What comes to mind when you hear the words innovation and technology? For me it’s flying cars, floating skyscrapers, and spaceships; how cool would that be to look down over Mars as you fly by in your Spacebender 3000? We have now reached the year 2019 and still don’t have the flying cars we remember from the Jetson cartoons, but never fear, I’m sure Elon Musk is working on this (unless Richard Branson gets to it first). Although we are not yet star trekking through the atmosphere in our private spaceships, we are making tremendous advancements in the healthcare industry. New ideas, new technologies, some great, some just for fun, but all leading to better programs for employers and their employees. Why is such advancement important to us? It is important because the costs of healthcare are projected to reach $8.7 trillion dollars by the year 2020…Yes, I said $8.7 trillion. Not to mention, the current healthcare inflation rate is right around 6.5% annually which is more than 3 times that of the U.S inflation rate of 2% – don’t you think this is a problem worth solving? I would imagine so, and if you think the increases outlined above are not going to be directly reflected in our insurance premiums, then you’re just as naive as I was when I thought I would be driving a flying car at the age of 16.
Lucky for us it is the year 2019 and innovators are using new technology solutions to help soften the risk of high healthcare prices and premium rate increases in the most creative ways. Recently there was no better place to be as an innovator than at the Consumer Technology Association’s (CTA), CES 2019 annual showcase. This event is one of the largest technology conferences in the world and has been taking over the Las Vegas strip for years; it serves as a proving ground for innovators in the business of consumer technologies. This year the WSJ reported that there were 511 companies that represented the digital health sector, up from 472 last year. Featured products included wearables that track blood pressure and heart rhythms, as well as home sperm fertility tests, making home health technology a significant topic of conversation. What better way to cut healthcare costs then to have consumers do blood tests and health monitoring in the comfort of their own home, eliminating the need for an outrageously expensive office visit where we have no idea what we are being charged for.
Innovation in healthcare and insurance are one in the same – after all, health insurance is just the financing mechanism to the healthcare delivery system. The days where we spend countless hours researching our next flat screen TV, yet only 15 minutes deciding where and who we are going to for a surgery, must meet their end. As an employer you have to be excited about the innovative new solutions that will help limit your insurance premium increases. Let’s take a look at some of the cost containment strategies that are trending in today’s market.
- Employers can now manage the health of their population with fun wellness programs and friendly office competitions by using wearables like Fitbits to count steps throughout the office. The phones in our pockets are more than just telephones; now our phones can be used for telemedicine, allowing employees to have a virtual visit with their doctor instead of going in for an office visit.
- Relationships are being formed between physician offices and employers to establish a Direct Primary Care solution; this is a unique model where a monthly membership fee is paid to the provider as opposed to individual bills being sent for every office visit and service that is incurred.
- We all know healthcare is confusing, but now with enhanced data management and collection, companies are aggregating pricing and claims information. Pricing Transparency companies and others are using this centralized data to provide employers and their employees with the tools to be better educated consumers for where they get their care and at what costs. Think about the impact you can have on the cost to your company by decreasing the amount of times an employee goes to the emergency room instead of urgent care, or going to a provider charging $500 for an MRI instead of $5,000.
- Analytics are shifting the models in which we pay for healthcare. Reimbursements can now be results based instead of paying for every service or piece of equipment that is used when delivering care. When you bought your car, did you purchase the brake pedal, steering wheel, and the wiring? I didn’t think so, you purchased the car itself not every single component of the car separately; so why don’t we purchase healthcare in this manner? Employers can implement a bundled payment program to purchase a service at a single price eliminating the 200 different bills that would be received in the traditional fee-for-service model.
We welcome change in the marketplace, especially when it ignites industry growth and innovation. Employers, you now have the opportunity to provide world-class benefits and choices to your employees by implementing these unique strategies that will ultimately help drive down the cost of your insurance premiums.
When shopping for a cost containment program, question whether it’s the right one for you – every employer is unique and will have different needs specific to its population. The program should align with your company’s financial goals and most importantly, it should account for the type, location, wage, and other attributes of the employees. If you are an employer working with a Third Party Administrator (TPA) or a carrier, vet whether they have the tools, flexibility, and integration capabilities to implement these strategies. You will need to set priorities for your employees and stand by them unfailingly. If you don’t buy-in, why will they? Start reviewing the current benefit strategies you have in place. What is your average premium increase, and what are you doing to manage that increase each year?