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Employers Rethinking Benefits to Get Bigger Bang for Buck

By MBGHConnect Community posted 11-10-2015 11:25 AM


November 3, 2015

MBGH survey finds employers committed to improving the health of their covered populations

CHICAGO – While the vast majority of employers (76%) are focusing their health benefit strategies on avoiding the 2018 Affordable Care Act excise tax, a greater number indicated that increasing employee engagement in health improvement programs (81%) and using preventive services (77%) are priorities for 2016-2017. These are among the findings of an annual survey of 119 employers by the non-profit Midwest Business Group on Health, one of the nation’s leading business groups of private and public employers representing over 4 million lives, and spending more than $4 billion on health care benefits annually.

To ensure they are getting the most value for their health care dollars, employers are implementing a number of key strategies to manage their company’s health benefits and taking steps to encourage their employees to better manage their health,” said Larry Boress, MBGH president and CEO. “The business community continues to believe health care benefits are an investment in their human capital, and they’re seeking effective and innovative approaches to deal with their largest expense outside of payroll.

Key findings:

  • For the past three years, managing specialty drugs (61%) and creating a culture of health (60%) were noted as employer priorities. When asked about their expected excise tax timeline, 47% indicate they will reach it beyond 2019, while only 18% expect to reach it in 2018 when the tax is set to begin.
  • Top strategies employers currently have in place to avoid the excise tax include increasing the availability of wellness programs, offering high deductible plans, adding or expanding incentives for employee wellness programs, and increasing employee cost share. Employers indicated they also plan to optimize networks for best providers and reduce benefits.
  • When asked about plans to offer private exchanges to their workers, employers largely indicated that they will not consider this strategy through 2016 (79%); however, the percent of employers who say they won’t consider this strategy decreases dramatically in 2017 and 2018 to 44% and 29% respectively.
  • Almost 50% of self-insured employers identified outcomes-based incentives as a priority.
  • When it comes to offering high deductible plans, 54% of employers will make this available. Employers still believe HMOs and PPOs will remain viable because they want to support employees that are in lower salary tiers.
  • A majority of employers (80%) are not yet sure if increasing cost share for employees will be higher or not by 2017, and 21% have indicated they plan to remain at 70/30, with only 6% moving to a higher cost share of 50/50.
  • When asked if they plan to offer benefits in 2025, 60% said yes and 40% said they don’t know. This will be influenced by peer company actions (75%), government mandates (71%), and labor market pressures (61%).
  • Telemedicine, viewed as a means of increasing access and reducing unnecessary absences in order to get care, will be a priority for 46% of employers.
  • While 81% will cover same-sex married couples in 2016, only 53% plan to cover domestic partners. In 2017, employers covering domestic partners drop to 41% in 2017, which may be due to the Supreme Court’s decision recognizing same-sex couple marriages across the nation and making a domestic partnership a less meaningful relationship for benefit purposes While 98% of employers have some policy covering workplace violence, only 36% have policies specifically related to domestic or intimate partner violence.
  • By 2017, over half of employers (56%) plan to contract directly with a center of excellence, while 47% expect to offer narrow, high performance provider networks to their workers.

MBGH, in cooperation with other business coalitions, polled 119 national mid- to large-sized employers in a wide variety of industries including manufacturing, financial services/consulting and health care. Employer size varied with 32% having more than 10,000 employees, 17% having 5,000-10,000 and 51% less than 5,000. A summary of survey results can be found here

About the Midwest Business Group on Health

With more than 130 member organizations, the Midwest Business Group on Health is one of the nation’s leading non-profit business groups of large, self-insured public and private employers serving as a catalyst for community initiatives to improve the quality, safety and cost-effectiveness of the health care delivery system. MBGH is an essential resource to support employers in effectively managing their health benefits through high-quality education, research, networking and benchmarking. MBGH is a founding member of the National Business Coalition on Health.

For further information about this release and MBGH, contact: Cary Conway, Media Consultant