Learn How Your Business Can Take Advantage of Changes in the Healthcare Landscape
Employee health benefits are the second largest expense for U.S. employers, right behind paying wages. In the last ten years, businesses have gone from being upset to see an increase at renewal, to now – just hoping the increase isn’t that bad. We still hope for good renewals, but the entire spectrum of healthcare seems to become more expensive every year – for both the employer and the end user.
There’s been a big focus on being smarter healthcare consumers as these costs continue to skyrocket. The simplest idea hones in on helping the insured understand the cost difference between an Emergency Room (ER), an Urgent Care, and a primary care physician (PCP). The problem is – (and forgive us, the stats are all over the map on this one) around 25% of Americans don’t have a PCP. There’s likely some overlap of those who don’t have a PCP and those who would go to the ER for an ailment that could be handled in a clinic, or even from home.
Prior to 2020, telehealth seemed almost like a luxury – for CEOs with busy schedules, or the very tech-savvy. Fast forward to 2022, and people are inconvenienced by not being able to do everything virtually. Many of us are click-listing groceries like a pro now, and will gladly make telehealth appointments to save on time (and gas). So many healthcare consumers have jumped on the bandwagon that telehealth visits are now 38 times what they were in February 2020[1]. Out of necessity, patients and providers got on board with telehealth – and it’s been a boon for healthcare costs. From an employer’s perspective, educating those on your plan about telehealth is a win-win. Some have pointed out that telehealth will decrease time that employees spend away from the office for appointments of their own, or dependent care. However, the issue of employee burnout tells us that promoting telehealth to keep employees from leaving the workplace isn’t going to win anyone over. Here’s where employers can win: cost savings that you’ll see a quick return on, and maybe more down the road.
The first savings is simple – unnecessary ER visits cost 10x more than an Urgent Care visit, but they’re also 16x more than an average telehealth visit[2]. Now you’re dealing with a claim around $140, instead of an ER visit that averages $2000. Getting out of the “ER for everything” mindset that some consumers have will require buy-in from users, as will the other half of the equation. This is an opportunity to remind plan participants that when they’re smarter healthcare consumers, it can mean better renewals, which translates to keeping premiums affordable.
90% of healthcare costs in the U.S. can be attributed to chronic conditions[2] like hypertension, diabetes, heart disease, arthritis and asthma. If telehealth services are used to augment (not necessarily replace) traditional office visits, we can end up with more compliant patients who can manage a great deal of their care on their own. In the long run – engaged, informed, healthy patients cost less.
If you haven’t discussed the benefits of telehealth with your employees, here are some things to consider:
- As with anything else you expect of your staff, management should also be ready to get on board with this effort. Don’t ask your staff to do something you’re not willing to do yourself.
- Don’t assume that all of your plan participants have access to and are comfortable using the technology required for telehealth. Sure, all you need is a smartphone – but many people will need some coaching from there. Even those who consider themselves pros at telehealth visits by now still have moments of frustration when navigating a new provider’s system for the first time.
- Educate and coach! Show them the cost of an ER or Urgent Care visit vs. telehealth. Even if they’re on a low deductible plan – a percentage of that bill will probably still be their responsibility. Explain that it’s a good idea to find a PCP, but even if they don’t have one when they get sick – there are still telehealth options. Take advantage of programs and educational tools that your broker or carrier may offer, too.
There isn’t a singular answer to reducing benefit & healthcare costs for employees and employers. Educating employees and empowering them to use tools like telehealth is just one way to help control benefit costs. Many of the problems lie within the system itself, including the insurance industry and the larger healthcare conglomerates. Make sure you have a broker that’s advocating for you and shopping certain lines when necessary. If you’re a smaller employer and aren’t getting the attention you deserve, seek out a broker that specializes in your company’s size or industry. Fully-funded plans offer only so much value, control, and most importantly, transparency. Employers can also explore level-funded plans, captives or even self-insured options, depending on their appetite for risk.
[1] McKinsey & Company- Telehealth: A Quarter Trilling Dollar Post-COVID 19 Reality.
[2] Changes in Healthcare Delivery (webinar), Dayton Business Journal Aug 2022
