The case for innovative health plans

November 21, 2023

This article was originally published in the ChartHop newsletter.

The US healthcare industry is failing in its one job – ensuring your people have coverage for the most routine care needs.

• Many employees fear mountainous debt, even from just one doctor visit or medical test.
• This is despite the fact that healthcare spending is likely your top expense as a company outside of payroll, and you are facing the steepest increase in employer healthcare costs since 2012.

Why it matters: Many people leaders – especially generalists at smaller companies – focus their energy on innovative employee experience initiatives (i.e., performance management). But avoiding proper time investment in complex and tricky things like compliance and benefits does a disservice to employees.

• Reactive approaches to escalating healthcare costs won’t do anything to change a system that’s stifling company growth and emptying employees’ wallets.

HR leaders, CFOs, and benefits teams may feel powerless when renewal season comes around, but these days it’s becoming easier to reject the status quo.

• Saying yes to innovative health plan designs that encourage the right care, not less care, can dramatically reduce healthcare costs while improving access and quality for covered workers.
• All it takes is the willingness to commit to the process.

Taking the reins: Bucking a broken system to offer a health plan employees can actually afford to use is not as hard as it may seem. Here are just a few of the possibilities your company can explore:

• Think no deductibles, vetted providers, and true care coordination that happens with a strong, supported PCP relationship.
• Offer a massively simplified health plan that your employees understand so they aren’t afraid to put it to use. (Even this panel of Jeopardy contestants couldn’t accurately define basic health plan terms.)
• Consider a self- or level-funding arrangement, which gives companies more control and insight into what’s driving costs.
• Find a plan that incentivizes what matters most to a healthier workforce (preventive care, access to high-quality providers).
• Be choosy about pharmacy benefit managers (PBMs): look for transparent, reasonable pricing.

The bottom line: The benefits choices your company makes can not only free up employees’ budgets for rent, gas, and food while affording them excellent care, but can also start to turn the tide of the entire healthcare industry.

Go deeper: Employers hold the key to unlocking healthcare affordability