Given the timing of the year (close to the July 4th holiday) and focusing on title alone, welcome to my blog about the number of hot dogs I can eat in one sitting! Kidding, this is actually a blog about all the different ways to grill mayonnaise. Okay, again, maybe I type in jest as anyone who knows me knows I would sooner walk a tight rope over the Grand Canyon with no safety harness than eat said referenced condiment…let alone grill it!
Actually, the thoughts I had around “appetite” focus more on the employer market and their appetite for change. I work on the Employee Benefits side of our consulting practice and focus primarily on large, self-funded clients. Given the timing of the year (no, not mayonnaise grilling season), our teams have been immersed in design and strategic planning for our client partners. A key tenant to these strategy sessions and one of the core drivers as you might imagine is budget. Given the pressure on cost, the volatility in high claims, and the current trend of 8 percent on medical and 11 percent on Rx, these strategic planning sessions have been anything but linear.
Employers are looking for concepts that will help their employees, protect their employers, and truly have an appetite for new ideas and direction. Cost shifting to employees doesn’t seem like the answer as the labor market is anxious and, in many sectors, highly competitive. Going back to the CFO with a trend increase (or worse…given exposure to high claims) is also not selling a lot of tickets.
Given this appetite for change, here are a few of the concepts that have been discussed with clients in the last two weeks alone:
- Cash pay
- Reference-based pricing
- Narrow network
- EPO
- Direct contracting
- Payment as a percent of Medicare
While there’s nothing magic about the list above (and many are concepts you’ve most likely heard before), the thing that makes this year unique is the action around these concepts. No longer are they discussion points at the end of a presentation with a “let’s wait to see what our competitors do” response from our clients. These concepts are leading the conversation and the appetite for action…and in many cases, implementation is upon us. Where once employers stood on the sideline concerned about disrupting their employee experience, the worm has officially turned and they now embrace this change. A renewed focus on engaging employees through communication and letting them know these changes are coming, they’re necessary for the sustainability of their business (whatever business that might be), and they’re part of the new world order in healthcare seems to be the rally cry this year.
What a shift in deductible or a premium increase represented five years ago looks far more like a narrowed selection of hospitals or an in-network only strategy today. Employers are forced to make these changes, and the appetite for new ideas is insatiable.
Healthcare is anything but stagnant, and employers don’t have the luxury to wait and see “what’s next” from Capitol Hill. We must be nimble, we must be purposeful, and we must iterate as this dynamic time in healthcare calls for a dynamic appetite for evolving change.
If you have questions on this, please don’t hesitate to reach out to me by commenting below, calling, or emailing. Until then, have a great upcoming holiday with family and friends, and if you so desire, go ahead and throw some mayo on the grill…you’ve earned it.
