Category Archives: health insurance

The Benefits That Employees Like Best

So it’s not all about the money.

Countless studies have shown employers that much over the past few years, as benefits packages—retirement plans, leave policies, wellness programs and so on—figure more and more prominently in employee satisfaction scores.

But which benefits matter most to workers?

Glassdoor Economic Research, the research arm of Sausalito, Calif.-based job and career website Glassdoor, sought answers to that question in a pair of recent studies.

The first, Which Benefits Drive Employee Satisfaction?, sampled more than 470,000 benefits reviews left anonymously on Glassdoor by employees over the course of roughly 15 months. The sample included 1,226 U.S. employers with at least 20 benefits reviews, across all sectors and ranging in size from 50 employees to more than 10,000 employees.

Not surprisingly, health insurance had the biggest effect on how employees rated their satisfaction with employers’ benefits offerings, followed by retirement plans and vacation and paid time off.

Conversely, employee discounts and maternity/paternity leave were found to have little impact on overall satisfaction.

The latter finding may seem surprising when you consider the trend toward more generous leave policies. But, while many employers have indeed added maternity and paternity leave benefits in recent years, “it is possible benefits that are not used by a large subset of employees do not impact overall benefits package satisfaction,” according to Glassdoor.

For its Benefits Review survey, Glassdoor dug a bit deeper, collecting data from employee reviews of 54 distinct employer-provided benefits, such as pet-friendly workplaces, employee adoption assistance, travel concierge services, company cars and mobile phone discounts.

Some of the results were similar, with health insurance deemed to be the top predictor of employee satisfaction with benefits. Vacation and paid time off, pension plans, 401(k) plans and retirement plans rounded out the top five.

Parental leave policies, however, ranked much higher in this study, with maternity and paternity leave ranking as the seventh-best predictor of employee satisfaction with respect to benefits.

On the opposite end of the spectrum, benefits and perks such as gym memberships, reduced or flexible hours, and childcare barely register on the employee satisfaction scale, coming in at 43, 50 and 53 on the list, respectively.

“Overall, the above results echo the findings of our earlier study,” according to Glassdoor. “The core benefits that matter most to workers are health insurance, vacation and paid time off, and retirement plans. These core benefits are most highly correlated with employee satisfaction with benefits packages.”

Still, Glassdoor advises caution in attempting to parse these numbers.

“These are just simple correlations between benefit ratings, and don’t statistically control for factors like company size or industry, as in our previous, more rigorous analysis of Glassdoor benefit ratings.”

Such limitations aside, the lesson that lies within these figures should be clear, according to the company.

“While less common benefits tend to dominate media coverage, employers should not neglect core benefits such as health insurance and paid time off. The data clearly show these benefits—while less exciting than many of today’s flashy workplace perks—are still the main drivers of employee satisfaction.”

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Putting Mental Well-being in a Better Place

The figure shared at this week’s IBI Forum in San Francisco is pretty jarring: Mental-health conditions are costing employers more than $80 billion in medical expenses and productivity losses per year. Yes, that’s right: $80 billion!

ThinkstockPhotos-462419617So I guess it’s not surprising that behavioral health was the focus of more than a few sessions at this year’s conference, which attracted around 500 people to the City by the Bay.

At the plenary session titled Behavioral Health and Its Impact on Productivity and the Workplace, Pacific Resources’ Vice President of Global Employer Solutions Patricia Purdy pointed out that employers still have a long way to go in their efforts to get their hands around the issue of mental well-being.

“When it comes to thinking about mental health and well-being, organizations are woefully behind,” Purdy said.

In her presentation, she referred to behavioral health as a “frontier,” adding that her word choice was “purposeful, because we’re still really on the cutting edge of helping organizations think about mental health and mental well-being.”

During a conference titled “The Productivity Summit: Improving Behavioral Health and Well-being in the Workplace,” held last May at the Carter Center in Atlanta, Purdy and others even devoted some time to talking about names, she said. “Do we call it behavioral health? Do we call it mental illness? Mental wellness? Mental well-being? Behavioral well-being?”

One of the challenges businesses face today, Purdy said, is coming up with a common lexicon that can be used to talk about the subject, in a way that’s “not threatening to employees.”

The panelists at the IBI session—which included Johnson & Johnson Chief Medical Officer Fikry Isaac; Georgetown University’s Robert Carr (director of its master’s program in health systems administration); and Sedgwick Senior Vice President of Corporate Development, M&A and Healthcare Kimberly George—also touched on making the business case for mental-health investment.

Purdy noted that people at the Carter Center summit said more data is needed to build the business case. But, she added, the truth is there’s already “scads and scads of data.”

The problem, she explained, isn’t that companies don’t have the data; it’s whether or not they can translate that data into the language of the business—so business leaders “understand what we’re talking about.”

As J&J’s Isaac put it, those in the profession need be able to explain to business leaders what’s in it for them and why health, including behavior health, matters.

Presenters also made the case for integrating mental health into other processes. Georgetown’s Carr pointed out, for example, that mental well-being is integrated into GSK’s annual employee survey. (Carr retired from the pharma company in 2014.)

The company, for instance, wanted to know if employees had the resources they needed, he said.

Also, at GSK, one of the six key leadership expectations is to “release energy in others,” he said, adding that the company helps those leaders lacking in this area to build this competency.

Behavioral health was nowhere to be found in the title of a breakout session later that morning, but it was nevertheless an important part of the discussion. The session, titled A Report from the Front Lines of Mindfulness-Based Programs: Four Years of Data from More than 100 Employers, looked at the benefits of mindfulness through the lens of a pioneering employer in this area: Aetna Inc.

As Aetna Wellness Program Strategy Lead Cheryl Jones explained, “mindfulness is about being in the present moment—paying attention to what’s happening around you in an open way.”

Since Aetna launched its program back in 2009, Jones said, it has seen a number of positive results, including a significant drop in employee stress levels.

Aetna—which uses eMindful as a vendor—also enjoys a remarkable participation rate: 13,000 of its 50,000 workers. (That compares to an average of 17 percent across all eMindful clients, reported co-presenter and eMindful CEO Kelley McGabe Ruff.)

Of course, having a CEO who is very publicly passionate about mindfulness doesn’t hurt. As some of you may be aware, Aetna CEO Mark Bertolini credits mindfulness and yoga with helping him manage his pain, following a skiing accident that almost took his life in 2004.

“Recovery is a state of mind,” he told a morning news show last year. “It’s not just a physical practice, and … if you get your mind in the right place, you can do almost anything [while] managing pain.”

Jones told the audience that Bertolini plans to announce Aetna’s next step in its mindfulness journey at next week’s Wisdom 2.0 conference in San Francisco. She said it will involve “creating a more mindful culture.” Guess we’ll have to wait until then for the specifics.

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CFOs Not Just Focused on Numbers

You might think that controlling costs is the primary concern of the nation’s chief financial officers when it comes to health benefits, but a new survey from the Integrated Benefits Institute reveals otherwise.

HCSC Social-179275875The survey, which polled 345 CFOs and other senior finance executives at some of the largest U.S. companies, shows that while cost management is a major concern, other goals also rank high — including using health benefits to attract and keep top performers and helping employees better manage their health. The survey also illustrates the big impact the Affordable Care Act has had on corporate health benefits.

Nearly half (44 percent) of the respondents cited controlling costs as the most important of their company’s top five goals for health and related benefits. However, almost as many (36 percent) selected other goals as the most important, including attracting, retaining and satisfying talent (15 percent), helping employees become better healthcare consumers (10 percent), helping enrollees become healthier (9 percent), and improving workforce productivity (2 percent).

The survey found that 24 percent of CFOs said the finance function’s role in benefits decision-making has expanded since the ACA’s passage, compared to only 5 percent who said it has shrunk since then. Cost-sharing is also on the rise since the ACA: About half the CFOs said their company is increasing its offerings of high-deductible healthcare plans for employees and their dependents and raising premium shares and out-of-pocket expenses.

The ACA has also spurred more companies to up their wellness game: More than half the CFOs said their company has enhanced its health and well-being programs since the law was enacted and more than one-third enhanced incentives for adopting healthy lifestyles and wellness-program participation.

Interestingly, CFOs who said their companies place great importance on attracting and retaining talent and improving productivity said their organizations were less likely to shift healthcare costs to employees.

The survey results demonstrate that CFOs understand the importance of health-management strategies, says IBI President Dr. Thomas Parry:

These findings go against the popular notion that CFOs demand a hard ROI from health promotion programs, and that companies are scrambling for the cheapest options. If we want to understand where companies are going with health benefits, we need to think of them within the context of business strategies beyond cutting costs.

Parry and two CFO panelists will discuss the role of health and benefits at the upcoming Health & Benefits Leadership Conference on April 1 in Las Vegas.

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The Cadillac Tax and Large Employers

Employers have held the line on healthcare cost increases for the third year in a row, reports Mercer in its just-released 2015 National Survey of Employer-Sponsored Health Plans. Nonetheless, 23 percent of large employers are at risk of hitting the Affordable Care Act’s widely despised 40 percent excise tax cost threshold in 2018 — and 45 percent are at risk of hitting it in 2022, according to the report.

Per-employee health benefits costs grew by only 3.8 percent this year, marking the third year in a row of a growth trend of below 4 percent, says Mercer. As in previous years, however, large companies fared better than smaller ones in holding the line: Costs rose by 5.9 percent for organizations with 10 to 499 employees, compared to just 2. 9 percent for those with 500 or more.

Large employers were helped by a jump in enrollment for high-deductible consumer-driven plans, says Mercer, while use of these plans among small employers has grown more slowly. At large companies, enrollment has grown from 15 percent to 28 percent of covered employees within the last three years. At small companies, however, it’s risen from 17 percent to just 19 percent.

Total health benefit costs averaged $11,635 per employee this year, Mercer finds, including employer and employee contributions for medical, dental and other health coverage for employees and their dependents. Employers predict their costs will rise by 4.3 percent on average next year, taking into account changes they expect to make to their health plans to reduce costs. They predict costs will rise by 6.3 percent if they make no changes to their plans.

Mercer credits these cost-containment (some would say “cost-shifting”) strategies with lowering the number of plans expected to be hit by the Cadillac tax in 2018. However, the report notes that a plan’s actuarial value is not the only factor that can drive up costs above the excise tax threshold. Health plan costs can vary significantly by geographic region, the degree of competition among providers in a particular market and workforce demographics, it says. Furthermore, it cautions, due to the way the excise tax threshold is indexed, the number of employers vulnerable to the tax will grow every year that medical inflation exceeds the general CPI — thus, by 2022 45 percent of large employers are estimated to be liable for the tax unless they make changes.

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Auto Workers’ Push for Pooling

The United Auto Workers is pushing for greater industry consolidation. No, I’m not referring to something along the lines of Fiat Chrysler’s CEO Sergio Marchionne’s on-again, off-again pursuit of merging with General Motors. I’m talking about employee healthcare.

ThinkstockPhotos-101922589A story in today’s Wall Street Journal titled “UAW Pitches Health-Care Co-op to Car Makers”  (subscription site) reports that the “United Auto Workers union is pushing Detroit car makers to put all their employees under one health-care umbrella, creating a powerful purchasing group that could upend traditional health-care markets.” It continues:

“The union’s idea would create a joint purchasing group for the three largest U.S. auto makers that would cover factory and white-collar workers and union-affiliated retirees. The group could total nearly 1 million members, a scale it believes would have unprecedented leverage in negotiating directly with hospitals, drug companies and others.

Assuming the idea even gets off the ground, it could take one to two years to set up and longer to generate significant savings, health-care experts said.”

As the WSJ story reports, “UAW President Dennis Williams previously has described the plan as a way for auto makers to gain more control over health-care expenses and win cost savings. He wants the purchasing group overseen by a board [consisting] of union and auto-industry executives. A prior effort to pull together employees of the three stalled in 2011 because auto makers weren’t interested in pursuing it.”

The UAW is currently negotiating a new four-year deal to replace the current contract, which is set to expire on Sept. 14.

I spoke to Steve Wojcik, vice president of public policy for the National Business Group on Health in Washington, and asked him for his take on the UAW move.

Wojcik says he can’t comment on the union’s plans, since he doesn’t know the specifics, but adds that he certainly understands where the motivation is coming from. Plans, he says, are under a lot of pressure to reduce costs, especially with the ACA excise tax kicking in in 2018.

Still, Wojcik says he isn’t convinced the UAW pooling strategy would be the most effective way to address the cost issue.

“The problem with these efforts,” he says, “is [they involve] voluntary participation—so employers with success at controlling costs or lowering healthcare expenses end up not participating and those having trouble [on these fronts do participate]. Because of this, I don’t think the track record has been that successful.”

Pooling, he adds, has typically found greater success among smaller organizations.

The WSJ story also touches on the practice of direct contracting. “One option for the purchasing pool, say people familiar with the matter, would be for it to establish ‘centers of excellence … ,” the article says. It cites Lowe’s Cos., which has a deal with the Cleveland Clinic and flies employees to Ohio for heart surgeries at no cost to the worker.

Commenting on this, Wojcik notes NBGH’s just-released Large Employer Plan Design Survey reveals that respondents put direct contracting close to the bottom of initiatives having an impact on controlling costs.

Wojcik points out that there’s probably good reason for this. A number of factors need to be in place for direct contracting to work, including the employer needs to have a “significant market power, opportunities need to exist for improving care delivery and there needs to be a decent amount of provider competition.”

“It’s not just about negotiating a discount,” he says.

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Employers and Contraceptive Coverage

In case you missed it, a federal court of appeals ruled last Friday that religiously affiliated nonprofit employers can’t block their employees’ health care coverage for contraceptives.

The ruling in Catholic Health Care System v. Burwell finds that the plaintiffs, which include Catholic health care systems and Catholic high schools, are not burdened by having to formally object to covering contraceptives for employees.

The American Civil Liberties Union  supported the government’s arguments by participating in a friend-of-the-court brief.

The decision by the U.S. Court of Appeals for the Second Circuit held that the religious accommodation in the Affordable Care Act’s contraceptive rule imposed no substantial burden on the plaintiffs’ religious freedom.

The plaintiffs challenged a requirement that employers that object to including contraceptive coverage in their employee’s insurance plans notify their insurers or the government of their objection.  The insurer must then arrange and pay for the contraceptive coverage separately.

“Today’s victory is not only incredibly important for the more than 12,000 employees who stand to gain contraception coverage, but it also sends a clear message that an employer’s religious beliefs can’t be used to deny health care benefits to employees,” said Brigitte Amiri, senior staff attorney for the American Civil Liberties Union’s Reproductive Freedom Project. “We fight hard to protect religious freedom at the ACLU, but that right doesn’t allow employers to discriminate against their female employees.”

With Friday’s decision, the Second Circuit joins six other circuits that have found that the accommodation poses no substantial burden on the nonprofits’ religion, including the D.C., Third, Fifth, Sixth, Seventh, and Tenth Circuits.  No circuit court has ruled the other way.

Viewed purely from an HR perspective, the ruling seems to be yet another small — but welcome — step toward full equality in the workplace.

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The Incredibly Shrinking Carrier Market

It’s official: Anthem announced this morning plans to purchase Cigna for more than $48 billion.

Word Cloud Merger & Acquisitions
Word Cloud Merger & Acquisitions

Coming on the heels of Aetna’s $37 billion proposed deal to acquire Humana, the Anthem-Cigna proposed merger, were it to be given the green light by regulators, would inevitably reshape the health-insurance landscape and provide employers with one less option to consider. But according to experts I spoke to earlier today, deals like the one announced this morning also have the potential of being a boon to employers and employees.

If the Anthem-Cigna transaction goes through, Anthem will have more than $115 billion in pro forma annual revenues, based on the most recent 2015 outlooks publicly reported by both companies. Anthem President and CEO Joseph Swedish would serve as chairman and CEO of the combined company and Cigna’s President and CEO David Cordani would take on the titles of president and COO.

Here’s Swedish’s take on the proposed merger …

“We believe that this transaction will allow us to enhance our competitive position and be better positioned to apply the insights and access of a broad network and dedicated local presence to the health care challenges of the increasingly diverse markets, membership, and communities we serve. The Cigna team has built a set of capabilities that greatly complement our own offerings and the combined company will have a competitive presence across commercial, government, international and specialty segments. These expanded capabilities will enable us to better serve our customers as their health care needs evolve.”

And Cordani’s take …

“The complementary nature of our businesses will allow us to leverage the deep global health care knowledge, local market talent, and expertise of both organizations to ensure that consumers have access to affordable and personalized solutions across diverse life and health stages and position us for sustained success.”

There’s been three national players for a while, with all three of them trying strengthen their portfolios through mergers, explained Tucker Sharp, global chief broking officer at Aon Hewitt in Somerset, N.J. “Someone can put out a headline that says, ‘Five carriers become three.’ But there really have been three national players and what’s happening here is really about building scale … .”

Sharp also noted that lately there’s a bit of merger one-upmanship going on between the carriers and providers. For some time now, he said, the hospitals and physician groups have quietly been merging to get the upper-hand in negotiating with the carriers. Now, much like “an arms race,” you’re seeing the insurer carriers trying to improve their leverage.

At the end of the day, he said, the operational efficiencies and greater scale gained from these mergers could lead to better deals with health providers and benefit employers.

When I asked Sharp if there’s anything HR leaders should be doing differently in light of the Anthem-Cigna news, he said nothing at the moment, noting it’s going to take time for things to work their way through the regulators. If you’re an HR executive, he added, there’s probably nothing you need to worry about for the rest 2015 and 2016.

I also asked Steve Wojcik, vice president of public policy at National Business Group on Health in Washington, for his assessment of the announcement.

His response: “There are some potential upsides and some potential downsides. In the end, we’re looking for some of the cost savings and pricing to trickle down to the employers and employees. But there also are obviously some concerns, because there are only a few players left standing—so employers that want to put their plan administration out to bid are going to have fewer bidders … .”

Wojcik predicts that the Aetna-Humana deal will probably meet less resistance from regulators than the Anthem-Cigna deal because Humana is a smaller player in the employer market, though a much bigger player in the Medicare market.

In evaluating these deals, he said, regulators need to factor in that the health insurance market is dynamic, not static. They’re going to need to weigh into their thinking, he explained, some of the new entities, such as accountable care organizations, that have emerged in recent years and the impact they’re having on the overall market.


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CDHPs Are Closing the Satisfaction Gap

employee health 1Traditional health insurance plans may still be the most popular option among employees, but consumer-driven plans are beginning to catch on with the workforce.

That seems to be the biggest takeaway from new data coming out of the Employee Benefit Research Institute.

Along with Greenwald & Associates, the Washington-based non-profit research institute recently conducted a survey of nearly 2,000 adults between the ages of 21 and 64, who had health insurance through an employer or purchased health insurance on their own, either directly from a carrier or through a government exchange. According to EBRI’s report on the findings, employees enrolled in traditional health plans are expressing greater satisfaction with their coverage than those in consumer-driven health plans, “but the ‘satisfaction gap’ appears to be narrowing.”

Generally speaking, 61 percent of traditional-plan enrollees described themselves as “extremely” or “very” satisfied with their health plans, compared to 46 percent of those in CDHPs, and 37 percent of employees enrolled in high-deductible health plans.

According to EBRI’s Paul Fronstin, however, overall satisfaction rates have been on the upswing among CDHP enrollees in recent years, while the opposite is true for those participating in traditional health plans.

Cost differences may help explain the emergence of this trend, notes Fronstin, the director of EBRI’s Health Research and Education Program and author of the aforementioned report.

Forty-eight percent of traditional-plan participants said they were “extremely” or “very” satisfied with their out-of-pocket costs when EBRI conducted this same poll in 2014. At that time, 19 percent of high-deductible health plan enrollees said the same, as did 26 percent of CDHP participants. In terms of contentment with what they’re paying out of their own pockets, satisfaction rates for all three groups have been trending upward since 2011, according to EBRI.

In addition, employees in CDHPs or HDHPs were less likely than those in traditional plans to recommend their health plans to friends or co-workers, and were less apt to stay with their current plans if given the option to switch plans—as was the case in past years, according to EBRI.

But, as the survey found on a broader scale, “the percentage of HDHP and CDHP enrollees reporting they would be extremely or very likely to recommend their plan to friends or co-workers has been trending upward,” the report notes, “while it has been flat among individuals with traditional coverage.”

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Looking to the Future for Total Rewards

It’s been 15 years since the American Compensation Association changed its name to WorldatWork, reflecting the group’s decision to increase its footprint beyond the world of compensation and embrace a broader total-rewards approach.

ThinkstockPhotos-175679126This year, the Scottsdale, Ariz.-based HR association celebrates its 60th anniversary. And with that milestone comes a revamped total-rewards model.

Announced during the opening session of this week’s WorldatWork’s Total Rewards 2015 Conference and Exposition in Minneapolis, the new model now includes the verb “engage” (which joins attract, motivate and retain in describing total rewards’ contribution to the organization) and the addition of “talent development” as a sixth element of the total-rewards strategy.

WorldatWork’s previous model, introduced in 2006, featured the following five elements: compensation, benefits, work/life, performance and recognition, and development and career opportunities.

Anne Ruddy, president and CEO of WorldatWork, noted that the time was right for the association to re-examine its total-rewards model and make it more relevant to the kinds of issues members are facing today.

Models aside, it would seem many of those attending this year’s conference have their sights set on the future. On Monday afternoon, I attended a packed session presented by Steven Gross, a senior partner at Mercer, entitled “Total Rewards 2020: What to Expect in the Next Five Years Based Upon a Lifetime of Experience.”

Five minutes before the session began, attendees were being turned away at the door because the room was already filled to capacity. (Fortunately, for those unable to attend, the session was scheduled to be repeated the following day.)

Gross, who is based in Mercer’s Philadelphia office, gave attendees a quick rundown of the external factors influencing total rewards today, a glimpse of what the future might look like five years from  now and what steps employers ought to take to prepare for that world.

As might be expected, Gross led off his presentation by acknowledging the crucial role changing workforce demographics is playing in shaping the future of total rewards.

“It’s not only about people living longer, but people working longer,” Gross said. “Think about the implications of one quarter of folks over age 65 and 15 percent of folks over age 70 in the workforce”—and the kinds of challenges these changes are going to present to employers.

Generational differences, he said, are also likely to have an impact, as employers face the formidable challenge of addressing “the different sensitivities” of traditionalists, baby boomers, Gen Xers and millennials.

Other external factors Gross cited included income disparities, diversity, globalization and technology.

Gross predicted that, five years from now, companies will be much more focused on “core employees” who are viewed as being crucial to their organization’s success, will continue to put more weight on individual accountability, and will pay greater attention to personalizing rewards to reflect greater workplace diversity.

Going forward, he said, companies will also be much more focused on “best fit rather than just best practice.” (In other words, he explained, does your total-rewards strategy fit the culture of your organization?)

What’s more, he added, do-it-yourself benefits programs will be far more common five years from now, with self-service becoming an even greater fixture of tomorrow’s workplace. (Gross also joined the chorus of those predicting employers will increasingly be getting  out of the “healthcare business.”)

I suppose we’ll know in five years which of Gross’ predictions were on target—and which ones missed the mark.  But of this we can be fairly certain: Tomorrow’s total-rewards landscape isn’t likely to look anything like the one that exists today. As Gross reminded those attending his session, there are simply too many significant forces at work to ensure that that’s the case.

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The Pitfalls of Consumerism

Do you put as much thought into selecting your cellphone plan as you do for selecting which doctors and specialists to see for your medical plans?

This question was posed at the National Business Coalition on Health’s annual conference in Washington by Shawn Leavitt, senior vice president of global benefits at Comcast Corp., during his keynote address.

“More than half of all consumers say they’re dissatisfied with the cellphone plan they chose,” he said. “So, if people are having a hard time selecting a cellphone plan that’s right for them, then how do we expect them to make the right decisions with respect to their health plan and health providers?”

The subject of Leavitt’s presentation was that healthcare consumerism — high-deductible plans that put more of the onus for financing and managing healthcare on employees — will not work unless employees receive more expert direction and guidance to help them.

At Comcast, said Leavitt, HR has enlisted so-called “expert shoppers” to help employees with these crucial decisions. It’s coupled that with outreach to certain locations within its vast empire to focus on subsectors — such as call centers — where employees were making heavy use of emergency rooms (and driving up costs) to educate employees on alternatives such as urgent care centers.

“We understand that it’s hard to expect employees who are juggling multiple responsibilities to make the sort of far-sighted decisions we’d like them to make when they’re faced with something as immediate as a sick child,” said Leavitt.

Comcast is using its own marketing wizardry to help educate employees on making wiser healthcare choices, he said. “We have become very good at getting consumers to pay to watch bad movies and reality television shows,” said Leavitt. “We’re focused on bringing that same level of expertise to help our employees make good decisions on healthcare.”

The risks of consumerism were also highlighted by Dr. Mark Fendrick during a panel discussion on pharmacy drug benefits. One of the main questions the panel grappled with was whether it was right for plan sponsors to exclude certain medications from plan coverage.

“If you’re doing that just to save money, I don’t think it’s a good idea,” said Fendrick, director of the University of Michigan’s Center for Value-Based Insurance Design. “I think it’s OK if the drug has been proved to be ineffective or counterproductive or if cheaper generics of equivalent effectiveness are available. But do it for the right reasons.”

The trend of pushing more costs onto employees can end up doing more harm than good if it isn’t managed carefully, he said. “Raising deductibles and pushing more of the cost onto employees without giving them support necessary for needed treatment and medications will simply cause more of them to forgo what they need,” he said. “I’ve had patients tell me that until they exhaust their deductible, they’re not going to do many of the things I’ve told them they need to do to maintain their health. And that goes against what this whole idea of consumerism is supposed to be about.”


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