Looking Toward the Horizon: Top 7 Health Care Trends for Employers in 2022
January 6th, 2022
At the recent PBGH year-end roundtable, noted health care futurist Ian Morrison discussed key health care trends that both he and PBGH believe will be most relevant to purchasers in the year ahead. Morrison is the author of several books on health care and has worked with more than 100 Fortune 500 companies in health care, manufacturing, information technology and financial services.
Here, the top 7 trends for large health care purchasers to watch as we head into 2022.
1. The workforce will remain in upheaval
Providers and other employers continue to grapple with the unfolding impact of the Great Resignation. Difficulty recruiting and retaining staff will remain an ongoing problem for many provider organizations. One consequence will be the continued ascendance of telehealth and other virtual care services. Separately, the loss of employer-based insurance for many workers who’ve left their jobs will likely increase self-pay, health exchange and Medicaid patients, resulting in a worsening payer mix and continued financial pressure on providers.
2. Providers depend on employers for profits
According to a recent RAND study, hospitals charge employers, on average, about 250% of Medicare rates. The premium over Medicare can range for 130% in Iowa to 300% in California. The reality is that providers are dependent on self-insured and commercial payers for their entire margin; purchasers that can’t or won’t consider shifting provider networks to compel some level of competition will continue to be subjected to the highest charges.
3. Choice has been conflated with quality
Employers are beginning to understand that in opting for broad, open provider networks over the years, they’ve undermined their own ability to direct employees and members to the highest-quality, most efficient provider organizations. This recognition is supported by surveys that show consumers themselves are willing to trade choice for quality.
That’s why, increasingly, large employers/purchasers are measuring and contracting with teams and individuals that meet their standards for quality and service and respond to their concerns, stepping away from one-size-fits-all arrangements with large health systems. PBGH members, for example, report quantified success through direct purchasing relationships with systems that are eager to innovate and demonstrate quality. Passively accepting health plan reports is a thing of the past as employers gain the experience and data needed to scale new approaches.
4. Consolidation will continue
Mergers and acquisitions across all levels of health care will continue as organizations negatively impacted by the pandemic are picked up by those interested in broadening their footprint or extending vertical integration. This trend will increase the market share of the most powerful health systems and reduce potentially more cost-effective alternatives for purchasers.
5. Investment in digital point solutions will keep growing
Venture capital investment in digital health solutions has doubled over the past several years to approximately $14.7 billion this year, and the trend is expected to continue. Fundamental questions remain about whether these solutions are truly adding value or simply increasing fragmentation and cost across the system. Employers are overwhelmed by the sales pitches they receive from new companies vying for their business and are looking for trusted sources that use clinical rigor and data-based outcomes to help them assess their value and create needed standards in the market for new entrants.
6. Addressing the health care inequities exposed by the pandemic will become a priority for providers and purchasers alike
The risks of hospitalization and death for marginalized people in the U.S. are two-to-three times higher than for white people. Organizations will continue looking for opportunities to close this gap by improving access and finding innovative ways to address social determinants of health. Such efforts can include innovative maternity care that reduces disparities and improves quality and outcomes and the broad adoption of patient-reported outcomes, which offer an ideal means for gaining insight into the care process and how its experienced by patients.
7. Employers have an historic opportunity to impose greater control over the health care supply chain
Because the pandemic has caused significant upheaval across the health care system and created financial stress for many provider organizations, purchasers have an unprecedented opening to leverage their buying power in pursuit of higher-quality, lower-cost care. However, they can have an impact only if they’re willing to act in concert. Alignment on priorities and implementation is critical to advancing the change we need. Purchasers must become more aggressive in designing benefits that favor high-value delivery partners.
Opportunities in COVID-19 Vaccine Access and Equity
May 4th, 2021
While COVID-19 vaccine eligibility has expanded and supply has increased, data show that access to vaccines are not equitable throughout California’s communities.
Health care leaders are looking to work together differently as their vaccination efforts shift from trying to meet demand through mass vaccination sites to targeted interventions that address the needs and concerns of high-risk communities and vaccine-hesitant individuals.
In late April, PBGH’s California Quality Collaborative (CQC) hosted a closed roundtable discussion for health plans, provider groups and California state agency representatives to discuss challenges and success stories in their efforts to distribute COVID-19 vaccines and support equitable vaccine distribution for under-resourced populations. Five key actions stakeholders need to take emerged from the conversation:
1. Invest internally in policies supporting equity. During the past year, many organizations worked to improve internal processes that would better enable them to serve the diverse needs of their members and staff. L.A. Care Health Plan, the nation’s largest public health plan with nearly 2.2 million members, for example, developed a set of more robust internal policies to address diversity and inclusion, as well as programs designed to minimize barriers in working with minority or women-owned businesses, an approach described in the Clinical Improvement Network Connections spring 2021 publication.
2. Facilitate real-time data sharing. All groups agreed that, while there had been investments in data-sharing that facilitated collaboration to distribute and ensure access to vaccines, there were still gaps between health care delivery systems, public health and community-based organizations in terms of the accuracy of, and timeliness with which, essential clinical data was shared. As we begin to recover from the pandemic work should be done to ensure real-time data-sharing, especially between the California Immunization Registry and health information exchanges and organizations not traditionally part of health care information exchanges.
3. Provide clear, consistent and trusted communication. It was extremely important for all entities to streamline, test and regularly deliver communications campaigns to stakeholders, including community members, provider groups and member patients.
4. Leverage trusted relationships from primary care providers. Primary care providers were unable to play a significant role in the early days of vaccine distribution, often because mass vaccination sites were prioritized so individual practices received limited vaccine supply or were unprepared to accommodate the stringent storage requirements. With vaccine distribution having stabilized, there is an opportunity to tap into the primary care provider community, which is positioned to leverage long-standing patient relationships and play an important role in vaccination efforts. Increasing primary care’s role in COVID-19 vaccine administration may prove extremely effective in reaching vaccine-hesitant or skeptical patients.
5. Sustain new and strengthened partnerships. Overall, there was a recognition that the public health emergency and response has illuminated how effective cross-sector collaboration between health plans, public health departments, provider groups and community-based organizations can be at solving urgent problems when working together. Now, there is a question about how partnering groups can continue to collaborate while finding ways to become more efficient.
COVID-19 Vaccine Resources
Addressing Social Determinants of Health Essential to Reining in Health Care Costs
January 11th, 2021
Health care’s exorbitant costs can never be controlled without fundamentally shifting society’s focus toward the underlying social and economic conditions that disproportionately contribute to ill-health. That was the message former Centers for Medicare and Medicaid Services (CMS) Administrator Donald Berwick gave to large employer members of the Pacific Business Group on Health (PBGH) during a January 7 webinar.
“I’ve lost patience with marginal change. I don’t think it’s going to work,” said Berwick, a pediatrician who led CMS for a year-and-a-half during the Obama administration and who has been a leading voice for health care reform for over four decades. “We continue to confiscate resources in health care that we don’t deserve and aren’t using properly from other sectors that badly need those resources. It’s time for some big thinking.”
The Shadow of Racism and Poverty
In a presentation subtitled “The Moral Determinants of Health,” Berwick hammered home the need to tackle systemic issues like disparities in income, education, food access, housing security and community structure. He pointed to extensive and long-standing evidence showing the outsized impact these factors have on care access, outcomes, health status and ultimately, cost.
In one example, Berwick noted that individuals who’ve been subjected to at least four adverse childhood experiences (ACE) face dramatically higher risks for nine out the top 10 leading causes of death in the U.S. They’re also 10 times more likely to experience mental illness and 11 times more likely to suffer from Alzheimer’s disease, he said. ACEs can include experiencing violence, abuse or neglect, witnessing violence, or living in a household with substance misuse, mental health problems or parental separation due to incarceration.
The COVID-19 pandemic has both exposed and exacerbated the country’s long-standing health inequities, he noted, particularly as they relate to people of color, with black Americans dying of the virus at a rate three-to-four times higher than whites.
‘Fixing the Road’
According to Berwick, unless efforts are made to move upstream to address social and economic challenges and reallocate a portion of the dollars now flowing into health care toward housing, education, food, criminal justice reform and the like, rising costs and widening disparities will continue to be hallmarks of the U.S. health system.
Berwick went on to outline his personal vision for health care transformation in the U.S., components of which include making health care universally available. He also stressed other priorities, such as ending hunger and homelessness, restoring American leadership on climate change and restoring the credibility of democratic institutions.
He noted that PBGH has been an “extremely important force and presence” in efforts to reform health care for decades and applauded the organization’s willingness to engage seriously in pursuit of solutions. Nonetheless, he said, employers generally have largely remained “bystanders” in efforts to address the social determinants of health and challenged purchasers to consider how they can affect change.
“You’re concerned about your health care costs as an employer and the costs for your employees, so connect the dots,” he said. “With 18% of our GDP and $3.5 trillion a year, health care is running a repair shop. But nobody’s fixing the road.”
The webinar, which includes a panel of health care purchasers sharing their organizations’ approach to addressing social determinants of health can be viewed in full below.