We recently read an article on the benefits pro website in which the author, after reviewing an HBR study on benefits in the corporate world, argued that business should be taking a much more proactive approach in how they handle their employee benefits. We at Equinox could not agree more. There are a lot of problems in the world of healthcare and especially in delivering a great employee benefits package to your employees at a reasonable price. But, if we truly want to take control we must devote more resources to the problem.

Large employers are really going to be the ones driving the bus because they have more say on how their plan is structured and run. They have the option to shop prescription managers, networks, TPA’s and negotiate prices, in some cases, to a very high degree. They are also the companies that are able to identify trends within their organization and highlight areas where they could improve. These businesses usually will focus a large amount of their resources to identify new markets for opportunity and new areas where the company will grow. However, these are also usually the same businesses that have one or two people in the HR department trying to push paperwork for 150, 250, or 500 or more people on the plan. They don’t have time to think proactively, nor do they have the resources to do so. Until they are empowered to take a step back from the day to day paper pushing, healthcare in this country is not really going to change. Typically only large organizations with 1000 or more employees have a dedicated department to managing health care along with a wellness committee devoted to controlling costs and identifying issues. Even these are sorely undermanned however. So, what will it take?

The first step is putting better technology in place. Most businesses that operate with a some type of HRIS system are using a platform that basically replaces a paper process with a digital one. They don’t really save time and end up being just as much work, albeit in a different format, than their old process. Technology is meant to simplify this and many systems on the market do exactly the opposite because they expect the end user to be a savvy techie, which we know that most HR professionals are probably not as of yet. When I say savvy, I mean that they are aware of how API works, what an EDI transfer is and how to set it up as well as maintaining massive amounts of data via excel or access database. These are skills that HR departments just don’t have the time to manage or learn. So, the technology offering must be simple and backed up by a team who knows the problems that come up in HR departments every day. In addition to being simple, the technology should also span across all aspects of the employee life cycle. This can happen with one system to manage all aspects of the employees HR processes or multiple systems that “talk” to each other in real time. These are out there and they work!

But technology won’t solve the problems. It is only a tool to allow us to dedicate ourselves to the real task at hand and provide us with real data. HR teams need to be empowered from the top level to really have a chance at solving the problem of their healthcare spend. Health insurance and other benefits typically account for the second largest expense of an organization after their payroll so it deserves some serious attention. Having upper management involved in an ongoing, year round engagement will be the only way to truly start to address the problem.

On top of that, companies are going to have to embrace new benefit ideas that are outside of the box. Many businesses are just looking for a cheaper version of what they already have. Don’t like what the Blues are offering you this year? Try Aetna. etc….  But, looking at new models of insurance, or new networks to drive lower long term costs are key. Many areas of the country have access to ACO’s with very well established carriers. But employers hear “narrow network” and shut down the idea before they’ve even had a chance to explore how a plan like this can lower their costs, year in and year out. The other idea that companies should be embracing is the idea of a Pharmacy Manager who actually fights for them to lower claims instead of the manager that comes along with the health plan. If a company truly wants to take ownership of their health care dollars, having someone at the helm of the fastest growing portion of health care who is taking a proactive approach to manage their prescriptions is imperative. This could be painful as you make the transition but employees always adapt and they’re starting to expect more for all of the money they’re paying for their healthcare.

Making some of the prescribed and suggested changes may be painful and it may take time and patience. But, if you partner with the right team or teams and truly dedicate yourself to solving a solution, you won’t have to wait for the silver bullet promised by reform in Washington or elsewhere.

Here is a link to the article referenced at the beginning of this post.

Why Companies Don’t Hold Health Plans Accountable