HealthCare Consumerism Solutions - 2016 1st Quarter Issue

2016 Private Exchange FORUM Dallas Conference Guide

ISSUE || First Quarter • 2016

What Should You Do About Cadillac Tax Delay?

A Look at the Growing Employer Market for Telehealth Why Wellness Programs Often Fall Short

INSIDE:

Innovative Health and Benefit Management

Meeting Employers’ High Expectations for Health Care Consumerism The Official Magazine of

www.theihcc.com

As a leading administrator of Consumer-Directed Benefits, WageWorks provides employee programs that deliver corporate tax savings while helping employees manage everyday expenses.

For Health Savings Accounts, Flexible Spending Accounts, Health Reimbursement Arrangements, COBRA, Commuter Benefits, Wellness Programs and other types of employee programs, we make Consumer-Directed Benefits easy to understand and use— empowering employers, employees and their families to lead happier, healthier and more productive lives.

Visit us online at www.wageworks.com.

Š2016 WageWorks, Inc. All rights reserved.

INSIDE

FEATURES 37 Meeting Employers’ High Expectations for Health Care Consumerism Self-funded employers have high expectations for health care consumerism. As part of those expectations, they want their employees to have an easy-to-use tool to become active consumers who find out what health care costs before getting treatment. They want to effectively promote the tool so employees know they have options. And they want to know how and when consumers are using cost information as part of their decisions about where and when to seek care.

By Cheryl DeMars, President and CEO, The Alliance

41 Cadillac Tax Delay Provides Opportunity for Employers to Refocus Benefit Strategy

istock.com/wildpixel

The Alliance set out to meet these needs by creating the Find a Doctor site. The Alliance is a cooperative of more than 240 employers who self-fund their health benefits in Wisconsin, Illinois, Iowa and Minnesota.

When Congress late last year postponed implementation of the Cadillac Tax, many employers welcomed the news. The two-year delay — it is now scheduled to begin in 2020 rather than 2018 — gives companies more time to find ways to reduce their exposure to the tax.

But the delay, by itself, does nothing to address ongoing cost pressures that are squeezing employers’ benefit plans. Indeed, the moratorium is unlikely to curtail many of the cost management strategies they’ve already implemented because, tax or no tax, employers must still contain medical spending. istock.com/Rawpixel Ltd

Although experts are still debating whether the Cadillac Tax will become a reality in 2020, employers are exploring a variety of ways to minimize its impact, according to a survey completed last fall of large companies by Optum and The National Business Group on Health.

By Seth Serxner, PhD, MPH, Chief Health Officer, Optum

INSIDE The Industry’s Only Magazine Dedicated Exclusively to Health Exchanges HealthCare Exchange Solutions HealthCare Exchange Solutions helps you understand the choices in the health and benefit marketplace and make the best decisions among a complicated array of exchange solutions options.

Coming up next: In late March, we will publish our 2016 HealthCare Consumerism Outlook magazine, a special annual edition that provides readers with expert outlooks for the year ahead in many areas in health care and benefits. This year’s issue will provide insights around private exchanges, workplace wellness, telehealth, compliance, voluntary benefits, quality transparency and much more.

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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INSIDE 6

Publisher’s Letter

8

Bachman’s Banter

DEPARTMENTS 15 VOLUNTARY BENEFITS Health Care Benefits Don’t Stop at Insurance

By Stephanie Shields, VP of Product and Marketing, Aflac Group Insurance

9, 12-13 Briefs & Innovations t t t t

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33 ACA COMPLIANCE Making the Most of the Cadillac Tax Delay

By Kami Haynes, Director of Marketing, Tango Health

10-11 Private Exchange FORUM Show Guide 48-50 Affiliate Member Profiles

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34 WORKPLACE WELLNESS Why Wellness Programs Often Fall Short

50 Resource Guide/Ad Index

By Jeff Brizzolara, PhD, MPH, Chief Clinical Officer, Viverae #SJ[[PMBSB

SIGN UP TO ATTEND

35 DIGITAL HEALTH The Power of Personalization for Company Wellness Programs

Events Private Exchange FORUM Dallas: February 23-24, 2016 Embassy Suites Frisco

IHC FORUM & Expo

By Steven Willey, MD, Chief Scientist, YouPlus Health

44 TELEHEALTH A Look at the Growing Employer Market for Telehealth

Atlanta: May 24-26, 2016 Cobb Galleria Centre

By Mary Modahl, Chief Marketing Officer, American Well

Private Exchange FORUM

Baltimore: September 8-9, 2016 Renaissance Harborplace Hotel

IHC FORUM West

.PEBIM

46 EMPLOYEE ENGAGEMENT Enabling Members to Be Responsible Benefit Utilizers

Las Vegas: November 9-11, 2016 Red Rock Resort Spa & Casino

By Bill Gaynor, Chief Strategy & Growth Officer, SpendWell Health

Come LEARN, CONNECT and SHARE with the top thoughtleaders in health care consumerism. Find more information at: www.theihccforum.com

ONLINE EXCLUSIVE

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(BZOPS

47 HEALTH CARE COSTS

Why Employers Should Focus on Financial Wellness in 2016

Case Study: Helping an Insurer Save Over $450,000

By Jess Maxwell, Marketing Manager, copatient

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The harsh reality is that the majority of working Americans are already living paycheck to paycheck, and it’s about to get worse.

Unfortunately, due to the Affordable Care Act, many employers have seen huge increases in their health care premiums and have no other option except to shift more of those health care costs onto their already financially stressed employees.

By Denise Winston, Financial Expert, Author and Founder, Money Starts Here 4 First Quarter 2016 * XXX 5IF*)$$ DPN * HealthCare Consumerism Solutions™

istock.com/Sujaimages2

Most of us are no strangers to financial worries, especially in today’s economy. In the workplace, however, there’s a growing concern that needs addressing: the impact of financially stressed employees on their employers.

Blue Directions

SM

An Integrated Benefit Solution

What can Blue Directions do for you?

Blue Directions is an online benefit platform that helps employers simplify benefit administration and provides employees with a personalized enrollment experience.

We help employers: Streamline administrative tasks related to benefit enrollment Offer their employees more benefit options including medical,* dental, vision, life, disability and more**

We help employees: Easily enroll in benefit plans through our online marketplace

To learn more, go to

bcbstx.com/blue-directions

Become smarter health care consumers through education and support before, during and after enrollment

* Employers select three to five different medical plans from a menu of up to 50 standard options. ** Offerings include products from Blue Cross and Blue Shield of Texas, as well as from other independent or separate companies.

A Division of Health Care Service Corporation, a Mutual Legal Reserve Company, an Independent Licensee of the Blue Cross and Blue Shield Association

731121.0216

LETTER

PUBLISHER www.theihcc.com VOLUME 12 NO. 1 | FIRST QUARTER 2016

A Curve Ball to Start the New Year

Published by FieldMedia LLC 292 South Main Street, Suite 400 Alpharetta, GA 30009 Tel: 404.671.9551 • Fax: 770.663.4409 CEO

Doug Field 404.671.9551 ext. 101 ¡ dfield@ theihcc.com CHIEF MARKETING OFFICER

What to do about the Cadillac Tax? After years of preparing for the 2018 implementation of the Affordable Care Act’s 40 percent excise tax on “high-cost health plans�, employers were thrown another curve ball in December when the administration announced a two-year delay of the controversial tax. Given the delay, many industry insiders now believe we may see full repeal. Others are pushing for changes — notably a carve-out for health savings accounts — to be made before the tax eventually goes into effect in 2020.

In this issue, the Cadillac Tax is one of the many issues that takes center stage as employers once again re-assess benefits strategies. Expert contributors from Tango Health and Optum both look at what employers should do in the midst of this wavering tax.

Also in this issue, Cheryl DeMars at The Alliance looks at how her organization — a group of mostly Wisconsin-based employers — has implemented a price/quality transparency tool for members.

As one of the cornerstones of health care consumerism, price/quality transparency continues to evolve and improve in its usefulness and user-friendliness. In this feature, DeMars provides a detailed account of implementation and how they drove member engagement with their new tool.

Elsewhere in this issue, contributors look at the latest insights in workplace wellness, digital health, telehealth, voluntary benefits, employee engagement and more. As we kick off a new (and hopefully successful) year, I hope you find the insights herein of value.

As a reminder to all of our readers, our flagship conference — the IHC FORUM & Expo — is just around the corner in May. If you’d like to join us at our largest event in Atlanta, we invite you to register now as $99 super saver rates are currently available. I hope to see you in Atlanta.

Andrew Dietz adietz@theihcc.com MANAGING EDITOR

Jonathan Field 404.671.9551 • jfield@theihcc.com SENIOR EDITOR

Heather Loveridge hloveridge@theihcc.com RELATIONSHIP MARKETING MANAGER

JJ Atherton jjatherton@theihcc.com DIGITAL MARKETING MANAGER

Eric Bruce ebruce@theihcc.com ART DIRECTOR

Kellie Frissell 404.671.9551 ext. 107 ¡ kfrissell@fieldmedia.com CHAIRMAN OF IHC ADVISORY BOARD

Ronald E. Bachman, CEO, Healthcare Visions EDITORIAL ADVISORY BOARD

Kim Adler, Allstate; Diana Andersen, Zions Bancorporation; Bill Bennett; Doug Bulleit, DCS Health; Jon Comola, Wye River Group; John Hickman, Alston+Bird LLP; Tony Holmes, Mercer Health & Benefits; Marc Kutter, Aflac; Sanders McConnell, TSYS Healthcare; Roy Ramthun, HSA Consulting Services LLC; John Young, Consumerdriven LLC WEBMASTER

Tim Hemendinger timh@fieldmedia.com DIRECTOR OF CONFERENCE SPONSORSHIP/ CORPORATE MEMBERSHIP/REPRINTS

Rogers Beasley 404.671.9551 ext 109 ¡ rbeasley@fieldmedia.com ACCOUNT MANAGERS

Michelle Gatehouse 404.405.3007 • mgatehouse@theihcc.com

Sincerely,

PARTNERS/ALLIANCES

Joni Lipson 800.546.3750 ¡ jlipson@fieldmedia.com

Doug Field CEO/Publisher dfield@fieldmedia.com

HealthCare Consumerism Solutions™ Volume 12 Issue 1 Copyright Š2016 by FieldMedia LLC. All rights reserved.

HealthCare Consumerism Solutions™ is a trademark of FieldMedia LLC. HealthCare Consumerism Solutions™ is published six times yearly by FieldMedia LLC., 292 South Main Street, Suite 400, Alpharetta, GA 30009.

Periodical postage paid at Alpharetta, GA and additional mailing offices.

TO SUBSCRIBE: Make checks and money orders payable to HealthCare Consumerism Solutions ™ magazine 292 S. Main Street, Suite 400, Alpharetta, GA 30009 or visit www.theihcc.com. Non-qualified persons may subscribe at the following rates: single copy $7.50; $75.00/yr in the U.S., $105/yr in Canada and $170/yr international. Please contact FieldMedia at 404.671.9551 or subscriberservice@fieldmedia.com for name/address changes.

PRINTED IN THE U.S.A. HealthCare Consumerism Solutions™ is designed to provide both accurate and authoritative information with regard to the understanding that the publisher is not engaged in rendering legal, financial, or other professional service. If legal advice is required, the services of a professional adviser should be sought.

The magazine is not responsible for unsolicited manuscripts or photographs.

Send letters to the editor and editorial inquiries to the above address or to jfield@fieldmedia.com. Permission to reuse content should be sent to jfield@ fieldmedia.com.

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People empowered We provide technology-enabled enterprise solutions that empower people to improve their health behaviors and make smarter healthcare decisions.

Want meaningful engagement and real results?

Visit us at RedBrickHealth.com/ShowMe or email us at ShowMe@RedBrickHealth.com.

BACHMAN’S BANTER

BY RONALD E. BACHMAN FSA, MAAA CHAIRMAN, EDITORIAL ADVISORY BOARD THE INSTITUTE FOR HEALTHCARE CONSUMERISM

Affordable Care Act Taxes Delayed WHO: The delay or elimination of several PPACA taxes and funding of programs will potentially affect anyone with individual, group or other forms of health insurance, whether self-insured or fully insured.

3.

WHEN: Signed into law on December 15, 2015. Effective dates vary: 1.

2.

3.

4.

5.

40 percent excise tax on high-cost insurance (“Cadillac� Tax) – delayed initial start January 1, 2018 to January 1, 2020.

2.3 percent excise tax on certain medical devices – eliminated for 2016 and 2017.

Health insurance provider fee (“premium tax�) – eliminated for period 2017.

Risk corridor payments to insurers – restrictions on use of federal funding.

Independent payment advisory board (“death panel�) – defunded Medicare board for 2016.

WHAT: The Consolidated Appropriations Act of 2016 made several key changes to PPACA taxes and program funding. The law delays and temporarily eliminates certain taxes initially used to fund PPACA. The loss of tax revenue does not affect PPACA benefits; it only tends to increase the projected federal budget deficit.

EXECUTIVE SUMMARY: 1. The Cadillac tax was to go into effect on January, 1 2018. While heavily relied on to initially fund PPACA, there is bipartisan support to eliminate or minimize the impact of the 40 percent surcharge on high cost plans exceeding specific cost levels. The two-year delay is an indication that future delays or outright repeal is likely.

2. The excise tax on certain medical devices was originally imposed on the medical device industry as a trade off for expanded coverage of insurance under PPACA. It has been in effect since January 1, 2013. The impact of the industry is controversial. Some believed

4.

5.

it only increased costs of needed items such as artificial joints and heart pacemakers. The tax has been eliminated for 2016 and 2017 but could be reinstated in 2018.

The health insurance provider fee (PPACA premium tax) is charged only on fully insured health plans. It has been in effect since 2014. The fee has been eliminated for one year (2017) and will automatically be reinstated in 2018 unless further legislation is enacted.

Under the 2015 omnibus law, risk corridor payments were limited to the fees that the program collects from insurers that have excess profits. If the excess profits payments are insufficient to offset losses from others, no additional government funding is allowed.

Those restrictions were again placed in the 2016 Appropriations Act. Independent (Medicare) payment advisory board, or death panel as some have referred to it, was not funded under the 2016 Appropriations Act. The Medicare advisory board has never been selected. The PPACA law gives HHS authority if the IPAB does not exist or make recommendations.

ACTIONS: Employers need to factor in the uncertainty of a Cadillac Tax delay rather than repeal. Insurers need to consider lowering premiums from the delay in the provider fee. Insurers need to decide whether or not to offer products without the financial safety net of a federally supported risk adjuster.

Medical device companies need to consider lowering prices during the moratorium on those taxes. Government agencies and watchdog groups will be checking to see if consumers realize lower costs from the elimination of these indirect taxes.

The law delays and temporarily

eliminates certain taxes initially used to fund PPACA. The loss

of tax revenue does not affect

PPACA benefits; it only tends to increase the projected federal

The information presented and contained within this article was submitted by Ronald E. Bachman, president and CEO, Healthcare Visions, and chairman of the Editorial Advisory Board at The Institute for HealthCare Consumerism. This information is general information only, and does not, and is not intended to constitute legal advice. You should consult legal advisors to determine the laws and regulations applicable to your company. Any opinions expressed within this document are solely the opinion of the individual author.

budget deficit.

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HEALTHCARE CONSUMERISM NEWS BRIEFS

Doctor On Demand Signs 400th Employer Customer Doctor On Demand announced recently that it has signed its 400th employer customer, bringing the total number of Americans covered by the service by their employers or health plans to more than 45 million. Doctor On Demand offers the highest-rated telemedicine solution for reducing employer health care costs. The company has experienced tremendous customer growth in 2015. Four of the Fortune 10 and many industry-leading companies — such as American Airlines, Lennox International and Aggreko — have signed up with Doctor On Demand in the last year. Doctor On Demand offers video visits with physicians and psychologists, delivered through patients’ smartphones or computers in an easy-to-use application. Employers can integrate the telemedicine service with any health plan they currently use, and there are no up-front costs, PEPM fees or subscription fees, maximizing the cost-savings.

CoPatient Launches Simplified Health Care Expense Management Solution for Employers, Plan Sponsors CoPatient, a health care expense management company, announced its new offerings for employers and health plans. The new services help to engage consumers on health care expenses and reduce overall health care costs. As medical costs continue to rise, the industry has continued to incorporate additional consumer cost-sharing and narrow provider networks. CoPatient’s new services include employer-sponsored medical bill negotiation and out-of-network claims management to directly address these two trends on behalf of consumers, employers and health plans. Employers can now offer additional protection from high out-of-pocket costs and billing errors to their employees through CoPatient’s subscription-based medical bill negotiation service.

Empyrean Partners with WageWorks to Provide Consumer-Directed Benefits to Clients Empyrean Benefit Solutions, a Houston-based provider of benefits administration technology and services, announced a channel partnership with WageWorks. The agreement enables WageWorks to administer commuter benefit, COBRA and direct-billing services for clients of Empyrean. Empyrean offers enrollment, eligibility management and a range of other plan administration services to employers, insurance brokers and health care exchanges. The new partnership enables Empyrean to offer WageWorks’ expertise, premier technology and enhanced services to its clients, which represents more than two million employees.

BioIQ Partners with eDoc4u to Enhance Health Care Technology Platform Health care technology company BioIQ and population health manager eDoc4U announced an integrated solution to personalize screening, wellness and population health programs with targeted education.

Employers and health plans use the BioIQ technology platform to engage individuals, gather biometric data, display lab results, track rewards/ incentives and direct people to targeted, personalized interventions based on their unique health risks and needs. eDoc4U complements the BioIQ platform by delivering targeted, risk-based recommendations for health improvement, along with personalized education curricula and toolsets for topics and conditions spanning the health continuum — from well-being and stress management, to smoking cessation, diet/ weight loss and chronic condition management. The combination

of these capabilities differentiate BioIQ’s participant experience and strengthens its value to connect participants with health care resources, help them measure their health and ultimately enable them to achieve their optimal well-being.

Over 200 Organizations Receive Health Champion Designation Through Nationwide Wellness Initiative The American Diabetes Association has launched Wellness Lives Here, a new initiative that focuses on employee and community wellness by working with organizations to inspire and fuel healthful habits at work and beyond. One aspect of the initiative, the Health Champion Designation, recognizes companies for their efforts in implementing wellness programs and improving employee health. Two hundred sixty-two companies, organizations and communities across the U.S. — ranging from hospitals and trucking companies to school districts and nonprofits — have already been designated Health Champions, and more companies are applying every day. These organizations have implemented a culture of wellness that provides healthier food choices at work, promotes group participation in physical activities such as organized walks and encourages other healthy habits such as taking the stairs. The criteria for becoming a Health Champion Designee include nutrition and weight management, physical activity and organizational well-being. Sun Life Financial is the exclusive national sponsor of Wellness Lives Here.

Dominion Adopts WiserTogether Platform to Improve Employee Health Care Decision-Making WiserTogether announced that Dominion Resources, Inc. will offer Wiser Health to its employees and their dependents. The company’s Wiser Health product is a treatment decision-support solution that provides health consumers with comprehensive information on prevalent medical conditions and treatments. The Wiser Health solution brings together clinical evidence and patient preference data in an innovative, personalized consumer experience that can readily integrate with other wellness offerings and benefits, including cost transparency and telemedicine. Wiser Health’s data-driven approach to health care and smart integrations help consumers take action while also driving engagement.

Virgin Pulse, Quest Diagnostics Partner to Offer Bestin-Class Biometric Screening Virgin Pulse announced a partnership with Quest Diagnostics to seamlessly integrate biometric screening data into the Virgin Pulse employee well-being platform. Biometric screenings are a key component of organizations’ holistic well-being programs, helping employees understand their health risks and providing employers actionable insights on the health of their workforce. Biometric data integrates with the Virgin Pulse platform and triggers personalized recommendations for each user, tailored to their individual health needs, risks and priorities. In addition, employees can track their health status over time, set realistic goals, and uncover potential health issues. The partnership with Quest Diagnostics will provide full range of biometric screening services and collection methods; four different screening options: onsite, at-home, physician offices and Patient Service Centers nationwide; daily data updates from Quest Diagnostics into the Virgin Pulse platform; and more robust reporting within the Virgin Pulse platform, including biometric data. continued on page 12

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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Get An Insider’s View Of The Private Exchange

FORUM

February 23 – 24, 2016 Embassy Suites Frisco Dallas, TX

GENERAL SESSIONS

DAY TWO Wednesday, February 24

DAY ONE Tuesday, February 23

OPENING GENERAL SESSION 8:30 to 9:45 a.m.

The Dual Role of Health Plans: Selecting Partners and Building Proprietary Exchanges

OPENING GENERAL SESSION 2:00 to 3:00 p.m.

Is It Worth It? Consultants Analyze the Move to a Private Exchange Private exchanges promise to be a hub of consumerism that finally leads to the elusive outcomes of improved employee engagement and reduced corporate health costs. However, there are many factors to consider whether a private exchange (and which private exchange) is right for your organization. This expert panel of consultants will help navigate through today’s private exchange maze, providing answers on the tough questions from implementation to communications obstacles to potential pitfalls. They will analyze the numbers from early adopters and investigate whether exchanges are currently delivering on their promise. By the end, you should know if a private exchange is worth it for your organization.

Given the rapid growth of private exchange enrollment on (primarily) consultant-run platforms, health plans are devising their strategies for how they remain a focal point for health care consumers. According to a report from Deloitte, health plans need a “dual-pronged strategy to play defense against third party-sponsored private exchanges disaggregating and commoditizing their value proposition while also playing offense with a proprietary offering.�

This session will analyze the current and upcoming private exchange offerings from some of the nation’s leading health plans and why employers/brokers may prefer this option to a consultant-run or “pure play� exchange. The panelists will also look at strategies for selecting valuable exchange partners where they can include their major medical and voluntary benefits products.

DAY ONE AFTERNOON GENERAL SESSION 3:30 to 4:30 p.m.

Friendly Feud: Exchange Leaders “Battle� Emerging Players

MID-MORNING GENERAL SESSION 10:00 to 11:00 a.m.

Friendly Feud: What the #$@&%*! Should Brokers Be Doing?

In this friendly debate on private exchanges, leaders representing the early leaders in private exchanges (per enrollment numbers) will engage with leaders from up-and-coming private exchange innovators. The discussion will follow the format of presidential debates, with questions sometimes being posed from our moderator and in other cases from the audience. Come hear the different approaches that these players are taking with their private exchanges and learn what models or products might be the best fit for your (or your client’s) organization. Engage the players by asking your own questions.

Pick a side or just come to learn.

This panel discussion will cover all angles of how benefits brokers fit into the private exchange puzzle. In the post-ACA era, there has been considerable debate on the future role of brokers in the employer-sponsored benefits landscape. With a growing number of self-service technologies available, some prognosticators called for the end of the broker. However, it’s now clear the opposite is true: brokers will continue play a major role in this market in the years ahead. Panelists in this general session will delve into the changing role of benefits broker, whether or not they should partner with a private exchange, what qualities they should look for in an exchange partner if they decide to do so and much, much more.

DAY ONE CLOSING GENERAL SESSION 5:00 to 6:15 p.m.

Rapid Fire Innovation Demos: What’s on the Horizon?

Looking for the latest ideas and products in the employer-sponsored health and benefits world? You have come to the right place. This session showcases the newest innovations on the landscape and how they integrate with the world of private exchanges. Watch participants feature their newest breakthroughs, demonstrating the most innovative, cutting-edge products affecting health and benefits management today.

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AFTERNOON GENERAL SESSION 1:45 to 2:45 a.m.

Providing the Right Consumer Experience: Empowering Consumers Beyond Major Medical Millennials have now taken over as the largest growing component of the U.S. workforce, and they’ve brought their digital age preferences with them.

If private exchanges are to be the promised consumer-centric hub for benefits, the technology will have to meet the demands of its users. Beyond enrollment in major medical, employees are looking for other tools like cost/ quality transparency, HSA account info, telehealth, wellness incentives, health advocacy and more. They want to navigate benefits in a consumer-friendly, Amazon-like experience. In this informative session, panelists will share how exchanges can expand consumer choices beyond insurance options and

Private Exchange Future... Now The best decisions begin with a complete view of the private exchange landscape. Because the private exchange market is a confusing tangle of models, choices and offerings, there’s only one way that you can truly be prepared. Private Exchange FORUM is your guide to gaining a 360-degree perspective on private exchanges and defined contribution.

Whether you’re an employer, broker/advisor or insurer, this is where you’ll find the education, collaboration and access to solutions that you need to help make the right decisions going forward for your business. how embedding other solutions can create a more robust, more effective consumerism platform.

CLOSING GENERAL SESSION 4:30 to 5:30 p.m.

To Adopt or Not to Adopt: Employers Evaluate Exchanges and Share Experiences

Thank you GOLD and SILVER sponsors for your support!

According to a recent survey of employers by the Deloitte Center for Health Solutions, 30 percent of non-adopters say they are interested in moving to private exchanges, and 62 percent say will likely move in the next one to two years. More employers than ever are either jumping on the private exchange bandwagon or are considering it. Before any employer makes the move, though, they must consider all aspects of the transition — what is involved with benefits administration, the cost and effort to switch to a private exchange, the transition and use for their employees — even fee levels for not adopting. Employers in this general session will share their experiences with and thoughts about private exchanges. They will discuss the positives and potential shortcomings with exchanges, providing attendees with first-hand knowledge they can bring back for use in their organizations.

WORKSHOPS TRACK ONE Wednesday, February 24, 11:30 a.m. to 12:30 p.m. t t t t t t

SESSION 101 – Health Management: Crucial to Private Exchange Success?

SESSION 102 – What to Put on the Shelf? Voluntary Benefit Considerations SESSION 103 – Defined Contribution Health Care: A Hands-on Workshop SESSION 104 – Decision Support and Engagement: Helping Employees “Right-size” Benefits Selection SESSION 105 – Employer Case Studies: What’s Working? What’s Not? SESSION 106 – Going Beyond Enrollment: Embedding Telehealth, Transparency and Other Solutions

TRACK TWO Wednesday, February 24, 3:00 p.m. to 4:00 p.m. t t t t t t

SESSION 201 – Retiree Health Care and Private Exchanges: Key Considerations SESSION 202 – What to Put on the Shelf? Supplemental Health Benefit Considerations SESSION 203 – Benefits Brokers and Private Exchanges: Death Knell or Huge Opportunity?

SESSION 204 – Compliance Concerns for Private Exchanges SESSION 205 – Private Exchanges for the Middle Market: A Rapidly Emerging Area SESSION 206 – Game-Changing Combination of HSAs and Private Exchanges

Acclaris Maestro Health BenefitWallet Blue Cross and Blue Shield of Texas Maxwell Health SelectAccount Renaissance Dental Colibrium HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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HEALTHCARE CONSUMERISM NEWS BRIEFS

Tango Health Receives Certification from IRS to Participate in ACA Information Returns Program Tango Health has been approved by the Internal Revenue Service to file electronically through the agency’s Affordable Care Act Information Returns Program, a significant achievement that will streamline ACA compliance reporting for Tango’s customers. Tango, one of only a few IRS-approved software vendors, completed a lengthy and rigorous certification process, including all eight of the agency’s Affordable Care Act Assurance Testing System scenarios for 2015. Under recently released IRS regulations, employers filing at least 250 returns under Sections 6055 or 6056 of the Internal Revenue Code must do so electronically using the AIR Program. However, the process of filing Forms 1094-C and 1094-C electronically can be very tedious and challenging to employers facing the March 31 reporting deadline.

Alegeus to Power BCBS of Massachusetts’ ConsumerDirected Health Care Programs Alegeus announced that Blue Cross Blue Shield of Massachusetts will use its platform to help its members in consumer-directed health plans. The U.S. health care market is in the midst of a shift towards individual responsibility for health care costs. With consumer outof-pocket responsibilities increasing, CDHC accounts — including flexible savings accounts, health savings accounts and health reimbursement arrangements — are growing rapidly as an attractive tool to help consumers save and pay for the cost of their care. By using the Alegeus platform, Blue Cross members can optimize the value of their plan, manage and maximize their health care dollars and make informed health care decisions for themselves and their families.

HealthEquity Launches New Index Investor™ HSA Featuring Vanguard Funds HealthEquity announced the launch of Index Investor HSA™, a health savings account for the Vanguard community. Index Investor is the first HSA to offer Institutional Shares, Vanguard’s most costefficient fund class, to individual investors. Vanguard, a pioneer in low-cost, long-term investing strategies, is one of the world’s largest investment management companies, with more than $3.4 trillion in global assets under management. HealthEquity is one of the oldest and largest custodians of health savings, with 1.6 million HSA members nationwide.

Interactive Health Earns Highest Accreditation from NCQA Interactive Health announced it has again earned Accreditation With Performance Reporting status in Wellness & Health Promotion from the National Committee for Quality Assurance. This credential verifies to employers Interactive Health’s use of industry best practices and demonstrates its commitment to quality improvement, increased performance measures and better health outcomes. The NCQA Wellness & Health Promotion credential provides employers a way to evaluate providers. Interactive Health is one of only two providers to continuously hold Wellness & Health Promotion Accreditation since its inception. Interactive Health earned its first NCQA Accreditation in 2009, and has achieved Accreditation With Performance Reporting status continuously since 2010. The credential illustrates Interactive Health’s willingness to provide statistics on outcomes achieved and have all services, policies, processes, and procedures — including those that protect the

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continued from page 9

privacy of participants — externally audited by a national oversight committee of physicians.

Picwell Secures Partnership with Health Advocate to Enhance Consumer Decision Support Picwell has announced a partnership with Health Advocate. As part of this strategic relationship, Health Advocate will add Picwell’s technology to its Enrollment Advocate solution, further helping its members navigate the complexities of health care. Picwell’s advanced health plan recommendation engine will power the relaunch of Health Advocate’s Enrollment Advocate program, a service that connects employees with experienced benefits specialists to help them understand the details of available benefits plans. Integrating Picwell’s technology into this program will ensure employees have the resources necessary to choose the right plan for their specific needs and maximize their benefits to reduce costs and improve health outcomes. As part of this relationship, Picwell will also offer Health Advocate’s personalized assistance to its customers as an available service enhancement.

Change Healthcare Announces True View™ Health Care Services Shopping Platform Change Healthcare announced that millions of consumers now have access to an improved health care shopping experience with Change Healthcare True View™, a robust health care services shopping platform. The new Change Healthcare True View engagement platform is fast, configurable and intuitive. It leverages more than seven years of experience in the cost transparency space, best practice engagement strategies and contemporary design standards to help health plans and employers empower more informed health care consumers. The plan-specific details, personalized savings options, persistent search on every page and comprehensive results mean more savings opportunities for consumers and lower health care costs for Change Healthcare clients.

NCQA Grants American Well’s Affiliated Provider Network Top Accreditation Score American Well has announced that its affiliated provider network, Online Care Group, received certification from the National Committee for Quality Assurance for physician credentialing, with a perfect score of 100 percent. This is not the first time the American Well family has received industry certification for meeting quality standards. In 2015 Amwell, American Well’s direct-to-consumer service, became the first and only consumer telehealth platform to receive accreditation by the American Telemedicine Association.

Trustmark Named Preferred Carrier Partner by ProSential Group Trustmark Voluntary Benefit Solutions recently announced its new preferred carrier status by ProSential Group. This partnership will provide larger reach for Trustmark and expand ProSential Group’s service offerings. ProSential Group is a network of local independent employee benefit brokers throughout the United States that joined forces to expand their capabilities and expertise. ProSential Group’s mission is to enhance the resources and capabilities of its broker partners by leveraging their collective strength to enable them to best serve their clients.

HEALTHCARE CONSUMERISM RESEARCH, SURVEYS & REPORTS

New Study Reveals the Connection Between Resilience and Positive Business Outcomes

Guardian: Advancements in Outsourced Expertise, Tech are Reshaping Benefits Landscape

As resilience building and mindfulness training programs continue to gain momentum in the workplace, meQuilibrium conducted a study to measure resilience against industry-standard psychological metrics and desired business outcomes. The company recently released the study findings in a report, “The Science Behind Resilience: A Study of Psychometric Measures and Business Outcomes,” which highlights the impact of resilience on stress, absenteeism, intent to quit, job satisfaction and physical health. meQuilibrium surveyed 2,000 employed individuals, ranging from age 18 to 64. They completed the company’s proprietary resilience assessment, developed by its team of experts who have spent decades studying resilience and positive psychology. Key findings from the study include: highly resilient workers have 46 percent less perceived stress than low resilience workers; compared to highly resilient workers, twice as many employed individuals with low resilience have reported one to three absences in the past month; and individuals with low resilience are twice as likely as those with high resilience to quit in the next six months.

Guardian has announced new findings from the third annual Guardian Workplace Benefits StudySM that outlines how one in three employers now outsource all of their benefits administration – up 20 percent since 2013. Employers are also using more vendors for support: nearly twothirds that outsource at least some benefits administration are using multiple vendors, up from 48 percent in 2013. As employers of all sizes realize the need to improve efficiency; keep compliant with requirements of the ACA, FMLA and ADA; and improve employees’ benefits enrollment experience, they will need to rely more heavily on external expertise to meet their goals. The study signals future growth in outsourcing management of employee absences as employers emphasize the need to increase employee productivity, adhere to FMLA, ADA, and ADAA requirements, expand wellness initiatives and provide more assistance for employees returning to work following a disability.

HEALTHCARE CONSUMERISM PEOPLE ON THE MOVE

Healthways Expands Leadership Team with Addition of Two Industry Innovators Healthways has announced that Sean Slovenski, a recognized innovator in the health care and well-being improvement industries, will join the company as president of Population Health Services. Slovenski has held significant senior leadership roles in the health care industry, most recently as the CEO of Care Innovations, a joint venture between Intel and GE in the remote patient monitoring sector of health care.

Healthways also announced the addition of Steve Schwartz as senior vice president of Strategy and Corporate Development. Schwartz brings more than 25 years of experience in building high growth companies in health care and information technology. He joins the company from Silicon Valley’s 23andMe, where he was vice president of business development and strategy.

ECFC Hires Martin Trussell as Executive Director ECFC is excited to announce Martin Trussell as their new executive director as they continue to expand their influence in advancing health care consumerism. Trussell is a 30-year veteran of the health care industry, including holding senior marketing and sales roles with third party benefits administrators and HMOs, and more than a decade in the corporate offices of Humana. He has also acted as president of a marketing communications firm specializing in serving health care clients. Most recently, Trussell was vice president of sales and business development at Acclaris.

HEALTHCARE CONSUMERISM FUNDING/MERGER ANNOUNCEMENTS

Vitals Secures $41 Million from Goldman Sachs, Existing Investors Vitals recently announced that the company secured $41 million in funding from the Merchant Banking Division of Goldman Sachs and existing investors. The capital will support the continued expansion of the company’s platform and products that will transform the way consumers shop for health care providers. This round of funding comes at a time when health plans and employers are increasing investment in engagement solutions that will have a long-term and significant impact on the economics of health care. Vitals partners with these organizations to reduce health care spend and to create a competitive health care marketplace for consumers, which is a “win-win” for consumers and payers.

Vericred Closes Second Seed Round of $3.1 Million Vericred, a health care technology startup delivering transparency solutions to the health insurance industry, has closed a second seed round raising $3.1 million through the sale of Series SEED II Convertible Preferred Stock to accredited investors. Proceeds will be

used to expand the company’s data services and offerings while scaling its sales efforts. The new round follows a Series SEED round of $1.125 million, which closed in November 2014. Seventy-two percent of the first seed round investors participated in the second round.

Welltok Acquires Silverlink to Enable Multi-Channel, Targeted Engagement Welltok continues its rapid growth with the strategic acquisition of Silverlink, a leading health care consumer communications company.

To support part of the acquisition, ongoing product development and market expansion, Welltok secured $45 million in funding from venture firms Georgian Partners, EDBI and Flare Capital Partners, as well as a number of existing institutional and strategic investors. Welltok’s CafeWell Health Optimization Platform™, combined with Silverlink’s proactive engagement technology platform and services, will enable population health managers, including health plans, at-risk providers, government programs and large employers, to reach and influence all types of consumers on an individual level.

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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To learn more about our suite of WalletDoc consumer tools, visit SelectAccount.com/WalletDoc

BY STEPHANIE SHIELDS VICE PRESIDENT OF PRODUCT AND MARKETING AFLAC GROUP INSURANCE

VOLUNTARY BENEFITS

Health Care Benefits Don’t Stop at Insurance &NQMPZFST HFU NPSF GPS UIFJS NPOFZ BOE NPSF GPS FNQMPZFFT XJUI WBMVF BEEFE TFSWJDFT

I

f you’ve ever used a grocery store app to pre-order food, a furniture store’s free interior decorating service or a department store’s free gift wrapping offer, you’ve experienced the benefit of a value-added service.

These services are everywhere, and health care benefits are no exception.

Value-added services complement a core service or product, benefiting both the consumer and the entity providing the service.

Consumers receive something in addition to their basic need, while the person or company providing the service potentially generates new business or improves customer loyalty.

The role of value-added services in health care benefits For many companies, value-added services already play a significant role in benefits. For example, some employers offer generous maternity/ paternity leave, subsidized gym memberships or on-site gyms and medical care facilities. It makes sense: employees appreciate the convenience, and employers know that people with healthy lifestyles are less likely to miss work due to illness.

Now some employers are extending their health care benefits even further to include additional value-added services.

When asked to choose the top non-workrelated issue that distracts them during work, 20 percent of employees named “personal financial issues,� while another 11 percent named “personal health issues.�1 It’s worth an employer’s time to consider adding services to its benefits offerings that could boost productivity.

These services make it easier to access care, reduce out-of-pocket medical expenses and navigate the health care system with greater ease.

The benefit to employers? For starters, there is employee loyalty and productivity. Value-added services remind employees that their employer supports them not just when they’re sick, but before and after, too. And The value for employees the time that employees don’t have to spend researching health care issues When considering their insurance options, value-added services can or speaking on the phone with health care or insurance providers is time help employees balance the importance of long-term value and immediate they can spend on work. Time is money, and employers can’t afford to return. underestimate how much time is often lost. When asked to choose the Below are a few examples of what value-added services can provide: top non-work-related issue that distracts them during work, 20 percent of employees named “personal financial issues,�

Value-added service What employees get while another 11 percent named “personal health issues.�1 It’s worth an employer’s time Connection with board-certified, U.S.-licensed health to consider adding services to its benefits providers online for 24/7 medical access. From care offerings that could boost productivity.

Telemedicine coordination and real-time video or telephone visits with Another advantage for employers: a provider to prescriptions — it’s a faster, easier way Extra services add value to their benefits for employees to get medical care. packages at little or no cost. To purchase these services directly, employers would Access to personal health advocates who can find incur additional costs for each employee specialists, help with elder care issues, clarify every month, but offering these through their coverage, address claims denials and even schedule insurance carriers costs companies (and Benefits management appointments. In addition, they can also negotiate support an employee’s medical bills not covered by health often employees) little or nothing.

insurance. It saves employees time by rescuing them from overwhelming questions, confusing claims and unexpected costs.

Fraud protection

Provides protection to employees’ personal and financial information to help prevent major losses from occurring.

1 In 2015 AflacŽ partnered with LightSpeed GMI to conduct its first CSR national survey to determine consumers’ thoughts about companies’ social responsibility and philanthropic efforts. To learn more, visit Aflac.com\ACSR

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First Quarter 2016

Exchange o t Innovative Health and Benefit Ma

et la e

The Choices People Make

(And Their Implications For Private Exchanges)

Intersection of Private Exchanges and Self-Funding

Private Exchanges Offer Small Employers Big Benefits istock.com/ 01 110

The Official Magazine of

www.theihcc.com

INSIDE FEATURE 13 The Choices People Make How employees make health plan decisions and the role of private exchanges in those decisions An increasingly diverse workforce. Health care costs that continue to significantly outpace inflation.

Employers are finding themselves introducing a broad array of new health plan options in order to meet these needs and manage cost increases. Because of these expanded choices, employees need to be more knowledgeable and assume more responsibility for decisions regarding their health care – decisions that become more complex with each additional option.

DEPARTMENTS 7

STATS & DATA What Employees Know About Private Exchanges (That Their Employers Don’t)

By Alan Cohen, Co-founder and Chief Strategy Officer, Liazon

By Sherri Bockhorst and Andrew Mackenzie, Willis Towers Watson

istock.com/rendeep

4

Publisher’s Letter CEO and Publisher Doug Field covers the latest trends in private exchanges and shares what’s happening at The Institute for HealthCare Consumerism around exchanges.

6

Briefs & Innovations t t t t

"DDFOUVSF &JHIU .JMMJPO &NQMPZFFT &OSPMMFE JO 1SJWBUF &YDIBOHFT 'JEFMJUZ *OWFTUNFOUT -BVODIFT 'JEFMJUZ )FBMUI .BSLFUQMBDF .BFTUSP )FBMUI "EET /FX %JWFSTJUZ 5XJTU JO #FOFmUT XJUI ,BTIBCMF 8JMMJT 5PXFST 8BUTPO "OOPVODFT 3FUJSFNFOU PG +JN 'PSFNBO

9 SMALL EMPLOYERS Private Health Exchanges Offer Small Employers Big Benefits

By Joe Laurin, President, Fidelity Health Marketplace

10 SELF-FUNDING The Intersection of Private Exchanges and SelfFunding

By Jeff Yaniga, Chief Revenue Officer, Maestro Health

11 BROKERS & ADVISORS The Private Exchange Market: A Different View On Adoption

By Scott Stauffer, Private Exchange Director, Benefit Advisors Network

HealthCare Exchange Solutions™ I www.TheIHCC.com I First Quarter 2016

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PUBLISHER Exchange www.theihcc.com

Understanding Employee Choice in Private Exchanges

VOLUME 3 NO. 1 | FIRST QUARTER 2016

Published by FieldMedia LLC 292 South Main Street, Suite 400 Alpharetta, GA 30009 Tel: 404.671.9551 • Fax: 770.663.4409 CEO

If you’re reading this, there’s a good chance you’re at our first private exchange-specific event of the year — 2016 Private Exchange FORUM Dallas. If so, welcome! We appreciate your support of and collaboration in this growing event.

If you couldn’t make it down to Dallas, remember that you can catch many of the sessions through our IHC University program. Videos are typically available on our website within four weeks of the end of

Doug Field 404.671.9551 ext. 101 ¡ dfield@ theihcc.com CHIEF MARKETING OFFICER

Andrew Dietz adietz@theihcc.com MANAGING EDITOR

Jonathan Field jfield@theihcc.com SENIOR EDITOR

the conference.

Whether you attended the Dallas event or not, you will certainly want to make note of our second Private Exchange FORUM of the year. In September, we’ll be heading back to Baltimore’s Inner Harbor for the second annual Private Exchange FORUM Baltimore. Visit our conference website today for access to $99 super saver rates.

In this first issue of 2016, we’re excited to feature expert opinions from many of the major players in private exchanges — from Maestro Health to Willis Towers Watson to new entrant Fidelity. In their respective articles, expert contributors from both Liazon and Willis Towers Watson delve into the employee decision-making process inside a private exchange.

At our conferences, a major point of contention has always been how much choice is the right amount of choice. Many HR/benefits leaders have publicly doubted the average employee’s ability to select the right level of benefits for himself and/or his family. The survey-backed insights here shine some light into that area and will doubtlessly answer many important questions for employers looking into private exchange adoption.

Heather Loveridge hloveridge@theihcc.com RELATIONSHIP MARKETING MANAGER

JJ Atherton jjatherton@theihcc.com DIGITAL MARKETING MANAGER

Eric Bruce ebruce@theihcc.com ART DIRECTOR

Kellie Frissell 404.671.9551 ext. 107 ¡ kfrissell@fieldmedia.com CHAIRMAN OF IHC ADVISORY BOARD

Ronald E. Bachman, CEO, Healthcare Visions EDITORIAL ADVISORY BOARD

Kim Adler, Allstate; Diana Andersen, Zions Bancorporation; Bill Bennett; Doug Bulleit, DCS Health; Jon Comola, Wye River Group; John Hickman, Alston+Bird LLP; Tony Holmes, Mercer Health & Benefits; Marc Kutter, Aflac; Sanders McConnell, TSYS Healthcare; Roy Ramthun, HSA Consulting Services LLC; John Young, Consumerdriven LLC WEBMASTER

Elsewhere in these pages, Jeff Yaniga at Maestro Health looks at the intersection of self-funding and

Tim Hemendinger timh@fieldmedia.com

private exchanges; Scott Stauffer at Benefit Advisors Network gives readers a different view on market

DIRECTOR OF CONFERENCE SPONSORSHIP/ CORPORATE MEMBERSHIP/REPRINTS

adoption; and Joe Laurin at Fidelity, who just launched Fidelity Health Marketplace, provides insights on

Rogers Beasley 404.671.9551 ext 109 ¡ rbeasley@fieldmedia.com

the usefulness of private exchanges for smaller employers.

To all of our contributors, we thank you for your time and your insights. To all of our readers, we hope

ACCOUNT MANAGERS

Michelle Gatehouse 404.405.3007 • mgatehouse@theihcc.com

to see you at one of our Private Exchange FORUM conferences this year. Visit PrivateExchangeFORUM. com for more information.

PARTNERS/ALLIANCES

Joni Lipson 800.546.3750 ¡ jlipson@fieldmedia.com HealthCare Exchange Solutions™ Volume 3 Issue 1 Copyright Š2016 by FieldMedia LLC. All rights reserved.

Sincerely,

Doug Field CEO/Publisher dfield@fieldmedia.com

HealthCare Exchange Solutions™ is a trademark of FieldMedia LLC. HealthCare Consumerism Solutions™ is published eight times yearly by FieldMedia LLC., 292 South Main Street, Suite 400, Alpharetta, GA 30009. Periodical postage paid at Alpharetta, GA and additional mailing offices.

TO SUBSCRIBE: Make checks and money orders payable to HealthCare Exchange Solutions ™ magazine 292 S. Main Street, Suite 400, Alpharetta, GA 30009 or visit www.theihcc.com. Non-qualified persons may subscribe at the following rates: single copy $7.50; $75.00/yr in the U.S., $105/yr in Canada and $170/yr international. Please contact FieldMedia at 404.671.9551 or subscriberservice@fieldmedia.com for name/address changes.

PRINTED IN THE U.S.A. HealthCare Exchange Solutions™ is designed to provide both accurate and authoritative information with regard to the understanding that the publisher is not engaged in rendering legal, financial or other professional service. If legal advice is required, the services of a professional adviser should be sought.

The magazine is not responsible for unsolicited manuscripts or photographs.

Send letters to the editor and editorial inquiries to the above address or to jfield@fieldmedia.com. Permission to reuse content should be sent to, jfield@ fieldmedia.com.

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©2015 WiserTogether, Inc. All Rights Reserved.

Who do you want helping employees make treatment decisions?

There’s a better way to give people the information they need.

When it comes to choosing treatment options, after their doctor most people turn to friends and family. With WiserTogether, there’s a better way to decide. Our personalized, evidence-based tools guide consumers to treatment decisions that work best for them— personally, clinically and financially.

4 million data points.

But maybe you should call Grandma, too. She’d like that.

Contact us to learn more: 202.503.3700 info@wisertogether.com http://wisertogether.com Clinical Evidence Personalized Treatment Comparisons Better Health Outcomes

NEWS BRIEFS & INNOVATIONS

NEWS BRIEFS Accenture: Eight Million Employees Enrolled in Private Exchanges for 2016 Benefits A new report from Accenture estimates that the number of people who enrolled in private exchanges for 2016 increased 35 percent from last year, to approximately eight million, up from approximately six million in 2015. Accenture’s research indicates that the growth of private health insurance exchanges continues to be fueled by midsize companies with 100 to 2,500 employees. The rate of adoption among large employers did grow slightly in 2015, but many have been on the fence in determining whether to adopt private health insurance exchanges.

RedBrick Health Integrates Advanced Well-Being Platform into Towers Watson’s Private Exchange RedBrick Health announced it is expanding its relationship with Towers Watson’s OneExchange. RedBrick Health began providing integrated well-being services for the OneExchange group solution in January 2015 and will serve an expanded group of employer clients across such industries as hotels, media, retail, health care, business services, manufacturing and more for 2016. RedBrick provides a consistent wellbeing employee experience across all the group health plans offered on OneExchange. This means employees can choose a plan from any carrier and have a consistent well-being program that carries over year after year. The integrated rewards model provides flexible rewards that can fund employees’ health accounts or reward them in other ways.

Fidelity Investments Launches Fidelity Health Marketplace Fidelity Investments has announced the launch of Fidelity Health Marketplace, which offers one-stop access to health and wellness benefits to small and mid-sized businesses and their employees.

Fidelity Health Marketplace offers employers the ability to choose from an extensive network of national and regional medical, dental, vision and life benefits in addition to tax-savings options and access to wellness tools and programs. Several customers in Massachusetts and New York are already using the marketplace. The platform uses hCentive’s WebInsure Benefits private exchange technology platform, which offers an integrated enrollment experience and pre-configured connections to a network of insurance carriers and a range of health and other ancillary benefits.

Aflac Teams with Liazon Private Benefits Exchange to Offer Group Products Aflac announced that it is partnering with Liazon to provide brokers working with large businesses nationwide more options for when and how they do business with Aflac. As a result of this agreement, approved brokers will now be able to offer Aflac’s group critical illness, accident and hospital indemnity plans through the Bright Choices exchange and other Liazon-powered exchanges – providing employers a way to provide their employees a broader range of choices to build a personalized portfolio of benefits.

Maestro Health Adds New Diversity Twist in Benefits with Kashable Partnership In response to widespread employer demand for greater diversity in their health benefits, Maestro Health has announced its partnership with Kashable, a socially responsible financing solution for employees.

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Expanding voluntary benefit offerings to include non-insurance products on Maestro Health’s innovative tech-meets-service platform, maestroEDGE, offers employers a holistic approach to better align the health and financial well-being of their employees.

CoreSource and Liazon Partner to Launch TPA Private Exchange Solution CoreSource, a national health benefits administrator, and Liazon announced a partnership to create a new third party administrator private exchange solution for companies. The online storefront will be stocked with self-funded health plan designs chosen by employers with help from their brokers, and employees will have the ability to apply defined contribution dollars to purchase coverage under their employer’s self-funded plan for themselves and their families.

CoreSource’s offering will feature five high deductible health plan designs, five PPOs and two dental plan designs, as well as additional services, such as wellness programs that employers can incorporate into their self-funded health benefit plan and access to short-term disability income insurance.

Maestro Health Announces Explosive Growth; Expansion Fueled by Response to Employer Demand Maestro Health marked 2015 with record momentum by adding 158 new logos — a 45 percent increase in revenue over the prior year — and expanding deployments for existing customers on the maestroEDGE platform. There are several notable household names included in this growth, including Blue Cross Blue Shield of Arizona, DISH Network and Mazda via broker partners. 2015 witnessed a greater demand for an all-in health and benefits platform that could eliminate vendor juggling, reduce administrative burden and manage enrollment more intuitively. Maestro Health also grew its physical presence, with new office locations in Detroit and Phoenix, a facility expansion in Charlotte and approximately 81 new hires joining between January and December.

Willis Towers Watson Announces Retirement of Jim Foreman, Exchange Solutions Leader Willis Towers Watson has announced that Jim Foreman, managing director of the company’s Exchange Solutions business segment, will retire at the end of March 2016. Gene Wickes, currently co-leading the integration efforts for Willis Towers Watson, will succeed Foreman.

During his tenure, Wickes has held several key leadership positions and served as a member of the Management Committee. Prior to the Willis Towers Watson merger, he was managing director for the benefits business, the company’s largest and most profitable business segment, for 12 years.

Array Health, GetInsured Partner to Provide Comprehensive Solution for Insurer-Led Private Exchanges Array Health and GetInsured have partnered to provide GetInsured’s individual solution on Array Health’s private exchange platform for insurer-led exchanges. The partnership will help insurers gain and retain current members as they move between group and individual coverage and give employers and consumers the flexibility they need.

The combined solution delivers a tailored shopping experience for different types of consumers, from the experienced shopper who knows exactly what to purchase to the novice who needs more guidance and information to make a decision.

STATS & DATA

What Employees Know About Private Exchanges (That Their Employers Don’t)

BY ALAN COHEN » CO-FOUNDER AND CHIEF STRATEGY OFFICER » LIAZON

W

hen it comes to employee benefits, employers may be underestimating their employees.

Our 2015 survey of employers and employees using Liazon Exchanges for their benefits enrollment yielded some interesting distinctions between what employers think about their employees’ experience and what their employees actually told us.

While employer perceptions of how their employees view their exchange experience is favorable, it turns out employees are way more excited about being in the driver’s seat — and the variety, support and overall experience provided — than their employers believe.

While 77 percent of employers believe their employees are satisfied with their exchange experience, a full 96 percent of employees reported overall satisfaction. We dug a little deeper to determine what specific factors delighted employees and here’s what we discovered:

Decision Support Just over half of the employers we surveyed felt their employees valued decision-support tools. But what employers aren’t realizing is that nine out of 10 employees found the recommendation and education provided to be helpful and nearly threequarters trusted the recommendation they received from the system.

Choice & Variety The fact that employees value choice came to us as no surprise in this year’s survey. Ninety-six percent of the employees we surveyed said they would rather choose their own benefits than have their employers choose for them.

Seventy-six percent of employers told us they felt their employees were satisfied with the variety of products available to them on our exchanges. The reality was, 89 percent of employees said they were satisfied with their benefits choices available. This is an important finding for employers who use benefits as a retention tool because studies have found that the more types of benefits you offer, the more employees’ intent to stay with their company increases.1

Servicing When it comes to getting their questions answered enrollment process, employees are also more satisfied employers may think. Eighty one percent of employees employee service center helpful, while 50 percent of perceived this to be the case.

during the than their found our employers

Value for Benefits Dollars One area we found employers and employees to be in sync when it comes to private exchanges was in appreciating the value of the company’s contribution. More than 60 percent of employees are more aware of their company’s contribution, in line with their employers’ estimates.

But there is still room for improvement as we believe that 100 percent of employers and employees should understand that the dollars a company spends on its employees’ benefits are a form of compensation.

Listening to Employees Some employers have been reticent to provide employee benefits through private exchanges for a number of reasons. But it’s not surprising that employees are the ones seeing the real advantages because when it comes down to it, benefits are about them. As individuals increasingly become more involved in these decisions, private exchanges are ideally suited to tap into this desire for knowledge by giving them an easy way to make better choices for themselves and their families.

The message for those employers who have adopted a “wait and see” attitude when it comes to private exchanges is: wait no more. Your employees have spoken. It’s time for employers to accept the new reality not because we as an industry are telling them to, but because their own employees get that choice in benefits and the power to make their own decisions is the future. _________________________________________________________ 1 MetLife, 13th Annual U.S. Employee Benefits Trend Study, 2015, “Choice is the New Standard”

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SMALL EMPLOYERS

BY JOE LAURIN PRESIDENT FIDELITY HEALTH MARKETPLACE SM

Private Health Exchanges Offer Small Employers Big Benefits

S

mall employers are truly the lifeblood of the U.S. economy, part of the employer that they might be doing something wrong and employing almost half of the private sector workforce. putting their organization at risk.

Entrepreneurship is also thriving today, as 27 million workingOne way many employers have tackled these concerns is by age Americans — nearly 14 percent of the workforce — have started making the switch to private exchange technology. Until recently, or run new businesses1. Yet, when it comes time for these small this type of technology was only available to large employers who employers to select and administer benefits, the lack of real options could afford it. But now, with the advent of solutions designed to can feel like a hurdle to long-term success. accommodate their unique needs, the tide is shifting in favor of small Small employers know that in order to retain and attract top employers. talent, a competitive benefits package is crucial. The stakes are Our Fidelity Health MarketplaceSM is one such solution. Fidelity’s especially high for these employers, since landing and keeping the roots are in helping employers — regardless of their size — offer right talent can truly mean the their employees the variety of difference between success and products they need to help them A theme I hear from the small failure. However, offing more feel secure about their financial benefits options often means a future. We’ve created Fidelity businesses we talk to is that they greater administrative burden in Health Marketplace in order to the form of additional forms to offer the same level of support know they should offer more choices, complete and benefits to track. and choice when it comes to especially when it comes to health This often puts them out of health and welfare benefits. Our reach for an already stretchedplatform simplifies the process coverage options, but are hesitant to too-thin HR person or team. of benefits administration and One bit of lore I’ve heard do so. They simply don’t have the tools enrollment, and creates an is that small businesses are integrated portal so employees and help necessary to truly understand can review their financial and okay with the “one-size fitsall” benefits options they have health benefits all in one place. how these products work now. Let’s be clear — small The technology connects employers want options for directly with the providers on our themselves and their employees. platform, eliminating paper forms In fact, employers with fewer than 1,000 employees are much more and providing employers with real-time reporting tools. Our technology likely to be shopping for a better health insurance option than their helps the employer track benefits activity and eases both administrative larger counterparts2. and compliance-related burdens.

A theme I hear from the small businesses we talk to is that they We are offering an overdue and much needed solution to the know they should offer more choices, especially when it comes to engine of our economy — busy, supremely talented business owners health coverage options, but are hesitant to do so. They simply don’t and HR professionals who wear many hats. We are excited to see have the tools and help necessary to truly understand how these Fidelity Health Marketplace help these professionals spend less time products work — let alone help employees make the right choices for on benefits administration so they can work on realizing their business their own personal health and financial situations. Instead, employers objectives — whether it is to be a thriving small business, or world stick to what they (and their employees) know, and miss out on other, domination. potentially desirable options. _________________________________________________________ From a regulatory and compliance perspective, small employers 1. http://www.babson.edu/Academics/centers/blank-center/global-research/gem/ are at a disadvantage as well. The unfortunate truth is providing health Documents/GEM 20USA 202014.pdf coverage for 10 or 10,000 employees comes with a host of compliance 2. http://kff.org/report-section/ehbs-2015-section-fourteen-employer-opinionsand-health-plan-practices/ concerns that can’t be ignored. Small employers are often left on their own to figure it all out. This leads to frustration and uneasiness on the Photo by Stuart Darsch

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SELF-FUNDING

BY JEFF YANIGA CHIEF REVENUE OFFICER MAESTRO HEALTH

The Intersection of Private Exchanges and Self-Funding

I

n the post-ACA world of private exchanges and self-funding, two trends continue to proliferate: private exchanges continue to add employees (albeit slower than the early predictions); and, self-funding continues to be a key strategy for employers. Both offer “catered� experiences, but when the two strategies intersect, the results can transform employee health and benefits.

The Intersection of Employee Choice and Employer Decision Making

they need, avoiding wasted money on over-insuring, or even worse, not having enough coverage for an unexpected claim.

A self-funded exchange helps employees and employers control cost. When executed correctly, employers can offer rich benefits or address their budget needs by adjusting benefits design, rather than simply reducing benefits. The best self-funded service teams deliver strategies that observe how employees are using benefits and nudge them toward the appropriate care. Great self-funded strategies guide employees beyond the day they enroll. Today’s innovators drive wellbeing, education and utilization the other 364 days of the year. Effective self-funding expertise drives cost control in addition to fully-insured claims reserve surcharges.

A self-funded private exchange offers greater choice, easier decisions and more control for both constituents.

No two employees are ever the same. Recognizing that they have different needs is critical to an optimized benefits strategy. Private exchanges connect employees (the buyers) and benefits suppliers A Smarter, More Informed Benefits Experience (the sellers), in a similar way that Amazon.com might connect a If claims data is the treasure map for employees and employers, retailer with an online shopper. Benefits, specifically the process of the private exchange is where the “X� marks the spot. choosing benefits, can be very complex. As part of this buyer-seller When self-funding and private exchanges intersect, one has the engagement, technology helps power to inform the other. Because simplify the process for buyers claims data is the property of down to a few mouse clicks the employer in a self-funded The best self-funded service teams and answering a few relevant model, the HR professional has deliver strategies that observe how questions. The result: a peoplecomplete visibility into benefits friendly user experience, or what usage and can provide the employees are using benefits and we in the industry refer to as employee with greater support “decision support�. Regardless and guidance when it comes nudge them toward the appropriate of what you call it, it’s all about to wellness and future plan care. Great self-funded strategies guide selection. Innovative, peoplegranting employees more control over their benefit needs. friendly private exchanges serve employees beyond the day they enroll.

Similarly, no two employers information back to employees are ever the same. Limited by via a personal online dashboard, the rigid plan designs found in the creating a richer user experience. fully-insured world, self-funding frees employers to align health benefits Actionable knowledge is where transformation happens. When with company goals, giving them greater authority over their benefit self-funding and private exchanges intersect, the model can educate requirements. and guide employees toward new benefit products and plan options, as well as empower them to take immediate action in the best interest Greater Selection at the Right Price of their health. At the same time, employers can optimize their benefits When private exchanges are done right, employees benefit in strategy with greater cost control, more options and deeper insights. major ways. Whereas benefit plan decisions used to be limited to “yes� Overall, the entire benefits process becomes smarter, personalized and or “no� selections, employees now have the opportunity to fill their more efficient for everyone involved. cart with the benefit “groceries� they really need. For some, a high Currently serving as chief revenue officer, Jeff Yaniga architects Maestro’s business deductible plan makes perfect sense. Others have needs that mandate development, innovation and company growth. With his invaluable private exchange implementation “know-how�, he is an invaluable asset to the team. Over the past a richer and more comprehensive plan. For example, growing families few years, Yaniga has become a well-known thought leader in the private exchange might add supplemental life insurance to their cart. Active young adults space—speaking at over 30 conferences. may protect themselves with an accident policy or pet insurance. When given the opportunity, employees are capable of buying exactly what

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BROKERS & ADVISORS

BY SCOTT STAUFFER PRIVATE EXCHANGE DIRECTOR BENEFIT ADVISORS NETWORK

The Private Exchange Market: A Different View On Adoption

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ast year, six million Americans used a private exchange to enroll Here’s Why in employer benefits, which is double the number of 2014 Private exchanges do give organizations a chance to fix and enrollees, according to a predict health care costs, offer report by Accenture. Accenture more choice to employees and Private exchanges do give organizations reduce administrative costs.

— as well as other industry analysts — expects this growth Here are a number of situations a chance to fix and predict health care trend to continue into 2018. where private exchanges can be The report projects exchanges a good solution: costs, offer more choice to employees to enroll 12 million employees and reduce administrative costs. in 2016, 22 million in 2017, and t /FFE UP NBOBHF CFOFmUT 40 million in 2018.

DPTUT OPX Part of the reason for the Companies that are under substantial increases can be attributed to the positive feedback from pressure to reduce costs immediately often look at private users. The Deloitte Center for Health Solutions conducted an online exchanges and their defined contribution funding mechanisms survey of 700 employers last year, finding only eight percent of those as a way to fix their contribution to benefits while maintaining or employers who moved to a private insurance exchange (11 percent even increasing benefit choices for employees. of respondents) were not satisfied with their current exchange — t $PNQPTJUJPO PG XPSLGPSDF meaning the overwhelming majority were pleased. Most said the private Organizations with diverse employee demographics find it exchange has had financial benefits, with only one in five finding their difficult to design a benefits program that is right for each private exchange has not reduced costs of employee insurance. employee. Because most private exchanges offer a number These findings are in line with a case study presented by Sears, of medical plan options as well as a full suite of ancillary and where Dean Carter, the company’s chief human resources officer, said voluntary products, employees have the ability to design the retailer saved $38 million in the first year that it used a private individualized benefit packages. exchange. t *OUFHSBUJPO QPJOU GPS DBSF NBOBHFNFOU XFMMOFTT BOE JODFOUJWF SFXBSET Why All The Buzz Now? The combination of a PE with robust employee communications The pension market provides an interesting analogy. The capabilities coupled with effective cost management vendors tipping point for employers moving to a defined contribution pension has a better ability to reduce the cost of care than any of these marketplace occurred in the mid-eighties. There were three driving vendors on their own. forces: 1) a significant change in regulations — the creation of the 401k; t *OUSPEVDF JOOPWBUJPOT 2) increasing retirement cost burdens; and 3) the advent of technology As mentioned previously, PEs offer employers an excellent that created more flexible and consumer friendly investment platforms opportunity to offer plan, network or product innovations in a developed by companies like Fidelity Investments. But, after an initial choice environment. As part of a long-term strategy, employers surge, DC pension plan participation took a slow and steady climb. can steer employees into more cost effective medical plan In the health benefits market, employers now face increased options or ancillary/ voluntary benefits that meet specific compliance responsibility with the advent of the ACA, continued employee needs. escalation of medical costs, and an employee base that wants more control over how benefit dollars are spent. So, while the environment These situations, for the most, lead to a value proposition may appear to be right for significant growth in private exchanges and that is more geared to employee engagement and attracting and defined contribution funding for health benefits, we believe it is more retaining talent. This is what we believe to be the real value of private likely that the growth trajectory will follow more closely with the DC exchanges. pension market.

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The Choices People Make How employees make health plan decisions and the role of private exchanges in those decisions

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BY SHERRI BOCKHORST AND ANDREW MACKENZIE » WILLIS TOWERS WATSON

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n increasingly diverse workforce. Health care costs that continue to significantly outpace inflation. Employers are finding themselves introducing a broad array of new health plan options in order to meet these needs and manage cost increases. Because of these expanded choices, employees need to be more knowledgeable and assume more responsibility for decisions regarding their health care — decisions that become more complex with each additional option.

Growing complexity is one reason employers are adopting private exchanges as an alternative to self-managing their benefits programs.

Employers adding options to their existing benefit offerings — for example, account-based health plans with high deductibles or high-performance networks — worry that employees will be overwhelmed and end up making poor decisions. Exchanges with well-designed decision support can provide employees with the choice they want and the guidance they need to personalize their benefits.

Providing effective help is the job of the exchange provider, and it’s up to the employer to select the right exchange solution. In our experience, employers today place significant emphasis on the science of designing and pricing health plans, but do not apply the same rigor to better understand their employees as health care consumers.

In the dynamically evolving private exchange landscape, this understanding is critical.

Choice overload — the concept that individuals struggle to make a good decision, or even any decision, when presented with too much choice — is a well-researched phenomenon in behavioral economics, and we would expect to see this in health plan decisions.

Voice of the Consumer Towers Watson — now Willis Towers Watson — fielded an online survey on health plan consumerism among U.S. employees to simulate choice in health plan elections. The Medical Plan Election survey was administered in March 2015 to more than 5,000 people between the ages of 21 and 64 currently enrolled in employer-sponsored health plans. Areas of inquiry included: • Do employees have the ability to handle significant choice of health plans?

• How do different levels of health plan literacy influence their choices?

• How does decision support influence their choices?

For the simulation survey, respondents were randomly placed into one of four groups. Two groups designed their own plans using a dashboard in an open-choice environment while the other two chose plans from a menu of discrete options. Two groups had decision support — including term definitions and an expense calculator that showed the minimum, maximum and expected total costs associated with each plan design based on the respondent’s utilization expectations and health status. The other two groups had no decision support.

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Each plan consisted of the following design elements: deductible, prescription drug co-pay, office visit co-pay, coinsurance and out-of-pocket maximum. The true premium of each plan was actuarially equivalent, but respondents received a randomized subsidy amount to mirror a monthly contribution comparable to traditional employer-sponsored contributions.

As part of the survey, respondents’ health plan literacy was measured in two ways: They were asked a direct question about how much they knew about health insurance compared to the rest of the population.

They were given a brief, five-question health insurance quiz.

What We Learned Our research revealed the following top line findings1.

1. Choice is good, but it must be guided Our research reinforced that employees need choice to account for their wide range of health plan needs and financial preferences. We also know they like having choice. Separate from the simulation research, satisfaction surveys of employees enrolled in Willis Towers Watson’s private exchange solutions show that choice is consistently the #1 most-liked feature; 96 percent say they prefer to choose their own benefits.

Our research showed that while employees like choosing their insurance plans, they tend to prefer and are better equipped to handle a discrete menu of plan choices over the ability to completely design their own health plan.

Choice overload — the concept that individuals struggle to make a good decision, or even any decision, when presented with too much choice — is a well-researched phenomenon in behavioral economics, and we would expect to see this in health plan decisions. In our survey, we asked each respondent how well he or she understood the plan choice they made in our simulation. Individuals in the discrete-choice environment indicated greater levels of satisfaction and understanding than individuals in the open-choice environment.

2. Low health plan literacy interferes with employees making decisions that align with their needs and preferences In our research, 70 percent of respondents could not answer two basic questions about how plan design would impact their out-of-pocket costs. This suggests a pervasive lack of understanding about how health insurance plans work; and that without guidance, most employees likely would be unable to accurately assess how plan design would protect them from out-of-pocket expenses they might not be able to afford.

For example, employees with low health plan literacy tended to focus primarily on their monthly share of plan costs instead of the overall costs of the plans they chose, compared to employees with high health plan literacy. As a result, in the open-choice environment, employees with low health plan literacy chose plans with an average monthly contribution of $146 and a $2,130 deductible. Based on their unique design choices, utilization expectations and health status, these employees had an average expected total medical cost (contributions + out-of-pocket costs) of $5,760 according to our cost calculator. In contrast, employees with high health plan literacy chose plans with a higher average monthly contribution of $173, but a lower $1,350 deductible. These employees had an average expected total medical cost of $4,647.

3. Not surprisingly, employees are influenced by real-time decision support Research studies have shown that employees do not approach health plan election in an analytical way, thinking about their expected utilization and mapping out expected costs and associated risk under each plan 14 First Quarter 2016 * XXX 5IF*)$$ DPN * HealthCare Exchange Solutions™

design. Instead, they tend to choose plans based on advice from a friend, familiarity with the plan, recommendations and branding. However, they are also influenced by real-time decision support.

In our simulation survey, we observed differences in plan election behavior for respondents presented with decision support and recommendations embedded in the survey compared to those who were not. In particular, respondents in certain groups — for example, lowincome families or those expecting a pregnancy — were very sensitive to decision support. (For more detail, see our report on micro-segmentation.

Additionally, respondents tended to be anchored by an initial default plan design, even though it was randomized. For example, in the open-choice environment, we mapped the initial randomized plan design and associated contribution to the final choice respondents made, and found a strong correlation between the initial contribution and the final contribution of the designed plan. (For more detail, see our report on The Paradox of Decision Support in Health Plan Choice.)

Based on our survey results, we believe that decision support during the selection process helps employees choose plan designs more aligned with their true preferences by presenting more information, more accurate cost expectations and the ability to compare costs across plan options in

Based on our survey results, we believe that decision support during the selection process helps employees choose plan designs more aligned with their true preferences by presenting more information, more accurate cost expectations and the ability to compare costs across plan options in the moment. the moment.

Additionally, in our satisfaction surveys of employees enrolled in our exchanges, 92 percent say that the information they received during the selection process helped them make informed choices.

Implications for Employers Our research showed that while employees need and want choice, most do not fully understand how health plans work, making it difficult for them to make the most appropriate choice for themselves and their families.

Employers today are providing employees with education and guidance, but it is likely presented primarily through primers, enrollment guides and FAQs offered in traditional print and online formats and disconnected from the actual health plan decision-making and enrollment process. Our research paints a picture of the optimal health plan election environment as one that provides meaningful choice and proven decision support tools that provide real-time, step-by-step guidance in the form of definitions of key terms, cost calculators and ultimately, a small set of recommended options tailored to each employee’s needs. • Private exchanges can play this role. When evaluating options, we advise employers to consider the following questions: • Is decision support embedded within the decision-making and enrollment flow? • Is there a dynamic recommendation engine that can quickly gather data and produce recommendations individualized for each employee and their family based on health and financial needs?

•

Does the decision support have a track record of results in areas such as employee satisfaction and outcomes, as demonstrated by the choices made?

If the answer to these questions is “yes,” employers can have greater confidence that their employees are equipped to make decisions that are right for them from an expanded array of options.

Sherri Bockhorst is a managing director of Willis Towers Watson’s Group Exchange business. Andrew Mackenzie is a senior actuarial analyst of Willis Towers Watson’s Health and Benefits consulting business.

________________________________ 1 For access to complete findings and insights, visit Understanding How Employees Make Their Health Plan Elections.

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+1.678.797.8506 healthcare@tsys.com www.tsyshealthcare.com

BY KAMI HAYNES DIRECTOR OF MARKETING TANGO HEALTH

ACA COMPLIANCE

Making the Most of the Cadillac Tax Delay If tax revenue isn’t coming from the Cadillac Tax any time soon, the IRS is likely to get much more serious about collecting other ACA-related fines and penalties in an effort to balance the books — increasing the need to make sure you’re in full compliance.

Making changes starts with examining each of the plans you offer to see if total costs exceed the threshold. The “total cost” includes the premiums paid by employers and employees, plus any contributions to health savings accounts, as well as the cost of any employee assistance plans that offer counseling benefits, onsite medical clinics and wellness programs.

You’ll be taxed 40 percent on every dollar of that cost that exceeds the threshold of $10,200 for an individual or $27,500 for a family. With that math in hand, you can start to identify and phase out high-cost plans that will increase your tax liability.

2. It’s a great incentive to rethink how you’ve been talking about benefits. istock.com/Sujaimages2

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n December 18, 2015, Congress passed and the President signed a two-year delay on the Cadillac Tax, the 40 percent excise tax on highcost health plans, moving the effective date of the tax from 2018 to 2020.

It may be tempting to see these extensions as the beginning of the end of the Cadillac Tax. But because it was designed to help pay for subsidies and exchanges that are already in place, it’s unlikely that we’ll see the Cadillac Tax completely vanish. In fact, the Congressional Budget Office estimates that once it does take effect, the Cadillac Tax will generate more than $80 billion in revenue in the first ten years — which is a compelling reason for the IRS to keep it on the books.

That’s why the more proactive approach is to continue preparing for the Cadillac Tax as though nothing’s changed. Use this time to assess your organization’s health benefits offerings and make some intelligent changes — ones that not only reduce potential tax exposure, but also benefit employees and your business in the long term, regardless of what happens with ACA regulations over the next few years.

Here are three reasons why gearing up for the Cadillac Tax is still good business:

Phasing out current high-cost plans means that employees covered by them will need to move to different plans, such as consumer-directed health plans with HSAs. Employees will most likely have to pay more of the costs of their care and will need to become more conscious consumers when making medical decisions. While that involvement is a positive change in the larger picture, employees may initially perceive the shift in cost as a big downside for them.

1. It gives you time to get out of harm’s way.

3. Your CFO will be happy to see you.

While this controversial tax may change, the underlying reasons for it won’t. As mentioned earlier, the revenue that will be generated by the tax is a primary reason. (Here’s something else to consider: If tax revenue isn’t coming from the Cadillac Tax any time soon, the IRS is likely to get much more serious about collecting other ACA-related fines and penalties in an effort to balance the books — increasing the need to make sure you’re in full compliance.) But those fines aren’t inevitable, and the delay gives you more time to make changes that will reduce or eliminate your exposure.

Chances are that your CFO has been hearing the same old story for years now: The cost of health care benefits keeps going up. But by working to identify and reduce exposure to the Cadillac Tax, you’ll actually be working to reduce the financial, operational and IT costs associated with benefits for the company, as well as to improve the effectiveness of the coverage you offer. That’s something any CFO will be happy to hear. And if your company is a public company, the CFO will also be extremely relieved to avoid having to report to shareholders that they’re paying a hefty tax that could have been avoided.

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WORKPLACE WELLNESS

BY JEFF BRIZZOLARA, PHD, MPH CHIEF CLINICAL OFFICER VIVERAE

Why Wellness Programs Often Fall Short

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or employees who are living with Employers who fail to offer disease or condition. For example, hypertension is a chronic condition, it’s often a a major contributor to congestive heart daunting experience to cope while failure. “chronic condition� management as balancing demands at home and at A program should also cover work. Without the proper treatment, part of their comprehensive wellness co-morbid conditions, which signify dealing with these illnesses can a program with a comprehensive program are missing the biggest disrupt one’s lifestyle in multiple ways, approach. If you can identify employees especially at work. Eighty-six percent of with primary chronic conditions before opportunity to help employees who the nation’s health care costs are used they develop a secondary chronic to treat individuals with chronic disease you can have a greater impact need it the most and realize enhanced condition, — many of which are preventable — on reducing the cost of health care and cost employers millions of dollars expenditures, increasing productivity productivity and better collective each year in terms of insurance claims, and improving quality of life. absenteeism and reduced productivity. business outcomes.

Employers who fail to offer disease or “chronic condition� management as Prevention is Key part of their comprehensive wellness program are missing the biggest opportunity to help employees who need it the most and realize Once an employee is diagnosed as having a chronic condition, they enhanced productivity and better collective business outcomes. are forced to deal with that condition throughout their entire life, making it all the more important to focus on prevention. There are many lifestyle behaviors that can affect overall well-being, such as stress, tobacco Get a Head Start use and lack of physical activity. Having services like health coaching in a program can prove effective at improving lifestyle behaviors and It’s important to identify at-risk members as early as possible, so reinforcing the importance of prevention. that health coaching can take place without having to wait for insurance Including health coaching as part of a comprehensive health claims to come through. This early identification process can occur management program can benefit individuals at all levels of risk, even through the collection of biometric screening results and information those who are relatively healthy. Without receiving any coaching, we from a member’s health assessment, as well as the self-reporting of know that up to 15 percent of members in low-risk categories will move conditions. More importantly, the identification of risks through different to a moderate or high-risk level within a first year. When coaching is means presents a unique window of opportunity in which an employee is added to a disease management program, employers can experience up likely to be highly motivated to engage in health improvement programs. to a 40 percent increase in engagement and sustained success.

Once an employee’s biometric results are received and health behaviors are examined, it’s best to set a plan in motion to keep their wellness at the forefront of their minds and promote ideal engagement. Targeted and Make it Accessible continual outreach can prove to be instrumental in getting an employee activated and enrolled in the program.

Your program should have multiple communications strategies to meet the needs of a diverse population, regardless of industry or job class. Whether in an office or working remotely, it’s important that Cast a Wide Net coaching is available through digital services or phone and during times most accessible to the employee.

In order to make a greater impact on the management of chronic Above all, look for a program that is clinically validated and conditions, it is important to look at the major contributors to these incorporates a comprehensive view of an employee’s overall health, which chronic conditions. There are initial health concerns that people live will more accurately identify members in need of disease management. with for quite some time before they develop into a more severe chronic

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BY STEVEN WILLEY, MD CHIEF SCIENTIST YOUPLUS HEALTH

DIGITAL HEALTH

The Power of Personalization for Company Wellness Programs

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ecently, we have seen an influx of companies implement wellness motivation. What people need from their employer is to be given programs into their organizations. With eight out of 10 companies the ability, which in this case means to be given a tool that creates a offering some type of wellness or health-related program, it is clear health plan for them that will work. that organizations see this as a solution to increase productivity, decrease • Engage: People are inundated with health information. This health care costs and maintain a high employee-retention rate. information comes from searching online, email blasts, friends, Unfortunately, these programs many family, colleagues and so many other times don’t accomplish these goals — often sources. It’s likely employees are due to the types of programs employers overwhelmed by the constant amount of choose. Some of the most popular wellness irrelevant health information that is in programs are cookie-cutter solutions with front of them. In order to truly engage a general set of guidelines or a fitness people in their health, they need to be challenge where employees are encouraged provided with information that matters to utilize wearable devices. Both options to them and to their body. For example, are problematic. somebody who doesn’t smoke should The issue with the cookie-cutter not be sent tips on how to stop smoking. option is that it does not treat employees However, a woman in her 40s with three like an individual person. Do all of your kids and a full-time job who is hoping employees have the same work habits? Do to lose weight would be interested in they all have the same physical shape and information on quick, 20-minute workouts Do all of your employees have the size? Do they have the same background that burn calories fast. and health history? No. Every employee same work habits? Do they all have differs drastically and has very different YouPlus Health completed a study health goals, so a one-size-fits-all wellness that was recently published in the Journal the same physical shape and size? program simply won’t cut it. of Medical Internet Research mHealth The fitness challenge option seems Do they have the same background and uHealth. We found that users of innovative at first, with employees eager YouPlus Health’s mobile app experienced to use their wearable device to track steps, significant reductions in body weight, and health history? No. Every but these programs also end up falling waist circumference, and both systolic and flat. Initially, the data may be fun to look diastolic blood pressures, while attaining employee differs drastically and at and compare with other colleagues; significant increases in HDL and VO2 has very different health goals, so a max. however, employees quickly realize there is no context around this data to help them The results came from asking our one-size-fits-all wellness program make sense of it and reach their overall users specific questions about themselves and specific health goals. and their health and creating a plan that simply won’t cut it. would work for them. Some people need So what is missing from these to take baby steps, some need structure in programs? Personalization. their life, and others just need a platform A personalized solution both empowers and engages an employee in to learn from. Whatever the case may be, it is very important that we his health: look at each employee as an individual person and work with them to • Empower: This can be accomplished by providing them with the successfully create changes in their lifestyle. proper tools, incentives and resources that give them the ability to make changes in their life. In order for people to change their Steven Willey, MD, chief scientist of YouPlus Health, is a St. Louis-based doctor best known for his innovative work on optimizing the human body’s metabolic performance. behavior they need to be motivated, have the ability and be given Dr. Willey attended Northwestern University Medical School and completed his residency appropriate reminders. Generally, most people have some level of at Stanford University.

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BECOME CERTIFIED IN HEALTHCARE CONSUMERISM (CHCC)

Be the go-to person for health care consumerism expertise in your organization and become recognized as a leader in the health and benefit management industry.

Through the IHC University program, The Institute for HealthCare Consumerism has established the industry’s first and only certification program for health care consumerism expertise. Either through online courses or a four-hour pre-conference class at each of our quarterly conferences, establish yourself as a leader in this fast-growing space.

For more information, visit theihcc.com/university.

Meeting Employers’ High Expectations for Health Care Consumerism

Self-funded employers have high expectations for health care consumerism. As part of those expectations, they want their employees to have an easy-to-use tool to become active consumers who find out what health care costs before getting treatment. They want to effectively promote the tool so employees know they have options. And they want to know how and when consumers are using cost information as part of their decisions about where and when to seek care.

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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BY CHERYL DEMARS » PRESIDENT AND CEO » THE ALLIANCE

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Offering the Right Tool The Alliance set out to meet these needs by creating the Find a Doctor site. The Alliance is a cooperative of more than 240 employers who self-fund their health benefits in Wisconsin, Illinois, Iowa and Minnesota.

Find a Doctor offers health care cost information to users who log in, which is required by Alliance contracts with hospitals, doctors and other health care services in The Alliance network. Provider names and location, as well as quality information, are available without logging in.

Find a Doctor was developed in cooperation with Doctor.com, a company with experience in developing provider directories. Creating a transparency tool was time-intensive, but working with Doctor.com offered greater flexibility for shaping the consumer experience. The tool was launched to consumers in August 2015.

The Alliance also shares data to support online directories and decision support tools offered by some of its members directly to employees. These members are typically larger employers and insurance trusts.

Building Usage From the beginning, it was clear that launching Find a Doctor would require reaching out to consumers to explain the difference between a cost-and-quality transparency site and a typical online directory. So The Alliance developed a business-to-business-to-consumer promotion campaign to help employers share information with consumers.

B2B2C means that The Alliance reaches out to employers, who then deliver the message to consumers. The campaign relied on creating an online toolkit so employers could download materials to share with consumers. Some printed materials were also provided. The toolkit offered emails, posters, newsletter articles, social media messages and other materials. Employers could also schedule a workplace presentation to educate employees about Find a Doctor.

While The Alliance aimed to make information easily available to employers, their employees and their business partners, it quickly became apparent that nuances mattered. For third-party administrators, for example, it wasn’t enough to describe what Find a Doctor could do for consumers. TPAs are a vital audience because they often provide employee benefit information, including links on benefit intranets created on the employers’ behalf. To get TPAs’ attention, Find a Doctor had to be described as a “transparency tool�.

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much information. So the message was pared to essential ways to learn about cost and quality, which was reinforced with videos and visuals.

Because only logged-in users can see cost information, all the materials emphasized the importance of logging in to learn more.

Contest Offers a Boost As usage continued to grow, The Alliance looked for ways to build a positive buzz in the workplace. In December 2015, The Alliance launched a contest that offered a $250 gift card as the grand prize, with five $50 gift cards as additional prizes. The contest was open to anyone who uses The Alliance network to access care. To qualify, users needed to register for the site and log in.

A special communications toolkit was created to support the contest with a new set of materials. Employers were enthusiastic about sharing the news, which gave the contest and Find a Doctor added exposure.

Over six weeks, the contest attracted 1,010 new users, which continued to grow after the contest ended. On January 15, 2016, Find a Doctor had a total of 3,054 current registered users from 228 of The Alliance’s 240 employer members. These registered users represent 4.6 percent of the 65,853 members who rely on the Find a Doctor directory, which excludes members whose plan sponsor directs them to a another tool or directory.

Since people can use some features of Find a Doctor without logging in, it’s worth noting that the site has had more than 50,000 user sessions since its launch.

Hold-Your-Own Contest The Alliance carried on the success of the log-in contest by asking employers to hold their own contest. The Alliance provides a $50 gift card to serve as a grand prize and encourages the employer to offer additional prizes.

An updated employer toolkit supports the contest. The Alliance also promises to support the contest with a workplace presentation by Alliance staff and a direct mail or email campaign to reach employees and family members.

In the future, The Alliance intends to encourage new employers who join The Alliance to hold their own contest to build employee awareness right from the start.

The Alliance has also begun a campaign to encourage enrollees to share the story of how they have used Find a Doctor information to save on health care costs or make better health care decisions. Over time, the cooperative plans to turn these stories into testimonials that will persuade more consumers to use Find a Doctor

when making important health care decisions where cost and quality play a role.

Refining the Experience The Alliance has continued to work with Doctor.com to refine the consumer experience.

The search function was updated in December 2015 to emphasize searching by procedure, which is part of the process of comparing health costs.

A team of Alliance employees continues to meet to suggest site improvements and resolve issues. This team includes representatives of quality measurement, customer services, provider relations and marketing and member services.

The Alliance has also worked with employers to encourage the use of contextual messaging. Employers who are part of The Alliance design their own benefit plans, which means that each employer’s plan may have unique features.

Contextual messaging allows employers to offer customized information to people who are using the site for a specific type of procedure or provider. Users indicate who their employer is when they enter the site, which allows these messages to be triggered by a specific procedure or provider search.

For example, The Alliance offers the optional QualityPath program to help employers steer employees to high-quality hospitals and doctors for high-stakes procedures. Contextual messaging is used to remind eligible users who search for a qualifying procedure that choosing a QualityPath provider results in 100 percent coverage of medical procedure costs.

Addressing Challenges The Alliance continues to identify and address challenges to Find a Doctor’s success.

But the greatest challenge to Find a Doctor may be consumers’ ongoing lack of awareness that it’s possible to learn about cost and quality at the time when they are making health care decisions.

By working with self-funded employers in a B2B2C model, The Alliance hopes to use Find a Doctor to help a growing number of consumers learn that it’s possible to make better choices about health care cost and quality.

Cheryl DeMars joined The Alliance in 1992, assuming several roles before becoming CEO in December 2006. She works with the board of directors and senior leadership team to establish the strategic direction of the cooperative.

DeMars is a board member and former chair of the National Business Coalition on Health and serves on a number of state-based organizations, including the Advisory Board of the Wisconsin Population Health Institute and the Statewide Value Committee’s Leadership Council.

Three Ways to Use to Spend Less & Find Quality Care

1 Check the Price.

#

Find a Doctor can estimate the price of more than 70 procedures, based on costs charged to real patients.

You can even compare a cost estimate for a specific hospital or clinic to the lowest and highest prices charged within The Alliance® network.

Procedure

Office visit, 30 minutes Office visit, new patient Colonoscopy without biopsy Colonoscopy with biopsy Arthroscopic knee surgery

2

#

Look for the Symbols.

These symbols mean there’s more to learn.

Low

High

end of range

end of range

$30 $50 $1,370 $2,060 $7,010

$340 $490 $4,130 $8,560 $13,400

Price estimates as of June 2015.

The check marks hospitals or clinics in the “best price tier.”

Watch out for facility fees.

They range from $15 to hundreds of dollars. Some insurance plans refuse to pay these fees.

?

Place your cursor over the question mark to get more information.

3 Check the Quality. Find a Doctor can tell you:

#

› How a doctor’s office that offers internal medicine, pediatrics or family medicine is rated, based on whether doctors at that location: » Make good use of your health care dollars » Provide recommended care for your health issues at the right time. › How many stars – one to five – are earned by a hospital that has birthing care, based on deliveries by cesarean section and obstetrical trauma. › Whether a hospital got an A or an F on the Hospital Safety Score. Scores are based on how often people staying overnight in the hospital were harmed by injuries, infections or medical errors that occurred during their stay.

Log In and Learn More To use Find a Doctor, visit www.the-alliance.org and click the Find a Doctor button. Creating a login is required if you’d like to view cost estimates.

Need Help? › Call 800.223.4139, Monday through Friday, 8 a.m. – 4:30 p.m. › Email FindaDoctor@the-alliance.org.

Cadillac Tax Delay Provides Opportunity for Employers to Refocus Benefit Strategy

W

BY SETH SERXNER, PHD, MPH « CHIEF HEALTH OFFICER « OPTUM

hen Congress late last year postponed implementation of the Cadillac Tax, many employers welcomed the news. The two-year delay — it is now scheduled to begin in 2020 rather than 2018 — gives companies more time to find ways to reduce their exposure to the tax.

But the delay, by itself, does nothing to address ongoing cost pressures that are squeezing employers’ benefit plans. Indeed, the moratorium is unlikely to curtail many of the cost management strategies they’ve already implemented because, tax or no tax, employers must still contain medical spending.

Although experts are still debating whether the Cadillac Tax will become a reality in 2020, employers are exploring a variety of ways to minimize its impact, according to a survey completed last fall of large companies by Optum and The National Business Group on Health.

Rising Costs

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The need to control rising health care costs has taken on new urgency. After years of historically low growth, health care inflation is on the rise. Following five consecutive years of average spending growth of less than four percent annually, national health care spending grew 5.5 percent in 2014, and is projected to average 5.8 percent through 2024, according to the U.S. Centers of Medicare and Medicaid Services.

This increase is due in large part to the expansion of coverage under the ACA, the aging population and the rising cost of prescription drugs. Prescription drug spending, in particular, is expected to jump dramatically in the coming years, according to CMS actuaries who report that drug spending soared 12.6 percent in 2014, its highest rate of growth since 2002.

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The Cadillac Tax was designed to rein in high-priced insurance policies and raise revenues to help pay for the Affordable Care Act. The 40 percent excise tax is levied on the portion of group health care premiums that exceed certain dollar thresholds — $10,200 for single coverage and $27,500 for family coverage.

Nearly nine in ten employers we surveyed anticipate that they will be affected by the tax in some way by 2020 if they don’t make any plan design changes. The tax’s reach expands quickly, because it is tied to the general rate of inflation. Since health insurance premiums have been growing faster than the inflation rate, more and more health plans will be subject to the tax over time.

d

Nearly All Affected

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Last year, the average family health insurance premium for employer-sponsored health insurance rose four percent from 2014 to $17,545, according to survey research by the Kaiser Family Foundation/Health Research & Educational Trust.

wages to compensate for the benefit reduction: • 14 percent would increase wages by the same amount they reduce benefits • 39 percent would increase wages to partially offset reduced benefits • 48 percent would not increase wages

Mitigation Strategies

Boosting Wellness

According to our survey, many employers are concerned about the tax’s impact on their ability to offer competitive pay and comprehensive benefits, as well as the administrative burden of the tax calculation.

In anticipation of the tax, survey respondents said that they have already implemented the following strategies to minimize or avoid its impact: • Limited or dropped coverage for employees working less than 30 hours per week (28 percent) • Raised deductibles, co-pays (26 percent) • Implemented spousal coverage surcharges or exclusions (24 percent) • Limited or dropped retiree health coverage (24 percent) • Offered or expanded account-based health plans (higher deductible plans that are paired with health care accounts to cover out-of-pocket expenses) (22 percent)

Employers are also embracing strategies like population health management programs and centers of excellence networks which have the potential to help employers control costs while improving health care outcomes and employee quality of life.

How will health and wellness offerings be affected by the tax? According to our survey, more than a quarter of employers expect to expand their current wellness offerings and more than half will continue them in their current form. Fewer than one in five said they would discontinue certain wellness programs.

Our survey found that employers have already implemented several health and

And, should the tax become reality, employers are considering additional mitigation strategies including more diligent management of their pharmacy spend, expanding account-based health plans and dropping high-cost health plans.

According to the survey, nearly half of employers expect to reduce plan richness if they meet the tax threshold. That group is divided, however, about whether they would increase

42 First Quarter 2016 * XXX 5IF*)$$ DPN * HealthCare Consumerism Solutions™

• •

Offered or expanded telemedicine services (30 percent) Added clinical management programs such as disease management and case management (29 percent)

Additional health and wellness strategies that employers are considering include: • Relying on wellness vendors for dayto-day management of programs (44 percent) • Offering or expanding use of health advocacy triage service (43 percent) • Increasing wellness program incentives (43 percent) • Adding or enhancing clinical management programs (43 percent)

Centers of Excellence According to our survey, employers (particularly manufacturers) will also be expanding their use of centers of excellence in order to minimize or avoid the tax. Centers of excellence are hospitals and medical centers that have undergone a rigorous credentialing process to help ensure that they deliver high quality, cost-efficient care.

These facilities typically provide care to patients with complex, high cost conditions, such as cancer, heart failure, transplants and severe obesity.

Looking Ahead wellness strategies in response to the tax: • Charged higher premiums for tobacco users (39 percent) • Added or enhanced wellness programs (36 percent) • Increased wellness program incentives (32 percent)

Employers will continue to feel the pressure of rising health care costs, regardless of when or if the Cadillac Tax is implemented. That’s why taking a “waitand-see� approach isn’t an option. Employers who continue to adopt strategies designed to manage health care costs and improve employee well-being will have a leg up on their competitors.

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TELEHEALTH

BY MARY MODAHL CHIEF MARKETING OFFICER AMERICAN WELL

A Look at the Growing Employer Market for Telehealth

O

ver time, American Well has commissioned significant studies Employer Barriers to Telehealth on telehealth for all major stakeholders — from consumers to Among employers that were unsure when they would add telehealth, physicians and from health plans to health systems to ACOs. the overall theme was a need for education and information regarding the As part of our Telehealth Index series, in 2015 we turned our focus benefits of telehealth and potential ROI. Some employers are waiting for to employers, conducting a broad survey of the employer market to their health plans to offer telehealth first and planning to introduce it to understand its explosive growth and key trends. Companies of all sizes employees then. and from a wide breadth of industries responded. All told, our benchmark survey gathered over 240 responses from human resources benefits A Broad Vision for Telehealth Use Cases managers, brokers and others who purchase employer benefits. Our Employers have expansive vision when it comes findings confirmed what we’ve observed in our own business as more and to telehealth — it’s not just about urgent care for them. more employers come on board with American Well, both through our Today’s employers are invested in their employees’ health, health plan partners and directly — now is the time for telehealth. many of them offering wellness programs that work in We identified five key reasons employers are increasingly embracing tandem with telehealth. This was well represented in telehealth. our survey, with the top five use cases for both current • Reducing medical costs. The average telehealth visit costs and future services being general health assessments, $40, while an in-office visit is closer to $140, and visit to behavioral health, diet and nutrition services, diabetes the ER can rack up over $750 for even a minor issue. counseling and smoking cessation. Many employers • Improving access to care. This is critical at a time also expressed interest in more specialized when demand for care overwhelms the services including employee supply of physicians. With assistance, asthma counseling, American Well’s second opinion services and technology, pharmacy counseling. employees can connect with providers Improving Utilization 24/7 from their mobile Employers who operate telehealth phone, laptop, tablet, or programs have two main challenges: maximizing landline. utilization and getting adequate reporting. Half of employers o ark • Making employees happy. Using surveyed reported utilization of 10 percent or less. Many of our clients dom / m o ck.c isto telehealth give employees back at American Well are experiencing engagement above and beyond these control of their time, because they percentages because we work closely with employers, sharing the best can access care at their convenience from the comfort of their practices we’ve culled from our experience working with companies of own homes. varied sizes and across many industries. One strategy that our clients • Improving employee productivity. Telehealth allows have found particularly effective is setting a low co-pay for telehealth employees to take care of medical issues outside of the visits. Almost all employers we surveyed were employing this strategy. workplace, and it removes the stress associated with trying to Our survey also showed that there is a reporting gap — a shocking schedule, travel to, and attend an in-office visit during work number of employers didn’t even have utilization data for their telehealth hours. Some of American Well’s employer clients have taken service. With the right telehealth partner, the employer receives monthly this one step further, placing enclosed telehealth kiosks in the reports detailing utilization and other key metrics. These reports show workplace. patterns over time, and guide recommendations for future employee • Attracting new talent. Benefits packages are often the engagement campaigns. deciding factor when candidates are choosing between job offers—employers don’t want to look like laggards.

44 First Quarter 2016 * XXX 5IF*)$$ DPN * HealthCare Consumerism Solutions™

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EMPLOYEE ENGAGEMENT

H

BY BILL GAYNOR CHIEF STRATEGY & GROWTH OFFICER SPENDWELL HEALTH

Enabling Members to Be Responsible Benefit Utilizers, Incentivizing Them to Be Informed Shoppers

ealth care consumerism is a movement to empower consumers to take more financial responsibility and make more informed decisions, raise the consumer’s awareness of cost and quality, enable health care retail infrastructure and experiences, eliminate traditional system friction and waste and reduce the overall cost of care and benefit administration. Related health benefit plan designs typically offer incentives that have the possibility to positively impact a consumer’s behavior, health status and care seeking or utilization decisions.

Health care consumerism is designed to put the member/consumer at the center of health care. One example would be allowing individuals to save for future health care needs through health savings accounts. At a broader level, it involves creating a more sustainable health care marketplace. Gartner Inc. defines this solution market segment as “medical shopping.�

The latest trend in consumer-driven health care, given the recent shift toward health plans with higher deductibles and other out-of-pocket expenses, is to provide incentives for consumers to utilize tools to help them shop pre-service for value — considering provider cost and quality. The payer/ employer theory is that by offering consumer incentives and improving their access to information to cost and quality with improved navigation, costs can be contained or reduced and consumers become savvy health care shoppers.

According to a survey conducted by TransUnion Healthcare, more than 80 percent of Americans report that accurate upfront cost estimates (both consumer out-of-pocket and employer/health plan costs) would have a positive impact on their decision to continue using a provider1. When consumers are able to shop in a benefits-integrated marketplace for health care — just like Expedia for travel — where services are listed at known service prices, provider competition increases. “Benefits-integrated� does not mean exclusively using real-time eligibility, as most transparency tools currently use, due to the variation in support and completeness of eligibility response data from one health plan or TPA to the next. The ideal solution is an online marketplace that combines benefit plan design configuration with real-time electronic eligibility for the most accurate out-of-pocket cost estimation for consumers.

A key dependency of online medical shopping is real-time eligibility coverage information and year-to-date deductible accumulation balances. A recent industry poll of payers conducted by SpendWell Health revealed that less than 40 percent of U.S. health plans and TPAs surveyed support a realtime eligibility response (271) that: a) delivers response data that is more than member “coveredâ€? or “not covered,â€? and b) returns consumer year-to-date deductible accumulation information. Roughly 10 percent of payers surveyed return a real-time electronic eligibility response with year-to-date deductible accumulation balance information that is 48 hours old. Only one percent of U.S. employers surveyed knew if their health plan or TPA supports electronic real-time eligibility and why that was important to consumers’ and providers’ 46 First Quarter 2016 * XXX 5IF*)$$ DPN * HealthCare Consumerism Solutions™

experience. Employers were also unaware of how the lack of electronic realtime eligibility standard support by health plans and TPAs increases their administrative costs.

A major dirty little secret in health care is the lack of electronic transaction standards enforcement, utilization and proprietary modifications to electronic transaction standards specifications by health plans and TPAs. The health care IT industry joke goes, “If you’ve seen one 271 (real-time eligibility response), you’ve seen one.� The lack of mandated electronic standard regulatory enforcement and proprietary variation by health plans and TPAs creates an inconsistent pre-service shopping experience, inaccurate upfront member/consumer estimation or out-of-pocket collection, limited point of service decision making and an overall poor and expensive experience for both members/consumers and providers.

Health plans and employers would see satisfaction increase and medical and administrative costs decrease if: a) they produced electronic real-time eligibility responses that included year-to-date deductible accumulation, and b) they supplied consumers and contracted providers with a marketplace platform that goes beyond electronic real-time eligibility by integrating the actual benefit designs with real service prices.

Ongoing studies show that most providers are willing to lower their current fees up to 27 percent if patients pay their out-of-pocket cost share pre-service or at the point of service versus paying post-service. Additionally, health plans can lower administration costs through e-business efficiencies and build trust by assisting providers with their receivables. From an administrative cost savings perspective, health plans can save up to $12 per e-commerce marketplace order (per claim).

Wellness programs have demonstrated some advantages in the workplace but some still struggle with producing hard ROI, utilization and outcomes. Healthier consumers tend to spend less money on health care and employers understand that investing in their wellness is important for improved attendance and productivity. Employers and health plans should explore new ways to improve wellness program results by increasing consumer participation and empowering them to purchase services in their wellness plan directly from service providers.

The healthier consumers become, the greater the cost savings on health care and value created in the workplace.

However, consumer engagement and utilization is key to achieving the desired return on investment. So, what can employers and health plans do to motivate higher participation rates in their wellness programs? How about integrating your standalone wellness solution with an e-commerce platform that enables shopping and purchasing of routine health care services? Connect and integrate wellness programs with supply and demand continued on page 47

BY JESS MAXWELL MARKETING MANAGER COPATIENT

HEALTH CARE COSTS

Case Study: Helping an Insurer Save Over $450,000

C

opatient, a health expense management company, works with both consumers and business partners to offer customized solutions optimizing their cost containment strategy while enhancing member satisfaction.

Our client, an insurance company based in Portland, Oregon, offers group life, disability and individual short-term medical coverage with a commitment to providing high-quality insurance products that deliver financial security to their members. They were looking for a solution to help them reduce costs associated with high-cost medical claims.

Problem In early 2015, the client approached copatient with the goal of reducing the cost associated with their short-term medical claims. The client’s differentiated service offering allows their members the ability to select any provider when care is needed – not just a low cost or in network provider.

Although this model was attractive to their members, the costs associated with their strategy were becoming difficult to manage. Copatient identified and proposed a solution to both maximize the client’s discount in a provider-friendly way while also enhancing member experience. It was essential that the resolution copatient proposed met the needs of both the client and the members to be considered successful.

Solution Copatient implemented a customized solution based on their existing medical bill review and negotiation service to analyze short-term medical claims for discount opportunities. The client provides copatient claims for

analysis, where copatient’s reference-based price benchmarking analysis and proprietary software are applied.

From there, copatient’s team of experienced advocates negotiates with providers to optimize savings opportunities for both our clients and their members. Copatient is able to achieve discounts not normally available through secondary and tertiary networks based on their technology solutions and expertise in the space.

Results The results of this case study display copatient’s solution as a valuable asset in minimizing costs, eliminating provider friction and increasing member satisfaction.

• An 86 percent success rate was achieved on client cases sent to copatient.

• Data set included seven cases each over $100,000.

• Over $450,000 in savings were secured for the client.

• Improved member experience and reduced claims costs have been attributed to copatient’s solution.

• Additional service lines and solutions with copatient are under discussion for 2016 to increase cost savings and member satisfaction.

Copatient is the leading resource of solutions enabling consumers to better manage and reduce their health care expenses. Copatient helps consumers resolve billing errors and ensures that provider payments from consumers are appropriate for the services provided by using crowd-sourced data and a proprietary technology platform to perform an innovative bill analysis and negotiate payment. Copatient offers its medical bill review and negotiation and out-of-network claims management services to employers, brokers, health plans and TPAs.

Employee Engagement, continued from page 46

marketplaces to improve consumer value and empower service purchasing direct from providers.

A common incentive program is one in which employees receive redeemable reward points they earn for digital health reported exercise activities or healthy behaviors they pursue. While still evolving and not completely a causal link to better outcomes, this type of integrated digital health and financial incentive program creates a motivating community and fun experience where members can track their progress and see their results against competitive benchmarks.

Gift cards are a successful incentive as well. They allow consumers to choose the reward that best suits their interest and will be most motivating to them. Gift cards take the guesswork out of selecting the proper incentive and give consumers power over their reward redemption.

As consumers take on more of the cost of their annual health care expenses (premiums plus out-of-pocket), they are demanding better

information, better processes and better insight into what they get for those dollars. E-commerce-enabled marketplaces that are benefits-integrated and display known prices are the path forward in the transformation from the high cost, highly inefficient traditional health care ecosystem to the new optimal, retail-enabled health care economy.

1 TransUnion Survey: Providers Fall Short of Meeting Growing Patient Demand for Greater Healthcare Cost Transparency, TransUnion, June 23, 2014 Bill Gaynor leads SpendWell Health’s strategy and growth initiatives team, including marketing, business development and sales. His leadership responsibilities include strategy formulation, execution and resource development to achieve growth in revenue, customers, provider enrollment, consumer enrollment and platform utilization through relationships with key market stakeholders and leading technology vendors. Gaynor has a diverse leadership background in launching and growing enterprise software, systems integration, professional services, financial services and health care IT solutions with industry leaders such as Oracle, First Data, JPMorgan Chase and McKesson. Bill is a board member of the Healthcare Executive Group (HCEG), an AHIP-certified health insurance executive (CHIE) and is a certified Six Sigma Black Belt.

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

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AFFILIATE MEMBER PROFILES

WWW.THEIHCC.COM

The Institute for HealthCare Consumerism Affiliate Member Profiles The Institute for HealthCare Consumerism would like to thank all of its Affiliate Members for their support.

For information on becoming an Affiliate Member, please contact the sales team at sales@theihcc.com. payments.

Acclaris: Acclaris offers an integrated package of SaaS technology and services to support all account-based healthcare plans on a robust, private-labeled platform.

Aflac: Over 50 Million people worldwide have chosen Aflac because of our commitment to providing customers with the confidence that comes from knowing they have assistance in being prepared for whatever life may bring.

ARAG: ARAG® is a leading provider of voluntary legal insurance products and services for employers, membership groups and associations.

Arthur J. Gallagher: Arthur J. Gallagher & Co. is a world-wide leader in Commercial Insurance & Risk Management, as well as Benefits & HR Consulting. They now offer Gallagher Marketplace, a leading Private Exchange.

Avidia Health, a division of Avidia Bank, is an HSA marketplace leader, offering a No Fee product combined with personal attention. Headquartered in Massachusetts, Avidia Bank is an FDIC insured bank with accounts in all 50 states.

BenefitAlign: Benefitalign is a comprehensive, cloud-based platform that enables your organization to rapidly launch shopping and enrollment solutions, including Private Exchanges, across all lines of business.

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First Quarter 2016 I www.TheIHCC.com I HealthCare Consumerism Solutions™

Bloom Health is transforming the way employers use the range of workplace benefits to help attract, retain and motivate talent.

Certifi provides private-labeled premium and commission billing, payment processing, accounting, and remittance software and services to carriers, benefit exchanges, and administrators. Our proprietary technology uses accounting principles to provide true end-to-end membership accounting, from group and consumer invoicing to carrier & broker payment, and all associated financial reporting.

CodeBaby, founded in 2001 by two Canadian physicians turned gaming entrepreneurs (of Bioware), CodeBaby uses emotional engagement and gaming expertise to help millions of consumers make personalized and informed employee benefits and healthcare decisions.

Colibrium, Founded in 2005, Colibrium, delivers integrated software solutions designed specifically for the health insurance industry.

ConsumerMedical helps your employees answer the five most important questions in healthcare: What do I have? What do I need?

Where do I go? What will it cost? How do I connect?

DataPath, Inc.: DataPath creates solutions for the administration of consumer-directed healthcare benefit plans and insurance.

ebenefit Marketplace: Based in Connecticut, ebenefit Marketplace offers brokers nationwide the software and services to streamline benefits, HR and payroll administration through a private exchange platform.

Evolution1: Evolution1 and our Partners serve more than 9 million consumers, making us the nation’s largest electronic payment, onpremise and cloud computing healthcare solution that administers reimbursement accounts.

FAIR Health: FAIR Health is a national independent, not-for-profit corporation whose mission is to bring transparency to healthcare costs and health insurance information through consumer resources, comprehensive data products and research tools.

Fidelity, At Fidelity, our goal is to make financial expertise broadly accessible and effective by focusing on a diverse set of customers.

Hartville Pet Insurance Group: As one of the oldest and largest pet insurance providers in the US, Hartville Pet Insurance Group has committed itself to helping more pet parents have access to reliable and affordable pet insurance plans.

hCen tive hCentive is a provider of cloud-based technology that helps consumers connect, communicate and engage in acquiring health insurance benefit products.

WWW.THEIHCC.COM

AFFILIATE MEMBER PROFILES

Access these solution providers online at www.theihcc.com.

Own Your Healthcare

HealthExpense

TM

HealthExpense: HealthExpense helps health plans, administrators and employers increase engagement in healthcare marketplaces through simplified medical bill management, shopping tools and tailored incentives resulting in reduced healthcare costs.

Interactive Health: Interactive Health provides comprehensive worksite wellness solutions that are personalized for each individual.

Pantone 102c

Maestro Health: Maestro Health is the only technology-meets-service platform delivering the most complete, all-in employee benefits management solution for brokers and employers.

75% BK

MasterCard Worldwide: MasterCard is a global payments and technology company. It operates the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories.

RedBrick Health, a consumer health engagement company, helps create behavior change and clinically-meaningful improvements in objective measures like BMI, blood pressure and cholesterol.

Renaissance Dental: It is our goal to bring quality to all we do by providing flexible, innovative plans and exceptional customer service to individuals, groups, and dentists.

SelectAccount: SelectAccount has been driving innovation in medical savings accounts for over 25 years.

Intrepid: Intrepid goes beyond the typical expectations of the benefits consultant. We take the time to understand each client’s unique culture in order to implement the most progressive, creative solution to their benefits needs.

Jiff: Jiff reduces enterprise health care costs by using smart analytics, beautiful design, and the best digital health technology and services to deliver customized benefit programs for each employee.

KTP Advisors: KTP Advisors™ is a specialty advisory firm consulting in the areas of private exchange strategy and evaluations, retiree health benefits, and pharmacy benefit risk management.

Liberty Mutual: What started out as an experiment offering discounted auto & home coverage to employees over 40 years ago has become a way of business.

Maxwell Health: Maxwell Health, a fast-growing industry leader in health IT, is the first Health as a Service platform.

Modern Emergent Care: We are Atlanta’s only ER alternative. Less wait time. Less cost. Less hassle, than hospital ER. Upscale facility with state of the art diagnostic center. CT scan, Ultrasound, X-Rays and full Lab testing.

Solstice Marketplace: The Solstice Marketplace is a private exchange developed by health insurance carrier Solstice Benefits.

TailorWell is changing how brokers help small employers buy and manage health insurance and other employee benefits.

PayFlex, considered and described by clients as an innovative technology company, PayFlex, a subsidiary of Aetna, provides consumerdirected account-based solutions that educate, engage and empower employees to improve their health and financial wellbeing.

Paylogix: Paylogix solutions facilitate benefit communication, enrollment and administration for payment processing and secure data management spanning from promotion-topayment.

Tango Health - Tango Health Benefits Optimization saves organizations money, makes employees happy, and ensures Affordable Care Act compliance.

TSYS Healthcare: TSYS Healthcare partners with third party administrators, financial institutions and health plans to provide benefit payment solutions for customers with HSAs, HRAs, FSAs, cash accounts and lines of credit.

HealthCare Consumerism Solutions™ I www.TheIHCC.com I First Quarter 2016

49

AFFILIATE MEMBER PROFILES

WWW.THEIHCC.COM

The Institute for HealthCare Consumerism Affiliate Member Profiles

UMR is a third-party administrator (TPA), hired by your employer, to help ensure that your claims are paid correctly so that your health care costs can be kept to a minimum and you can focus on well-being.

Listen Live Every Friday at 11 a.m. (ET)

Vericred Inc. is a healthcare technology company enabling the transformation of the health insurance shopping experience.

Now on Blog Talk Radio! www.blogtalkradio.com/ theihcradio Twitter: @The_IHC

Viverae, Dallas-based Viverae®, is a total population health management provider with a proprietary, intuitive, and configurable web-based application, MyViverae, that meets members where they are in their health, from wellness to health management.

Email: dfield@theihcc.com

Join the conversation by tweeting or emailing your questions to us in advance, during or after each show:

ADVERTISING INDEX WellRight: WellRight is a provider of corporate wellness software and its solutions help increase the physical and mental well being of employees.

WiserTogether delivers better outcomes and lower cost by bringing clinical evidence and patient-reported ratings together in a personalized consumer experience.

Withings: Withings leads the connected health revolution. Our beautifully designed award-winning products bring long-term engagement and measurable health impacts to your workforce.

If you use the services of our solutions providers, please tell them you saw their ad in HealthCare Consumerism Solutions™.

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A Powerful Combination: HSAs and Health Care Exchanges Are you offering this key component?

Give your employees the power to control their health care costs by offering the BenefitWallet® Health Savings Account. Our turn-key HSA solution provides a customizable way to simplify benefits administration, lower costs, and encourage employees to take an active role in their health.

Learn more at www.mybenefitwallet.com. ©2016 Xerox HR Solutions, LLC. All rights reserved. BenefitWallet® is a trademark of Xerox Corporation in the United States.

# hellowork There’s nothing like the smell of compliance in the morning.

Even before that first pot of caffeinated goodness, we’ve got tax and ACA regulation on the brain.

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Visit adp.com/hellowork and see how we can provide a more human resource for your business.

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