With so many things changing all at once in healthcare, it’s no surprise that the corporations that are the private employer-purchasers of U.S. healthcare want to keep their collective finger on the pulse of what’s been going on with health insurers and healthcare providers. Indeed, as much as hospital, medical group, and health plan leaders are plunging ahead to leverage data analytics to understand health system clinical and resource utilization performance, so, too, the corporate purchasers of healthcare are intent on figuring out just what is going on these days with healthcare delivery and payment.
It is in that context that the Washington, D.C.-based non-profit National Alliance of Healthcare Purchaser Coalitions (the National Alliance) recently conducted a survey—commissioned by Geneia LLC, the for-profit subsidiary of the Harrisburg, Pa.-based Capital Blue Cross and Blue Shield—to find out what healthcare purchasers are doing in that area. That poll found that 97 percent of human resources executives at corporations agree that “now more than ever, it’s essential to have tools to effectively evaluate data and make informed decisions.” Most respondents (87 percent) say they are familiar with advanced analytics, but current users have a stronger understanding of how this kind of tool helps aggregate data, control spending, and manage health and wellness programs.
In releasing the results of that survey on Oct. 12, Michael Thompson, president and CEO of the National Alliance, said in a statement that “Many employers struggle with massive amounts of data and lack the ability to quickly and easily make informed decisions that shape their benefits programs. And it’s only getting worse,” Thompson said in the statement, “as it’s estimated by 2020 we will have 50 times the amount of data that was available in 2011. Gauging the knowledge and interest level of employers enables the National Alliance and its members to make available programs and tools to help purchasers overcome this challenge.”
Among other key findings in the survey:
> Among survey respondents, 95 percent indicated that they’re interested in having access to the information that advanced analytics can provide.
> 90 percent of respondents said that near-real-time data is imperative to realizing costs savings
> 94 percent agree that “healthcare analytics can help me evaluate which wellness programs would be most effective to offer to my employees.”
> 83 percent agree that using advanced analytics to understand how your employees use healthcare services, who your high-risk employees are and how to intervene effectively is the only way to lower costs and improve financial results.
> When asked about what data and reports would be helpful, the top three responses were data on the number of employees regularly visiting the emergency department but who have not seen their primary care doctor in the last year; timely data on percentage of pre-diabetic employees who have not seen their primary care doctor in the last year; and an evaluation of their company’s healthcare spend against similarly sized companies in their industry or region
> Of respondents who were not currently using advanced analytics tools, the perceived barriers to use were cost (38 percent), insufficient internal resources (31 percent) and needs already supported by health plan or broker (54 percent).
The release of the survey’s results also included a statement by Heather Lavoie, Geneia’s chief strategy officer. “Healthcare costs are still growing faster than inflation and are expected to increase 6.5 percent through next year, leaving employers, health plans and consumers struggling to find ways to contain costs without sacrificing quality and benefit design,” Lavoie said. “At Geneia, we know that the insight gained through advanced analytic tools offers employers the very real possibility of lowering costs while retaining competitive employee benefit programs.”
The online survey of human resource and benefits administrators was conducted in August and September 2016. Of the responses received, 89 percent of employers said they were self-funded, 69 percent work for companies that employ more than 1,000 and 60 percent said they are not current users of advanced analytic tools. Regionally, 50 percent of respondents were from the South, 26 percent were from the Northeast, 15 percent were from the West and 9 percent were from the Midwest.
Following the release of the survey’s results, Michael Thompson and Heather Lavoie spoke with Healthcare Informatics Editor-in-Chief Mark Hagland. Below are, first, excerpts from the interview with Thompson, and second, excerpts from the interview with Lavoie.
Tell me about the National Alliance of Healthcare Purchaser Coalitions.
Michael Thompson: The National Alliance is a group of 50 business coalitions across the country, representing 41 million people, and about 12,000 employers; and about 450 of them are over 5,000 employees. It’s public and private employers, as well as Taft-Hartley organizations—when there’s a union plan managed by a trust of half-management and half-union.
Where are your members right now?
As much as the discussion is all about cost, I think that purchasers’ mindset really is around value. There’s been a lot of terrific innovation in the industry that actually has value, health, and outcomes, and they recognize that. I think where they have a lot less tolerance is when things cost more but don’t add any value or add little value relative to the cost. That’s where purchasers are looking to change the system, and in how they guide their employees.
What were the biggest takeaways for you from the survey results?
We always recognize that employers value data, to be fact-based in their decision-making, but what was particularly interesting from this survey was the universality of the importance in terms of making data actionable--in other words, its value in informing them on how they should modify their benefits, modify their plan designs, modify their benefits.
Purchasers want to get more active in pushing the levers of control around healthcare delivery and costs, correct?
I think that’s a fair point, yes. Historically, employers have been focused on which health plan performs better compared to the next; but of course, the variations don’t really occur with health plans, but rather with providers themselves. So increasingly, employers are pushing health plans to create greater transparency around provider outcomes, so that employers can direct their employees to higher-performing systems. That’s frankly still evolving. Some employers are doing that on a direct basis; others are finding intermediaries to steer things towards bora-based solutions or towards more specialized solutions, like centers of excellence.
What are your and your members’ perceptions of the accountable care organization phenomenon?
In general, we applaud any movement to shift the mindset of providers to align their systems and delivery of care with value. Frankly, the fact that they call themselves an accountable care organization may not mean that they’re high-performing at this point in time; and what we see is very much a maturity model as it relates to organizations and how they perform. Different employers will have different appetites to get involved with less mature entities. But if it’s a long journey, it’s good that providers have started down that path. And while Medicare has started to move in the direction of accountable care, it’s still early in the game, but as Medicare brings accountable care into the broader Medicare program, that’s going to be a major influence. So, the writing’s on the wall that this ship is turning, and employers are going to push as hard as possible to compel value in healthcare.
When you look at the new MACRA (Medicare Access and CHIP Reauthorization Act) law and the new Quality Payment system, do you see opportunity there for employer-purchasers?
Yes. My own view is that providers continue to struggle—the old model is fee-for-service, and it’s hard to transform towards being rewarded for value rather than volume. As the mainstream part of the market moves towards more value-driven programs, it will be incumbent on providers to change the way they practice medicine, to align. And it’s this transition that’s messy. I think organizations can succeed in either FFS or value-based, but it’s hard to succeed in both at once, still.
And the MIPS (Merit-based Incentive Payment System) program will require all physicians except pediatricians to do outcomes reporting. That will be an opportunity for purchasers, yes?
Yes, and it’s going to be incumbent to move towards more universal systems of outcomes reporting. And there are some differences among populations—Medicare, Medicaid, and commercial—but honestly, the more alignment we can achieve, the more likely we can make changes in the HC system.
What do you think will happen in the next few years?
The past decade has been the decade of the consumer, really, trying to get more information into the hands of consumers. I think the next decade will be more focused on the supply side—on how we get health plans, providers, and pharmaceutical companies to deliver more value. And data will be central to that discussion, and frankly, there will be much more focus on collectivism, rather than on everybody do their own thing. That’s why collaboratives are so helpful—they help purchasers to collectively support changes.
On a scale of 1 to 10, how optimistic are you about the transformation of the U.S. healthcare system?
Oh, I think I’m a 7. There are a lot of good things happening now; still, we can’t release our foot on pedal.
Is it your sense that employers are still early in their journey around advanced health plan design?
Heather Lavoie: I think that they have an understanding of health plan design—but as it gets more granular than that—the extent to which wellness programs are demonstrating a return on investment, for example, or elements like site of service or centers of excellence—what elements they can move to improve quality and cost—their HR departments have bene very small traditionally, and they’ve heavily relied on the brokers per the plans. They’ve had reports, but usually they’re retrospective, and they’ve felt powerless to have an impact. And we’ve been seeing some latency in the adoption of tools, so some have certainly gone out and used tools, but the uptake has been rather slow, because they don’t have the internal manpower to handle the administration of this. There’s been some concern about the numbers being small, and about access. But we’ve seen overwhelming interest in having access, but wanting to do this on an aggregated basis—employers see the benefit of pooling resources to have access to tools, and to inform strong practic3 in implementation—what programs will be most effective, and looking at benchmarks—on their own, they just don’t have the access to get the results.
Where are purchasers on population health right now, per plans and providers?
We asked them to rate how useful different types of access would help, on a scale of 1-7. Some of the most useful were data on the number of employees regularly using EDs but hadn’t seen their physicians in 12 months; timely data on employees who are pre-diabetic, but haven’t seen their PCP in 12 months; and the percentage of employees engaged in population health programs. And 5.5 was the rating for the same population health data, for seeing the same data that physicians and health plans are seeing on patients, that they see that that data is important for them to see as well. So they feel they need to see that data, too, to help effect change on our end.
Where will the emerging policy, payment, and demographic trends take us in terms of population health and analytics?
There’s going to be a demand for the sharing of data across all entities, so everyone’s aligned in their goals. Employers are seeing that they’re going to have to take a very firm position on costs and quality; the most aggressive are doing direct contracting with providers; others are pushing very hard on the plans for quality and cost results. They were pushing on the benefit design string for so long, and now employees can’t afford any more cost-sharing, and so the only place to go is the engagement of patients in care management and in the delivery of services, changing the site of care, such as urgent care versus ER, and so on. Every year, Willis Towers Watson (which brought together the firms of Willis Carroon and Towers Watson, into one firm), takes a look at the best-performing companies in terms of health care costs, and at the drivers of those kinds of performance. Last year, they were able to take claims data and quantify the net impact of the different best practices. And the best performers used clinical-level medical claims data to inform their program design; they had a 60-percent lead over the national average. And the best performers in 2015 paid $2,000 less per employee than other companies and were able to maintain a cost trend that was 2.6 percent lower across a two-year cost trend.
How do you see employers looking at the ACO phenomenon in this context?
It depends on the sophistication of the particular employer. But the most pioneering employers are a very educated group, and are advocating more for risk-based contracting and for the shift from volume to value. Being on the receiving end, they’re baking it into their requests for proposal, asking for documentation of effectiveness, and looking at a range of possibilities, from shared savings to full risk. So they’re very aware, and are certainly advocating it.
What should the CIOs and CMIOs of provider organizations take from this discussion?
I think they need to recognize employers as a critical, direct constituency now, and that employers really want transparency for the cost and quality of healthcare, and they really have a strong in understanding how healthcare is delivered. And that dialogue hadn’t traditionally occurred; they mostly worked through the plans, but employers are really wanting to get much more involved, not just through direct contracting, but through solutioning. They have day-to-day contact with the employees who are the patients. And that alignment can provide a lot of potential, if leveraged properly.