What does alignment mean for health benefits?

For several years, “alignment” has been headlined as the key to fixing our broken healthcare experience, transforming the outcomes and economics of benefits programs. Self-insured employers have been directed to view alignment — among all parties in the delivery and receipt of care — like a Rosetta Stone that will translate chaos into order. And we all understand what alignment means — or do we? As a physician, executive and consultant, I’ve been working with employers for 25 years on their healthcare needs. I know that employers want to improve the value they receive for the considerable spend they invest in their people.

Read more: JPMorgan launches new venture to again grapple with healthcare

But more and more “alignment,”” or “aligned incentives,” has been corrupted as a buzzy marketing term, one that’s unrolled in sales pitches like a blanket to bundle everything from the legitimate — clinical outcomes — to the self-interested — closed networks. It’s time for a course correction. Let’s go back to where we started, understanding the value of alignment for setting a truer direction. When your car is unaligned, you understand — and you feel — how the imbalance of even one wheel adversely affects the whole vehicle and makes your journey tricker. Can we apply alignment that way for healthcare — as was originally intended — where individual benefit is driven by the balance of the whole? We’re facing an imminent bump in healthcare demand, when members seek care that was put on hold during COVID. Alignment will be pivotal to righting the wheels through this journey to better health. Employers have an outsized power to change how the industry thinks about and acts in alignment — ultimately, delivering value for improved outcomes. But to get there, we need to first understand what alignment means.

Equal parts balance the whole
Better healthcare must function as trinities of equally-weighted angles — quality, accessibility, affordability — and equally-weighted stakeholders — employers, members, and providers. Ideally, with these criteria as the foundation, employers can more objectively audit their array of health and care programs, select “high-value” partners, and rethink how they’ll measure success a year from now, steering clear from the current wreck of point-solution overload and competing interests.

Employers understand that good health is good for the company, and leads to increased productivity, reduced absenteeism, turnover, and lower costs. Employees understand that good health is good for their well-being and that of their families. Providers understand that good outcomes are why they went into medicine and are good for their practice. There is alignment in their implicit understanding of the value of better outcomes. So, how do we bring it to the forefront? Changing the fundamental question from “What is the cost?” to “What is the value?” should be the defining principle of every conversation with a benefits leader about alignment.

Read more: Addressing racial disparities in healthcare benefits

Too often in these internal calculations, cost becomes the driver. On the surface, I can understand why misaligned incentives happen. Cost would seem to allow the simplest measurement of improvement — of “value”— but cost by itself is highly limited and exclusive of the other parts that make up the whole. That type of singling out is actually the opposite of alignment and is the tempting mistake that takes us down the wrong path. Value is a more complete measure and can be quantified in a way that touches the entire ecosystem. Think of value as having a variable numerator — quality (objective and subjective outcomes), appropriateness of care, and member experience — and a denominator — cost. Quality and experience are factored against cost to form the essential benchmark for placing the member’s health at the core of benefits planning. Fixed cost, in the form of at-risk value-based care, allows for the surest degree of "value planning," aligning quality and cost with greater confidence, but I'll leave that topic for a deeper dive.

How to get to alignment
Understanding alignment in the context of value opens the door to clarifying what really matters most — and what doesn’t — in building a better health experience:

• providing members with objective, unbiased information that enables them to make better choices;
• helping members identify an informed range of appropriate choices and helping them determine their right next steps, from medical care to personal wellness to mental health support to a specific app;
• facilitating easy access to care from high quality, high value providers by asking the right questions about the whole person and together deciding appropriate care plans;
• giving members the unbiased information to make overall value choices;
• and, ultimately, aligning financial incentives and clinical outcomes among providers and vendors.

For real healthcare reform, total value will be determined by improved outcomes that benefit both the member and the employer. Alignment, where cost is not privileged at the expense of quality and overall value, can be the key we’ve hoped for, the elegant solution that finally builds the clean model employers have wanted. As smooth and true as a fine set of wheels.