An active year ahead for employer health plan RFP activity

Larger employers are already getting a jumpstart in thinking about continued health plan cost management for next year, with an acute focus on rethinking how health care is delivered, the employee experience and which vendors can best help them in fulfilling their wellbeing and engagement strategies.

For many, this will involve reassessing current vendors and exploring potential new partners as the health marketplace continues to evolve. Before they can proceed, however, they’ll have to answer two important questions:

  • What are their specific objectives from the health vendor evaluation process?
  • What decision criteria should they use?

For those seeking a health plan carrier or administrator, the top decision criteria remain unchanged. The 2017 Willis Towers Watson Best Practices Survey of 555 large employers found a strong interest in understanding the range of care delivery options and decision support or navigation resources now available.

At the top of the list, 94% of respondents believe the competitiveness of negotiated provider discounts and broad network access to be an important or very important factor in their health insurance decision process.

Companies examine a broad set of priorities when selecting health plan partners[1]

Competitiveness of the negotiated provider discounts 94%
Competitiveness of the vendor’s network access 94%
Competitiveness of the vendor’s total cost of care

(including discounts and impact of health engagement)

92%
Effectiveness of the account management services (e.g., partnerships, reporting) 89%
Offer a customer experience that puts a high value on easy-to-navigate features, ability to solve member issues quickly and enhanced member communication 85%
Effectiveness of the vendor’s health management 84%
Extent vendor has incorporated reimbursement methodologies based on cost, quality, improved efficiency and better outcomes 70%
Competitiveness of performance guarantees to monitor vendor outcomes 69%
Willingness to integrate with third parties (e.g., price transparency, high-performance networks, health management and disability vendors) 63%
Availability of centers of excellence 56%

While telemedicine has become widespread as a care delivery vehicle with 78% already having adopted it, expect to see a rapidly growing interest in behavioral health, centers of excellence, high-performance networks and decision-support tools. Regional and local solutions continue to be of interest where significant local populations and strong provider-based arrangements exist.

Pharmacy benefits are high on the list as well with 84% of respondents planning to evaluate PBM contract terms during 2018 along with a scrutiny of approaches to better manage opioid use and utilization of biosimilars in lieu of branded specialty drugs.

As part of a review of the broader employee experience, employers are also drilling down on health care customer experiences. Specifically, they’re paying more attention to health plan advocacy and navigation resources, “concierge” style patient support, stronger treatment decision support and a renewed focus on expert medical opinion/treatment decision support services. This latter category is one that is typically carved out from the health plan service provider and addressed by one of several third-party vendors.

Many employers are looking to adopt a holistic wellbeing strategy within the broader context of employee engagement

While 20% of respondents use such a service now, another 24% are planning to adopt the resource in the next two years. Given recent acquisition activity and the evolution of services in this space over the past year, review of existing arrangements or adoption of new ones is likely to be strong. Additionally, targeting key clinical conditions for better results is high on employer lists. These conditions include metabolic syndrome (76%), Musculoskeletal (69%), Cancers (67%), mental health (65%) and maternity/Infertility (53%).

Moreover, many employers are looking to adopt a holistic wellbeing strategy within the broader context of employee engagement as 72% of respondents plan to add wellbeing resources as a vehicle for differentiation. This push is anticipated to create considerable revisiting of current arrangements as well as exploration of new vendors as companies broaden beyond the focus on physical wellness to embrace a more holistic definition including emotional health, financial health and social wellbeing.

This broader definition plus the dual employer goals of linking to broader engagement strategies and better measurement of results will stimulate activity across traditional employee assistance programs, financial assistance and financial planning services as well as challenge old style wellness vendors versus broader portfolios of wellbeing services.[2]

While each employer will have different needs and priorities driven by their own data and objectives, the pace of change in the marketplace, and the promise of new alternatives will make for a year of reassessment of current arrangements.

After 2016-2017 when many employers were awaiting the outcome of health plan merger litigation and the future of the Affordable Care Act, employers are still moving their health care programs forward with more strategic goals and higher expectations. For those planning RFP activity, it’s essential to start work now. The decisions are more complex and the choices—as well as the opportunities—are more robust than ever.


 

[1] Note: Percentage responding ‘Extremely important’ or ‘Important’ to the question: “As you select or decide to maintain a health insurance carrier, how important are each of these items in your decision process?” Source: 2017 Willis Towers Watson Best Practices in Health Care Employer Survey

[2] Employers are also expanding their Talent Value Proposition by offering contingent workers access to these types of benefits through Stride Health.

About Randall Abbott

Randall Abbott is a senior strategist emeritus of the Willis Towers Watson Health and Benefits practice. Now retire…
Categories: Employee Wellbeing, Health and Group Benefits | Tags: ,

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