Rhonda Marcucci, founder of Gruppo Marcucci (GPM), is a respected industry, observer, speaker and author of articles on topics pertaining to the HR and Benefits Administration technology and outsourcing industry. For up-to-the-minute insights from industry conferences, follow Rhonda on Twitter.
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Posted on 01/31/2014
Lots of energy and excitement around the redesigned strategies and the future of healthcare! That was the major take-away from the January conference in Arizona on Consumer-driven Healthcare and the Private Marketplace, sponsored by Healthcare Education Associates, which featured a lineup of sessions focused on private exchanges and the consumer experience, two of today’s hottest healthcare topics. Gruppo Marcucci was there to hear what the various industry stakeholders had to say and we’re pleased to share our observations and insights here.
ACA is here to stay in spite of election referendums, constitutional challenges, and a disastrous rollout. Public exchanges are good for the private exchange market as it will help consumers adjust to annual enrollments, choice and decision support tools. Hindsight being 20/20, there’s lots of comparisons to Medicare Part D—a real success story in spite of initial resistance and roll-out issues.
Conference buzz was that employers are moving to a fully-insured model; away from self-funding, choosing the true “defined contribution” and passing on more risk to the carriers. In response, carriers are working harder to contain costs, including by negotiating tighter networks. This is counter to what we’re hearing at Gruppo Marucci, where we see a growing interest in self-funding. Regardless, the fact that everyone is taking cost containment seriously is good, but demographics don’t favor long-term cost reduction. Self-funded employers will bear the brunt of cost shifting as fully-insured is negotiated more aggressively.
Employer attitudes are changing when it comes to healthcare and moving in one of two directions: disengage or double-down. Those who disengage are limiting liability through defined contribution and may eventually replace benefits with salary increases. Doing so may have questionable consequences unless Congress changes pre-tax rules. Those who double-down are developing healthcare expertise and directly contracting with providers and ACOs.
Leading edge employers are coming full circle. Employers who sold employees on high deductible plans and are now moving to exchanges need to re-educate employees that other choices (including low deductible plans) are right for some. Good education and support tools are a must!
Can there be too much choice? While employees report that choice of plans is what they most value, one employer found 20 plans was too much choice. Based on feedback they reduced the plan options to 16 which elicited a positive response. (Perhaps it was more that the employer listened and was responsive to feedback that made employees happy.) There is no science as to the exact right number of choices to offer.
Transparency of marketplaces (and ease of use) threatens transactional brokers who no longer need to transact within a given exchange because the exchange is doing it for them. These brokers can expand their role as a trusted advisor in the process of choosing among multiple exchange options as well as other benefit programs.
Consumers don’t care about their health plan; they care about their doctor/network. Stakeholders need to think about what motivates the consumer decision. Remember, the majority of employees choose different benefits with an exchange.
Choice is not enough. Exchanges must provide ongoing value—positive experiences to bring consumers back throughout the year. Wellness tools, concierge support, doctor recommendations, cost comparisons are examples. Mobile apps are important as, increasingly, we all have access.
No consensus on government action on pre-tax. Industry stakeholders attending the conference were at both ends of the spectrum on whether Congress will come up with a way for employers to provide pre-tax support for individual plans. We’ll have to wait this one out.
Gruppo Marcucci is available ;to explore any of these points in more detail with you. Let us know if we can assist you with any of your HR benefits and administration technology and outsourcing. We work with all industry stakeholders–from brokers and employers, to carriers, investors and service providers; giving us the full spectrum of perspectives and insights. Our expertise includes private exchanges, tools to choose/use health plans, wellness, ACA support tools, Benefit Administration, HR/payroll technology, spending accounts, COBRA and more. Email Rhonda at Rhonda@gruppomarcucci-usa.com or call 312.789.5267.
Gruppo Marcucci (GPM), a division of Gallagher Benefit Services, Inc., provides outsourcing intelligence and associated consulting to stakeholders in the Benefits and HR Technology & Outsourcing industry. Our in-depth understanding of the service provider market and our vast experience sourcing and implementing solutions is key to our clients achieving full operational success.
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