Large gaps seen in health perceptions vs. reality
Source: https://eba.benefitnews.com
By Tristan Lejeune
A new survey from Aon Hewitt, the National Business Group on Health and The Futures Company indicates that many American workers and their families — even those who know what it takes to get and stay healthy — have inaccurate perceptions about their own weight, condition and the cost of their health care. The survey results, released this month by Aon Hewitt, further indicate satisfaction and claims of positive behavior changes associated with participation in consumer-driven health plans.
More than 2,800 employees and their dependents covered by employer-sponsored health plans were surveyed about their thoughts, attitudes and behaviors toward health and wellness. Eighty-seven percent of respondents reported being in good health, yet more than half of those (53%) gave height and weight combinations that categorize them as having a body mass index in the overweight or obese categories. Only 23% of all respondents believe they are actually overweight or obese, when in reality that number is 34%.
“Employees want to be healthy, but many have an overly rosy perception of their health and may not see an urgent need to take action,” says Joann Hall Swenson, Aon Hewitt’s health engagement leader. “For others, the activities and stresses of daily life take priority over good health, and many consumers are unwilling to make sacrifices to improve their health.”
She says employers need to offer workers and their families “the necessary tools and resources that give them a realistic picture of their health,” then follow up by encouraging healthy decision making.
Consumers’ incorrect perceptions extend to cost, the survey finds. Total health care costs per employee were $10,522 last year, according to an analysis, of which employers paid $8,318. When asked, however, how much of their bill their employer pays, the average respondent guessed around half that amount.
“These survey results,” says Helen Darling, president and CEO of the National Business Group on Health, “underscore the challenges employers face as they seek to engage employees and their families in health improvement as a means to better managing rising health care costs. It is critical for employers to bridge the knowledge gap evident in this survey.”
It seems one way to do that is by offering a consumer-driven health plan, the survey reveals, as 60% of those in a CDHP say they have made positive behavior changes in regards to their health, including more preventive care (28%), seeking lower-cost options (23%) and more frequent research of health costs (19%). In addition, 63% of respondents say they would complete a health risk questionnaire for a monetary reward, and just under that would engage in a healthy eating or weight management program.
“Consumers are looking for solutions that address their specific health needs and concerns,” says Christine Baskin, senior vice president at the Futures Company. “Tailored, targeted feedback such as that given in the HRQ process, along with understanding individual consumer's attitudes towards health, are essential ingredients to having employees take actions to improve their health and their lifestyle.”
Prevention Success Starts with Education
It's a common-sense notion that if you want to keep your employees from racking up huge costs on your company's health care bill, you should help them prevent or treat the illness before it becomes a chronic and costly problem.
Many employees, however, still seem to be stuck in the dark when it comes to the true costs and benefits of preventive services.
For example, employees in high-deductible health plans (HDHPs) have a history of failing to take advantage of preventive care services, and a new study reveals why: Many workers think their deductible applies to all doctor visits, including preventive appointments.
The study by Kaiser Permanente and reported by Kaiser Health News, that fewer than one in five polled California employees enrolled in HDHPs understood that preventive services were either fully covered or mostly covered under their plans.
"Patients usually have a pretty limited understanding of the details of their health insurance plan," Mary Reed of Kaiser Permanente told KHN. "Even when plans are designed well or thoughtfully, if patients don't understand they probably won't behave accordingly."
For employers and employees, a lack of preventive care can turn into higher costs in the long term, but employers have a short-term incentive to push preventive services, a new study reported by the Society of Human Resource Management (SHRM) suggests.
The report notes that solid health promotion efforts that prevent health risks can result in a drop in health costs in the first year of implementation. While employers can't reduce the presence of high-cost cases entirely, "an ongoing focus on prevention can benefit the entire population by avoiding chronic disease altogether," which can lead to an average savings of $100 in costs per employee per eliminated health risk during the first year, the study's authors told SHRM.
Luckily for employers, workers are eager to become better health consumers and take charge of their own health, according to a survey by Wolters Kluwer Health, as reported in Becker's Hospital Review. The survey found that 80 percent of respondents said the idea of employees taking more responsibility for their own health is a positive trend, and 76 percent said they already possess the right tools to become skilled health consumers.
Who Knew? Patients’ Share Of Health Spending Is Shrinking
Source: https://www.kaiserhealthnews.org
By Jay Hancock
KHN Staff Writer
Consumer-driven medical spending may be the second-biggest story in health care, after the Affordable Care Act. As employers give workers more "skin in the game" through higher costs from purse and paycheck, the thinking goes, they'll seek more efficient treatment and hold down overall spending.
But consumers may not have as much skin in the game as experts thought, new government figures show.
Despite rapid growth in high-deductible health plans and rising employee contributions for insurance premiums, consumers' share of national health spending continued to fall in 2011, slipping to its lowest level in decades.
"I'm surprised," says Jonathan Gruber, a health economist at the Massachusetts Institute of Technology. "All the news is about the move to high-deductible health plans. Based on that logic … I would have expected it to go up."
True, medical costs are still pressuring families. Household health expense has outpaced sluggish income growth in recent years, says Micah Hartman, a statistician with the Department of Health and Human Services, which calculates the spending data.
But from a wider perspective, consumer health costs continued a trend of at least a quarter-century of taking up smaller and smaller parts of the health-spending pie. Household expense did go up. But other medical spending rose faster, especially for the government Medicare and Medicaid programs.
Economists measure three kinds of consumer health costs: insurance premiums paid through payroll deductions or for individual policies; out-of-pocket costs for deductibles and co-pays; and Medicare payroll taxes. Such outlays fell to 27.7 percent of the health care economy in 2011, down from 28 percent in 2010 and from 32 percent in 2000, according to the national health expenditures report issued by HHS last week.
That's in spite of the fact that one worker in three is covered by a plan with a deductible of at least $1,000, up from one in 10 in 2006, according to the Kaiser Family Foundation. (KHN is an editorially independent program of KFF.) Among small firms, half the workers are now in high-deductible plans.
One factor holding down costs even for families with consumer plans has been patent expirations for expensive, commonly used medicines such as Prevacid and Flomax.
"People these days are spending a lot less out-of-pocket on prescription drugs," said Peter Cunningham, director of quantitative research at the Center for Studying Health System Change. "A lot of that has to do with the shift from brand name to generics."
Nobody thinks consumer-driven medicine has run its course. Insurers and employers are still building tools for patients to shop for care by comparing costs for MRI scans, for example, or researching hospital quality records.
High-deductible plans are expected to win a large share of the business sold next year through the health law's state insurance exchanges. Many companies say they intend to offer high-deductible insurance -- especially plans with tax-favored health savings accounts -- as the only option.
"I've heard of nothing but acceleration" of employers into consumer-directed health insurance, said Roy Ramthun, a benefits consultant who was a senior health policy advisor in President George W. Bush’s administration. "More local units of government, school districts and even some union plans are starting to move more aggressively into these areas."
High deductible plans are already getting credit for helping with an overall slowdown in medical spending growth. Among other factors, economists suspect that the prospect of higher wallet costs has made consumers even more likely than usual to avoid doctor visits in the middle of a sluggish economy. (Public health officials fear this will backfire with a later spike in illness.)
Sooner or later, households’ share of the medical-cost pie will start to get bigger, analysts say. The declines have been getting smaller, suggesting the trend will reverse.
One reason is continued growth of high-deductible plans. Another is that, starting in 2014, the health act requires individuals to start buying coverage or pay a penalty. Another is that federal health spending has risen more than three times as fast as consumer health spending since 2007, which can’t continue.
Even with recent tax increases on high-income households, the huge Medicare program for seniors and the disabled is growing at an unsustainable pace, says Joseph Antos, a health economist at the pro-markets American Enterprise Institute. That means Medicare, too, will need to seek higher premiums, deductibles or co-pays from the patient’s pocket, he said.
"Medicare is on a fiscal slide," he said. "Things are going to have to happen. Eventually, whether you call it premium support or not, we’re going to have to move to some kind of budgeted system in Medicare."
Employers Sample New Ideas to Chop Costs
Self-insured employers increasingly are testing new plan designs and tougher negotiation tactics with providers in hopes of discovering new and better ways to tamp down health care costs.
The first step for employers, Rost said, is to examine their current plan and determine areas of failure. Once data are gathered on who is using what services (and how they're using them), employers can work on building the best network and designing incentives that will guide workers to providers who understand the value-based philosophy and will deliver the best care at the best price.
Beyond the plan design, self-insured employers can take a number of other steps to make their health plan better, according to Karrie Andes, a senior benefits manager for PGi. In a recent article for Employee Benefit News, Andes offers a number of tips to help self-funded companies secure the best plan, including:
- Try to negotiate rates upfront for two or three years
- Be aware of any limits on claim audits
- Explore savings by carving out disease management, pharmacy benefits and other features
- Look for a transparent pharmacy model, which allows the pharmacy benefit manager to pass full rebates to your company
Although managing a self-funded plan can be a challenge, the concept has its benefits, according to a recent report by Kaiser Health News. Self-funding can offer significant savings for companies by reducing administrative costs and allowing them to offer a single plan across state lines, the report noted.
Companies Recommit to Smoking Cessation
While workers' waistlines remain a prime target in many employer-sponsored wellness initiatives, companies also are deploying aggressive anti-smoking programs in hopes of controlling health care costs, experts say.
Amy McAllister with Provant Heath Solutions noted in a recent Employee Benefit News report that her company has seen a strong uptick in the use of tobacco cessation initiatives.
McAllister said more employers are shifting their wellness programs to include a "total-body" approach, and that means tackling smoking among the workforce.
Provant's clients are using a mix of "carrot and stick" methods to encourage employees to participate, she said, including higher premiums for workers who refuse to quit.
Although the health benefits of kicking the habit are widely known, employers often overlook some of the legal snags that can occur with a smoking cessation program -- especially if it involves tests to make sure workers remain compliant.
"The issue of nicotine testing is complicated not only by the presence of smokers' rights laws and lifestyle statutes in certain states, which prohibit employer interference in off-duty conduct, but also by questions regarding disability and privacy," said Julie B. Ross of the law firm Lynn Ross Smith & Gannaway, according to Human Resource Executive Online.
Although no court has ruled that nicotine addiction is a disability, recent amendments of the American with Disabilities Act may make it easier for employees who are fired or penalized for failing a nicotine test to win legal battles with employers, Ross said.
Callan G. Carter, a partner at Fisher & Phillips LLP, noted that communication and test administration can further complicate programs that require testing. These challenges often convince employers to limit their scope of testing programs.
"I find that most employers allow employees to self-certify their tobacco use status and only test an employee for nicotine if the employer has a reason to believe the employee may be using tobacco after they have certified otherwise," Carter told HREO.
Still, the pressures of health care costs likely will continue to persuade employers to lean on anti-smoking programs and other initiatives that promise to drive down costs. A recent report by Adecco notes that 55 percent of executives rank health care costs as their No. 1 worry -- beating wages, taxes and talent retention.
That high concern about health care costs means companies should expect the trend of more smoking cessation programs and tobacco testing to continue, experts say.
10 tips for saving money on health care
By Kathryn Mayer
Source: www.benefitspro.com
Though we argue a lot about what solutions we need to fix our country's health care industry, we can usually at least agree on what one of the problems is: It's too expensive.
According to a recent survey, more than half of Americans see high costs associated with medical care and health coverage as the most pressing health care problem. Even more, health care costs are keeping patients away from the doctor with about one in three saying it has made them put off medical treatment and skip or postpone a regular doctor’s visit.
“Medical costs are among the biggest budget busters, especially when health issues are unexpected,” says Mike Sullivan, director of education for Take Charge America, a national non-profit credit counseling agency. “While some bills can’t be prevented, you may be surprised that you can drastically cut your overall health care expenses by questioning, negotiating and shopping around.”
Sullivan offers the following 10 tips for saving money on health care.
Stay healthy
First and foremost, commit to healthy living. Eat well, exercise and steer clear of unhealthy habits like smoking and excessive drinking. According to the Kaiser Family Foundation, medical expenses for an obese person are about 42 percent higher than someone of healthy weight. Likewise, the Center for Disease Control and Prevention says it costs 18 percent more to insure a smoker.
Take preventive action
Preventive care is crucial for keeping health care costs down over time, and many insurance plans now provide preventive-care screenings without charging deductibles and copays. Annual well-visits give your doctor an opportunity to provide necessary medical advice and identify health concerns before they become major issues.
Choose in-network providers
If you have medical insurance, choose in-network health care providers to keep your out-of-pocket costs down. This applies to your family doctor, specialists, health care facilities and even medical labs.
Assess urgency
If you need to see a doctor after hours, consider an urgent care or convenience-care clinic over the ER. You can save hundreds of dollars for relatively minor issues like a sprained ankle or the flu.
Maximize your deductible.
If you’re close to meeting (or have already met) your insurance deductible, schedule any necessary medical procedures or physician visits in the same calendar year. Your deductible starts over at year’s end, and waiting to schedule procedures means you’ll pay a larger share of the cost.
Inquire about medical necessities
Some medical procedures are urgent and necessary, others are less so. If money is tight—especially if you’re a private-pay patient—ask your doctor about the feasibility of delaying your procedure.
Negotiate costs
If you need to see a doctor and you’re paying out of pocket, be sure to compare prices. It’s important to know, too, that many providers will negotiate prices or provide cash discounts to private-pay patients. While the ER is no place to barter, consider this tactic for non-urgent or elective procedures.
Review your coverage
If you’re self-insured, review your coverage annually to make sure you’re not under- or over-insured. If you’re insured through work, evaluate your plan during open enrollment. With health-care reform changes and a variety of insurance plans to choose from, the coverage you selected last year may no longer be the best option.
Find Rx discounts
Many pharmacies extend special offers on prescription drugs. One pharmacy may advertise a $4 cholesterol medication while another may offer a low-price on blood-pressure meds. Be sure to shop around. If you have multiple prescriptions, it may be more cost effective to fill them at separate pharmacies. Additionally, ask your doctor to prescribe generics whenever possible.
Consider online and mail-order prescriptions
Search Web and mail-order pharmacies for deep discounts. Some even offer a three-month supply of drugs for the same price as one month at a neighborhood pharmacy.
Eight tips for employees during open enrollment
Source: https://www.benefitspro.com
It's open enrollment time again.
And with new regulations in place because of health reform, as well as ever increasing health costs, employees can use all the help they can get.
“Employers are making more changes than ever to their benefits plan designs and as a result employees need to take extra precautions to assure that they have the benefits coverage they expect, for a price they can afford, during this year’s open enrollment period,” says Cynthia Weidner, vice president H&W consulting, HighRoads.
HighRoads offers eight tips to employees so they can make the most of their benefits plans, while saving money.
Get your plan materials.
Pay attention to how your employer is making your SBCs and the traditional Summary Plan Descriptions available to you. Many are making them more accessible online, via mobile apps as well as on paper. It’s good to know how you can access this information during open enrollment and throughout the year, in case you want to review it again when you are in need of a particular medical service.
Do your homework.
Take the time during open enrollment to truly read through your plan materials, including the SBCs and SPDs, to make yourself familiar with each of your plan options. Reading each of these materials will give you the detailed plan descriptions you need to decide on the best plan for you and your family in the coming year.
Calculate your costs.
Many employers provide cost calculators to help project your total cost for the coming plan year. The total cost includes the premium you pay as well as your share of the deductible and coinsurance. Take the time during open enrollment to think through your potential medical needs and calculate your anticipated expenses before selecting a plan. It may save you hundreds in the long run.
Consider an account.
If your employer offers you the option of a health care account, whether it is a flexible spending account, a health reimbursement account or a health savings account, take a good look at it. These accounts can help you save money on qualified medical expenses that aren’t covered by your health care plan, such as deductibles and coinsurance. Each account has a different set of rules about how and when you can spend the money, but each are worth considering because the savings you’ll see can add up quickly.
Ask if you have a grandfathered plan.
One of the benefits of health care reform is an extended list of preventive care benefits that must be offered by new health care plans for free. Preventive services such as colonoscopy screenings for colon cancer, pap smears and mammograms for women, well-child visits and flu shots for all children and adults must be offered without out-of-pocket costs.
However, these benefits are only for new health plans and don’t apply to “grandfathered” plans that haven’t significantly changed in a few years. Find out if your plan is considered to be “grandfathered” and identify exactly what preventive services are covered for free.
Prepare for the unexpected.
Everyone needs to be prepared for the unexpected, including job loss, divorce or other life-changing events. Be sure you know what the benefits plan costs might be if you need to pay for it under COBRA.
COBRA requires that most employers with group health plans must offer employees the opportunity to continue temporarily their group health care coverage under their employer's plan if their coverage otherwise would cease due to termination, layoff, or other change in employment status (referred to as “qualifying events”). However, COBRA insurance must be paid entirely by the former employee. Be certain that if you need to continue your company’s health coverage that you are comfortable with the full premium cost should you need to pay for it on your own.
Use wellness incentives.
More employers than ever before are offering incentives to employees and their family members for health improvement. These incentives may come in the form of medical premium discounts, access to certain low deductible plans or even incentives and prizes. Some employers even offer to put money in an employee's medical account as an incentive. Take the time to learn everything your employer offers. You may find that you are already leaving money on the table because you have a gym membership or participate in a weight loss program that qualifies for an incentive from your employer.
Know your deadlines.
No matter what changes you may make, if any, during this year’s open enrollment period, don’t let your selection deadlines slip by without action. Doing nothing could end up costing you hundreds in 2013 in higher premium costs, lower coverage, or missed opportunities to optimize your health care dollars. Missing your open enrollment deadline will mean that you have to wait it out a full year before making changes that can help pad your bank account.
55 billion reasons for consumer-driven care
Source: Benefitspro.com
In a report this week, we found out something we already knew—but probably not to this extent.
Our country’s health care system squanders a ridiculous $750 billion a year. That’s roughly 30 cents of every medical dollar spent. It happens through unneeded care, excessive administrative expenses and data, fraud and other problems, a report by the Institute of Medicine revealed.
Let’s go over some numbers. America spent $2.6 trillion on health care last year. And a third of that spending did nothing to make any of us any healthier. Our health care costs are rising faster than inflation, and it’s literally bankrupting many of us. It’s also killing us. By one estimate, the report says, roughly 75,000 deaths might have been averted in 2005 if every state had delivered care at the quality level of the best performing state.
So what is going on?
The report breaks down the sources of overspending: Unnecessary services tops the list at $210 billion, followed by inefficiently delivered services ($130 billion), excessive administrative costs ($190 billion), prices that are simply too high ($105 billion), fraud ($75 billion) and missed prevention opportunities ($55 billion).
Though we’ve come a long way in health innovation—such as the management of previously fatal conditions—the report said, the American health care system is still falling short on “basic dimensions of quality, outcomes, costs and equity.”
Not that this is news. We know this. It’s apparent every time we see health report numbers or look at our own medical bills.
The question is what we can do about it.
The Institute of Medicine has recommendations: Fully adopt mobile technologies and electronic health records; increase transparency about the costs and outcomes of care; use better data; and move toward a system that rewards doctors for quality, not quantity, of care.
Sure, these are good ideas, but whether they'll happen any time soon is really a mystery. Sadly, it’s out of consumers’ hands.
But preventive care isn’t. There’s something each of us can do—get checked, get necessary and recommended health screenings, eat healthy, exercise, don’t smoke, be proactive about problems—the list goes on. Older people, the report notes, have a big problem with preventive care, and it’s especially problematic because they're more prone to serious and costly health woes.
It’s also worth noting that the report comes at an interesting time. The presidential race is tighter than anyone thought—and health reform and Medicare cuts are sources of major contention. President Obama didn’t even give mention the signature piece of his presidency, the PPACA, during his nomiation acceptance speech at the Democratic National Convention.
Seems like there’s a lot we—and Washington—can do to drastically cut health care costs while also improving care that doesn’t cost another trillion or so dollars to implement.
Food for thought
BY DENIS STOREY
May 1, 2012
Source: Benefitspro.com
If you’ve been paying attention to my rants over the years, it doesn’t take long to figure out how much I scream the paint off the walls about obesity in this country. It’s such a singularly classic representation of the worst of us.
“I’m free to do what I want. I’ll pay for it. And if I can’t, somebody else will.”
But even if I’m overstating the significance of our collectively burgeoning waistbands, obesity still stands (or sits) as probably our single greatest (remaining) preventable health care cost driver.
Now I’m no longer a lone voice in the wilderness. A handful of new studies just dropped that actually spell out some of the hard costs our soft bodies are ringing up.
The bottom line is obesity can now be tied to $190 billion in annual health care costs—more than 20 percent of the total we spend every year, according to a study in the January issue ofJournal of Health Economics. This is apparently twice the estimates of most experts.
Even worse—at least for employers—obesity racks up nearly $6.5 billion in absenteeism costs with an additional $30 billion in lost productivity, from those who still manage to show up. Not only that, but according to the Duke University study that broke these numbers, the less productive obese workers cost employers—on average—a month out of every year. And maybe least surprising of all, obese men rack up nearly six more sick days a year, while women tally up more than nine sick days annually.
This isn’t about how many of us are overweight, because we’ve all seen the numbers, with an upcoming HBO documentary reporting that 69 percent of us now weigh more than we should.
What this is about is getting hard numbers, with the obese (and particularly the morbidly obese) now costing the system far more than smokers.
Finally, and where it matters most to those of us in the business, Reuters reported that non-obese Americans pay higher health insurance premiums and taxes into Medicaid to pick up the tab for the obese.
The numbers, like the buffet lines, go on and on.