Between a new president and a new year — as well as all that Affordable Care Act repeal chatter — employers have a lot to consider when it comes to their health and benefits strategy in 2017.
Employee Benefit News spoke to Brian Marcotte, president and CEO at National Business Group on Health, and Mike Thompson, president and CEO of the National Alliance of Healthcare Purchaser Coalitions, about preparing for Affordable Care Act changes, employer hopes for a Trump presidency and other big trends to watch in the coming year.
What follows is an edited version of the discussion.
Employee Benefit News: We have a new president and a new HHS secretary who are promising to dismantle the previous administration’s signature healthcare law. What are you expecting?
Marcotte: By selecting [HHS Secretary Tom] Price, Trump is signaling that he’s really serious about dismantling the ACA and replacing it with a plan that relies more on increased competition among insurers than on government health insurance exchanges. It also likely means that Medicare payment reforms will get a second look — may advance a little more slowly. And I think that concerns us a little. We would hope that HHS would continue to transform Medicare away from fee-for-service, which drives unnecessary care and spending toward paying for value, and we’d like to keep our foot on the gas when it comes to transforming the delivery system and not lose momentum there. That’s the one bit of uncertainty… I think the first part of the ACA to go is the Cadillac tax. I also think the employer and individual mandates would also be on the docket, as well as the federal subsidies.
Thompson: Tom Price’s bias is very strong against federal regulation and federal oversight; he’s very state-oriented. [Changing federal oversight] can cause questions about how their healthcare is regulated, how their benefit plans might be influenced and how the dismantling of ACA plays into this. It could get replaced with 50 different versions of ACA, and that would be a concern.
EBN: Should employers start to think about the repeal of the Affordable Care Act as a real possibility?
Thompson: We will see changes to the ACA, there’s no doubt. If anything, we might see ACA repealed with some sort of forward-looking timeframe so they have time to replace it with something. Trump has made a point that he won’t leave people in the lurch in the meantime; frankly, having a time-limited chance to put something in place is an opportunity to take a thoughtful relook at how we do it. Many of us are hoping that a thoughtful look at healthcare costs would be the best thing to do.
Marcotte: If this is just a refocus on access — which is what the ACA primarily was — if it’s not going to delivery system transformation and value-based care, that’s a concern. But every early indication is it will focus on repealing those elements of the ACA that they don’t like, which include the employer and individual mandates and the federal subsidies. To repeal ACA and replace it, when we’ve got 20 million people covered by public exchanges or Medicaid expansion with federal subsidies in the mix, it would have to be a reasonable transition period to make that happen.
EBN: Is there anything employers should be doing right now to prepare for these changes, or should they take a wait-and-see approach?
Marcotte: It’s wait-and-see because, until you see the devil in the details, it’s really hard to react to anything other than the high-level banter about replacing and repealing.
Thompson: Wait-and-see is in order. Even if President Trump and Tom Price have a clear vision on where they want to go, there are a lot of key stakeholders that are going to weigh in over the next few years. And even things there appear to be concessions on — including delivery and payment reform —may resurface as more stakeholders weigh in and it becomes clear that we’re not going to solve the fundamental issues unless we are willing to tackle that issue.
EBN: In general, what do you think is the potential impact of a Trump presidency on healthcare? How are the employers you talk to reacting to this?
Thompson: I would like to think [Trump’s] heart is in the right place — he wants to put consumers and patients first; he knows there is a problem with healthcare costs. I think having a fresh look at these things could be helpful. What’s concerning is if it doesn’t get beyond over-simplified solutions to very, very complex problems. The more that he can enable thoughtful policymaking and break the logjam of some of these issues that have been around for decades, the better.
Marcotte: It will be interesting to see what Tom Price does and how he approaches, particularly, Medicare and Medicaid. Are we going to push states to manage their own Medicaid expansion or figure out how to cover the uninsured? To Mike’s point earlier, he’s not a big government guy, so he’s going to push as much as possible to the states, so what does that mean; what does that look like? What elements of ACA will be preserved?
EBN: What are the major trends you saw in 2016, and now going into 2017?
Marcotte: Specialty pharmacy. It’s jumped over the last couple years to be the No. 1 cost driver for employers, even though it only impacts about 2% of their population, which really gives you an indication of the challenge of specialty pharmacy. Another trend we saw developing was employee engagement—across wellness, transparency tools—is the No. 1 challenge for employers. They are trying to figure out how to drive engagement, keep programs and resources in front of people so they take advantage of it.
Thompson: 2016 was a turning point. For the last decade we have been trying to figure out how to get consumers engaged in their own healthcare. But for many employers, I think the conclusion was they’ve hit a wall, and in many instances, they are getting some backlash for strategies they tried, like high-deductible health plans. Many [employees] don’t feel empowered or enabled to make those decisions because they don’t have the information or they don’t have the health literacy to act thoughtfully on their own behalf. So I think we’re shifting to more of an advocacy-oriented model for employees, combined with more focus on the supply side: on what’s being delivered through our delivery system and the rampant diversity both in the quality of care and the value of care being delivered.
EBN: You both mentioned engagement being a big theme. What do you think employers have to do to finally get through to employees and drive engagement?
Marcotte: I think the fundamental engagement challenge employers have had is: How do I keep programs in front of people at the time they need them? But with the emergence of data predictive analytics and the ability to personalize communications and reach people at the time of need, there’s promise I can catch the same person and push communications based on their claim history or pharmacy data, and give them information about available programs and maximize what employers are offering employers. This is an emerging capability that will get better with time.
I think there’s an opportunity to leverage technology, data and personalization at the time that they need it.
Thompson: The issue of engagement is overwhelming. The problem is that employers’ health plans have so many different capabilities to support people in managing their health and how they get their healthcare—yet there is so much challenge in getting them the right information at the right time. But employers are starting to think more in terms of consumer hubs — finding a captain to the team around all the various ways employers can potentially — using consumer hubs to engage employees on their terms -- learn what’s going on in their lives and then use that to guide them to the types of support that’s available to them. I think that approach is gaining traction.
EBN: Anything else to keep in mind?
Marcotte: Employees will never be sophisticated consumers of healthcare. We want them to be, but we’ve come to the realization they won’t. The system is too complex and they don’t touch the system enough for them to become a sophisticated consumer in other areas they are, like retail. Another way to address it is to put in navigators and concierge services to help employees navigate through both in terms of what their benefits are and what resources are available to make decisions about care and where the best places are to get their care.
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