insurance – Group Benefit Solutions

Many Workers Struggle with Medical Bills, Despite Having Insurance

Chris Wolpert — Tue, 22 Oct 2019 18:38:59 +0000

A new survey has found that many American workers are struggling with medical bills even though they have employer-sponsored health plans. The good news from the survey was that 81% of respondents said they had health insurance, which meant they were 19% more financially fit than people without insurance. They were also happier. The survey found that:

One in 10 employees who have insurance and pay part of the premiums, also have annual out-of-pocket medical bills of more than $10,000.
33% of insured employees carry medical debts that they are trying pay down.
Insured employees that carry medical debt are 42% less financially fit than those who do not have such debt.

Carrying debts related to medical care also affects employees’ health. The survey found that workers with money problems are:

Three times more likely to suffer from anxiety and panic attacks.
Eight times more likely to have sleep problems.
Four times more likely to suffer from depression and have suicidal thoughts.

Stress from medical debts can also affect worker productivity. Of employees with medical debt problems:

24% have troubled relationships with co-workers.
22% cannot finish their daily tasks.

Lost productivity from these two issues costs businesses up to 14% of payroll expenses, the survey found.

What can you do

Given that health care costs show no signs of abating, what can you do for your low-wage employees and also ensure that your own health insurance premiums don’t spiral out of control? Here are some options: Vary premium level – If you have a mix of highly paid staff and lower-wage workers, you can create a tiered system where the latter receive greater premium contributions from you than do the former. About a quarter of large employers vary employee health insurance premiums. This is something that’s not feasible for all businesses, particularly if money is tight. Offer plans with generous benefits – You can offer a slate of plans, from ones with larger copays and deductibles to those with low or no out-of-pocket costs for those employees willing to pay more in premium. This way, your low-wage workers have a choice of health plans which include lower deductibles and lower variability in potential out-of-pocket liability. Offer skinny plans – Skinny plans still cover the 10 benefits required by the Affordable Care Act, but they typically have a narrow network of providers in exchange for low out-of-pocket costs for the enrollee. While this option is good for your younger and healthier worker, it is often a non-starter for those who have existing health issues. Carefully review incentives and subsidies – Employers should design wellness incentives that do not penalize low-wage workers, who are more likely to smoke, (many employers impose a tobacco surcharge averaging $600 a year). Employers should couple tobacco surcharges with tobacco-cessation programs, and waive surcharges for employees who are trying to quit. Offer plans with modern attributes – Telemedicine services can reduce health care costs, as they reduce the worker’s need to take time off for an appointment and also lower the cost of delivery of care. Push for lower prices and costs – You should coordinate with us, so we can work with your health plans and providers to reduce costs.

How Employers Can Fight the High Cost of Diabetes

Chris Wolpert — Mon, 26 Aug 2019 17:57:55 +0000

Diabetes is a devastating illness – and not just for those with the disease. Employers are also shouldering massive and increasing direct and indirect costs due to diabetes.

Diabetes afflicts more than 11% of the adult population, including about 6.3% of full-time workers and 9.1% of part-time workers.

Adults with diabetes incur more than $8,480 in direct treatment costs, on average. Those who are insured spend even more.

A 2016 report from the Health Care Cost Institute estimated that insured workers with diabetes spend more than $16,000 on health care costs per year. Those without diabetes, on average, generate about $4,396 in medical costs per annum.

Indirect costs

Employers aren’t just paying more in direct health care costs and insurance premiums. They also pay via lost productivity.

On average, those with diabetes miss an extra week of work – 5.5 days – compared to other workers, according to Gallup estimates. All told, that adds up to 45 million missed workdays and productivity costs to U.S. employers of $4 billion.

And for employers, these costs may represent just the tip of the iceberg. The Centers for Disease Control (CDC) estimates that more than 114 million adults in the U.S. – a third of the workforce – have undiagnosed diabetes or prediabetes.

What can employers do?

The CDC recommends that employers design wellness programs that specifically target improvements in the following areas:

Exercise and activity levels
Smoking
Hypertension
Blood cholesterol
High blood glucose
Weight/obesity

There also are a number of measures employers can take to help mitigate some of the costs to the organization.

Offer ongoing counseling with professional dieticians. Employees that regularly meet with dieticians who can help them set small, manageable goals for themselves, make significant and measurable health improvements, according to a 2016 study. The research found that they lost 5.5% of their body weight and reduced blood glucose levels.
Start a walking club. The American Diabetes Association’s Stop Diabetes @ Work program recommends that employers encourage company walking clubs to attend diabetes walk-a-thons like Step Out: Walk to Cure Diabetes, or host a Community Walk to Cure Diabetes.
You can find resources, including posters, newsletter articles, training plans, and walking guides, at diabetes.org.
Encourage self-assessment and screening. According to the CDC, 30% of people with diabetes aren’t even aware of it. Workplace screenings are easy and effective. Many employers provide incentives for workers to participate via reduced insurance copays or even cash payments. All screenings should be confidential and employers should not penalize employees who have diabetes, as this could violate the Americans with Disabilities Act.

Encourage smokers to quit. Diabetics who smoke have far higher medical costs on average than non-smoking diabetics or non-diabetic smokers. Discouraging tobacco use can pay off in the long run.

With so much at stake, a robust workplace program to fight diabetes can generate a significant return on investment.

The American Diabetes Association estimates that preventing or delaying the onset of diabetes in just one prediabetic employee can generate more than $50,000 in direct and indirect cost savings over five years.

Employers Say Pharmacy Benefit Manager Contracts too Complex, Opaque

Chris Wolpert — Wed, 06 Mar 2019 07:35:52 +0000

Three in five employers think their contracts with pharmacy benefit managers are overly complex and not transparent, according to a new study.

The study, which found that employers would prefer that PBMs are more transparent with their pricing and would like them to focus less on rebates and value-based designs, comes as PBMs are under increased scrutiny for their opaque pricing practices.

The survey of 88 very large employers, “Toward Better Value: Employer Perspectives on What’s Wrong with the Management of Prescription Drug Benefits and How to Fix It,” was conducted by Benfield and commission by the National Pharmaceutical Council.

The findings drive home some of the common complaints about PBMs:

Poor transparency – Employers said that current pharmacy benefit management models lack transparency:

30% said they understand the details of their PBM contracts.
40% said they fully understand their PBMs’ performance guarantees.
63% said PBMs are not transparent about how they make money.

Complex contracts – Nearly three in five employers surveyed said PBM contracts are overly complicated, ambiguously worded, and often benefit the PBM at the expense of the employer. Tops on employer’s wish list: clearer definitions and simpler contracts.

Focusing less on rebates – Seventy percent of employers said they thought PBMs should offer other ways besides rebates to reduce prices.

Employers also said rebates detract their attention from more important factors, like reducing employee coinsurance or deductibles or getting better access to the most effective pharmaceuticals.

Two suggestions they had: Discounts or point-of-sale rebates, in which patient payments reflect a post-rebate price.

Getting value for employees – Employers want to understand the thought process when PBMs create formularies and exclusionary list decisions, such as the clinical, financial and economic impacts.

Employers had these suggestions:

Using value-based insurance design, where high-value drugs cost patients less than low-value drugs.
Setting payments based on the effectiveness of a drug.