If you’re a business owner you probably have concerns about the increasing cost of healthcare and specifically what you can do to help lower your costs of providing quality health benefits to your employees. Well, you’re not alone.
In a recent survey of 133 U.S. employers, they collectively said they expect health plan premiums to rise by as much as 5 percent in 2017. As a result, many are taking steps to implement a few changes that may help to offset those increases.
Here are the top three factors expected to drive up the cost of health care and what some employers are doing to combat them.
Specialty Drug Costs
With an anticipated increase of 7.3 percent in 2017, prescription drugs will be a huge driver in the increasing cost of providing employee benefits. One key reason is the emergence of a number of expensive specialty drugs, a category expected to increase by 16.8 percent.
In order to control the costs of medications in general, many are implementing step therapy (starting with the lowest cost drug option before trying more expensive alternatives), requiring prior authorization for prescription refills, or using quantity limits.
Another tip is to require that specialty medications be purchased from specialty pharmacies, those who only carry those types of drugs. Not only does this help to control costs, it also connects workers with providers that specialize in their condition and can help them better manage it.
Another way to control costs is by addressing high-cost claimants, those who cost $50,000 or more in a year (though the average for a high-cost claimant is actually $122,382, which is 29.3 times that of the average enrollee). Although these individuals make up only 1.2 percent of all members, they account for almost a third of healthcare spending.
A great way of combatting this issue is by offering consumer-driven health plans (CDHP) and health savings accounts (HSA), which makes employees responsible for more of the initial costs for their healthcare. Since they’ll pay lower monthly premiums, they can better prepare for up-front costs by saving tax-free money in their HSA.
Money saved in an HSA goes with employees even if they change jobs, and employers can even contribute to them. Thirty-five percent of employers surveyed say they will only offer these types of plans in 2016.
Diseases and Conditions
Another factor leading to high-cost healthcare claims is high-cost conditions. In fact, among the costs for high-cost claimants, 53 percent went to cover chronic conditions vs. 47 percent for acute conditions. While there’s less that can be done about the latter, many employers are doing what they can to address the former.
Of those surveyed, 80 percent planned to offer access to a nurse coach who can help with care and condition management or even general lifestyle management (72 percent). These programs can help employees with everything from ensuring they’re taking their medications properly to educating them on what a balanced diet looks like to designing an exercise regimen to help with their condition.
Another similar option is telehealth, which allows employees to communicate with a healthcare provider without even having to go to a doctor’s office. These are especially beneficial for treating mental health conditions like depression. Ninety percent of employers plan to make this service available in 2017, up from 70 percent this year and 46 percent last year.
These and other changes are not only useful for lowering your overall healthcare costs, they can also greatly improve the health and wellbeing of your employees. When you’re employees are healthier, they’re happier, and–at the end of the day–so are you.