providers to discount more. Add telehealth and enable physicians to view electronic medical records and patients may know what to expect from their visit and what they will pay before they make the appointment. The bottom line is that as the level of information sharing increases, cost transparency and the potential for savings will grow.

As a TPA dedicated to controlling costs for self-funded health plans and members, we know these deals will keep more people out of the hospital and increase competition for outpatient care. Technology will move forward, actionable data will be more accessible and consumers will have their day as costs become more transparent and delivery more user-friendly.

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Economies of Scale for Small Businesses

ebso-embIn late June, the Department of Labor introduced final rules on Association Health Plans (AHP), which will allow bonafide associations to offer healthcare plans to member companies. While we had hoped for a different approach to regulating these plans, association health plans will be regulated by states as MEWAs.

According to the final rules, an association that wants to establish a healthcare plan must already exist for another purpose. In other words, an association cannot be formed for the exclusive purpose of offering healthcare plans to its members. Another stipulation is that new self-funded association health plans cannot be established until April 1, 2019.

Association Health Plans will be exempt from the federal mandate on essential health benefits, but will remain consistent with popular Obamacare rules such as coverage of pre-existing conditions and bans on lifetime limits.

While reserve requirements will vary from state to state, we expect that these plans will be quite costly to establish and closely monitored by state regulators. Nonetheless, for large associations with significant cash reserves, we expect this option to make it possible for thousands of small businesses to lower their cost of employee health benefits.

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Employees’ health care burden growing 8 times faster than wages

This article was published on October 3, 2018 on BenefitsPro, written by Emily Payne.

When the Kaiser Family Foundation started tracking employer health benefits 20 years ago, employee deductibles weren’t a concern. Over the years, though, the survey has adjusted to reflect not just the growing percentage of employees with a deductible (85 percent in 2018) but the growing amount of that deductible ($1,573 for an individual in 2018) .

In fact, according to the 2018 KFF Employer Health Benefits Survey, the burden of deductibles has tripled in the past decade and increased eight times faster than wages. Among small employers, 42 percent of workers pay a deductible of $2,000 or more.

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“Rising health care costs absolutely remain a burden for employers, but they’re a bigger problem for workers, as cost-sharing has been rising much faster than wages in recent years,” KFF president and CEO Drew Altman said in a press briefing.

This year’s survey shows no dramatic shifts in the employer-sponsored health care space but continues to illuminate a number of trends, including increasing health care premiums, greater focus on employee wellness and alternatives to traditional health care providers.

Premiums have increased five percent this year, costing a family for four an average of $19,616. Of that cost, employees contribute $5,547, and employers pay the rest. For single-coverage, premiums increased 3 percent to $6,896.

“Premium growth is important, but it’s only part of the story,” noted Altman. “The bigger issue is rising cost-sharing. What happens with wages can be as important to closing that gap as what happens to cost-sharing itself.”

Almost half of employers continue to offer PPO plans, while three in 10 offer a high-deductible plan with a savings component. Some employers (13 percent) offer an incentive to encourage employees to opt for one plan over another.

HDHP adoption is stagnating, comprising 29 percent of all plans. Part of this slowdown may be due to the uptick in the economy. “Given the economy is good and health care costs are relatively tame, I think employers don’t have a strong incentive at the moment to push people into plans they may not be as comfortable with,” said Gary Claxton, KFF vice president and director of the Health Care Marketplace Project. “I think we’ve stalled a bit on the growth of HDHPs. Things will get more interesting if we move into a recession.”

Wellness is getting more of employers’ attention. Seventy percent of large firms now offer health-risk assessments, and 81 percent use data from those assessments to better understand health risks, target their wellness program promotions, design new programs and/or measure health care costs. “As employers have gotten more involved in trying to develop programs to encourage employees to be healthy, having the info is necessary to determine what kind of programs to sponsor and what employees need information about,” Claxton said.

More employers are looking at workers’ activity data–21 percent now collect information from a wearable device as part of their wellness program, an increase from last year’s 14 percent.

Interest in telemedicine and retail clinics continues to grow. Among large employers, 74 percent offer telemedicine services, an increase of 63 percent since last year. In addition, 76 percent cover retail clinic services, and some offer employees a financial incentive to choose these services.

A number of factors, including wages and the economy, will continue to impact the employer health care space in the coming years. Ten percent of employers expect that the elimination of the individual mandate will result in fewer workers purchasing employer-sponsored coverage.

Another factor asked about during the briefing was the increase in prices by health care systems and providers. Consolidation among major health care systems continues to shift the balance of power when it comes to price negotiation. “We’re in a competitive health care system,” Claxton noted. “We rely on private insurers and employers to mediate prices. They haven’t been very successful in recent years. It is hard because most workers work for fairly large employers with multiple locations. It’s hard to develop narrow, efficient networks that would cover all of your employees, and the large health plans don’t really have an incentive to create these options.”

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