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Sponsored by: Mercer
February 8, 2021

Reinventing Healthcare in a Post-COVID World

2020 in a word: tumultuous. There are, of course, other non- PG-rated descriptors that come to mind, but to describe the events of the last year as anything other than the disruptive and volatile swirl the word conveys would be inadequate. As a society, we were tested by the strains of a global pandemic, pained by sickness and loss, and forced to hold mirror to a national face much less inspirational than we led ourselves to believe - one scarred by racial injustice, inequity and division. It was a season of reckoning. And for employers, healthcare providers and patients alike, it was a season of survival, as the need to reinvent how we access care accelerated the adoption of digital solutions that will likely forever change the way consumers interact with the healthcare system.

Entering 2021, employers continue to face not only financial pressures, but employee demands to embody a culture they are proud to represent; no longer in the shadows, they are making their voices heard, and employers – to their credit – are listening. This has led to a season of reinvention, and those employers in the lead are capitalizing on three things: value, flexibility and equity.

Reinvent for Value

Mercer’s 2020 National Survey of Employer-Sponsored Health Plans reports slower cost increases of 1.9% for employers of 5,000 or more and 6.9% cost growth for small and midsized organizations –a testament to the significant cost burden being borne by midsized employers. While there is some noise in these numbers with MLR rebates still to be paid in 2021, it remains concerning. As employers contemplate how to gain their footing in a COVID economy and plan for a post-COVID recovery, it only makes sense to reevaluate the considerable expense associated with providing health benefits to employees. Using their leverage to ensure that dollars are spent in the right way, for appropriate care in the most effective setting and at the right time, has shown to not only reduce costs and improve outcomes, but improve the employee experience overall. The exploration of narrow, high-performing networks, Accountable Care Organization (ACO) expansion, and targeted direct contracting where appropriate continues to gain momentum. At Mercer, we are closely working with clients to measure the value of their provider networks through cost, quality and outcome data analysis. Together, we believe employers can reinvent for value by driving higher quality at a lower cost.

Reinvent for Flexibility

Even pre-pandemic, there was growing demand for a bespoke healthcare offering, akin to an AI- driven online shopping experience. Paired with the challenges of obtaining brick-and-mortar care during lockdown and cancellation of many non-essential procedures, healthcare consumers turned to telehealth services in historic numbers. According to the Mercer survey, in 2019, just 9% of eligible employees or family members used their telemedicine service at least once. But in just the first six months of 2020, utilization had already reached 14% -- and by the end of the year it climbed much higher.

As employers begin to plan for a larger role for virtual care in their programs, they’ll need to think about how to incentivize employees to use the right modality for the service they need – AI, telemedicine, a virtual visit with their own provider, or an in-person visit – and get the pricing right for the different levels of care. Like any other type of provider, not all are equal, and the value conversation remains critical. The pandemic has also increased rates of anxiety, depression, and substance misuse disorders; in response, employers are also prioritizing behavioral health services as they make strategic enhancements to their benefit programs. Nearly 20% of midsized and small employers and nearly 30% of large employers are looking enhance their offering to provide greater access to behavioral health programs for their employees, and the majority of Mercer clients are enhancing their employee communications to reduce the stigma associated with the struggle.

Reinvent for Equity

CDC data shows that COVID has highlighted a significant disparity in US healthcare, where among those aged 45-54, for example, Black and Hispanic/Latino death rates are at least six times higher than for whites; The National Diabetes Statistics Report released by the Centers for Disease Control and Prevention (CDC) in 2020 revealed stark racial disparities in the prevalence and incidence of diabetes across the United States; and surveys such as the US National Health and Nutrition Examination Survey (NHANES) have highlighted disparity in hypertension prevalence, with Non-Hispanic blacks (NHB) having significantly higher rates of hypertension compared to non-Hispanic whites (NHW).

As it relates to employer- sponsored healthcare, the notion that one-size-fits all benefit plans fit all employees has proven itself false, and as a call to action, employers have begun to collect and look closely at data through the lens of race to identify utilization patterns, communicate more effectively, and address barriers to care. Inclusive benefit options for gender reassignment and non-traditional family planning are gaining traction within certain industries, while financial wellness programs and expanded voluntary benefits offerings continue to be embraced broadly.

The events of 2020 served as not only a reckoning for all Americans around injustice and inequity in our communities, but an accelerant for the digital transformation of healthcare that was slowly taking shape. But as we’ve seen with the recent dissolution of the Amazon/JP Morgan/Berkshire Hathaway venture, Haven, transforming healthcare isn’t as easy as it seems; as the largest payors in the healthcare ecosystem, we believe that employers are uniquely positioned to drive change.

 

Tricia Rivera,
CT Health Practice Leader,
Mercer