How many times has it been said that the cost of employer-sponsored healthcare coverage (including prescription drug costs) is too expensive now - and costs continue to rise. Employers are striving to provide their employees with the coverage they need, but there is so much more than simply coverage to consider. Supporting employee health and wellness is an investment in the workforce, promoting higher productivity and satisfaction. Many of the opportunities to obtain ROI on this area are buried in big data and big data analytics. Diverse suppliers can help mine that information, by utilizing the data to uncover much more than rates of certain illnesses or pharmacy costs. They can help employers benchmark their programs against others within their industry, identify areas where safety can be improved, develop preventative programs, and inform decision-making about costs, to name but a few.
USING DATA TO LOOK AHEAD
The COVID-19 pandemic has driven change in the healthcare industry and also caused an economic burden on businesses. Employees found themselves looking much closer at their coverage and safety issues. Improving employee health outcomes has been a goal for many years, but the pandemic highlighted the urgency, as people with chronic diseases were found to be more likely to experience severe coronavirus symptoms. According to Mercer data, healthcare costs only rose approximately 1.9-percent in 2020 for big employers during the pandemic, but this is a false picture, because it was due to people not making as many trips to doctor offices, and many elective surgeries being postponed. As life returns to normal, employers are now dealing with the post-pandemic catch-up scenario, and many have no idea what the impact will be.
Keeping employees healthy and engaged in wellness is always important, and diverse suppliers have opportunities to help by delivering data-driven opportunities to address a variety of health and wellness challenges. Pete Edgmon is an underwriting consultant and employee benefits specialist at Stephens Insurance, and he says that health insurance underwriting begins with analyzing the nature of the company, beginning with demographics. Data analytics identifies information such as the prevalence of certain medical conditions, the type of work employees do (strenuous versus office work), age and gender. Employee data sets are segmented for the purposes of analysis and predictions concerning changes in employee pools. Data is used to predict things such as the type of medical issues and treatments employees are likely to use post-pandemic, i.e. many employees with bone and muscle issues did not see their doctors during the pandemic, but will now do so post-pandemic. Forecasting healthcare utilization and pharmaceutical spending for employee pools will help employers manage costs.
FOCUS ON PREVENTION
Health related data analytics can help employers optimize health spending, by identifying what employees are experiencing, and connecting health issues to employee demographics. For example, treating depression and anxiety produces 4:1 return in improved health and work productivity, while addressing inequities in employees of different races and ethnicities could save approximately $80 billion by reducing missed work days. Data analytics can help employers develop preventative programs, benefitting both employees and the employer. Disease prevention and management initiatives can significantly reduce healthcare costs, but initiative design needs a data-based foundation.
Data-driven employee wellness can also drive employer investments to increase organizational performance. Benchmarking against industry standards helps design wellness programs that reduce absenteeism and increase productivity. Data analysis can include industry trends and claims data. Analyzing factors such as weight, alcohol intake, mental health and sedentary lifestyle can help employers define the focus and goals of the wellness program. Optimizing workplace wellness programs through data analysis can improve wellness initiative design, implementation and assessment. Also important is employee feedback. In fact, data analytics can help the employer design better safety programs, by putting focus on high risk areas.
Self-insured employers are a major source of new opportunities for diverse suppliers, too. They must depend on themselves for data-driven solutions for the financial management of healthcare plans. Artemis Health develops tools for self-insured employers, using inputs such as claims data. The Artemis Platform can provide information on things like the cost of a diabetic drug, employer paid claims, and the total spend on the drug each time a prescription is filled. The platform can then compare a generic drug that provides the same benefits to the employees but at a much lower cost to the employer. There are many opportunities to develop these kinds of platforms for different sizes of businesses.
A lot of focus is placed on large employers, but employee health benefits are a significant portion of the total expenses of a small business. The Kaiser Family Foundation defines small businesses as those employing less than 200 workers, and the Foundation’s research found that 67% of these organizations paid $455-$910 per month in family coverage premiums.
SUPPLIERS NEEDED AT EVERY STAGE OF DEVELOPMENT
AI Multiple features data-driven, high tech insights and solutions for companies in industries such as fintech, retail, and healthcare. It should be noted that this is a process to become a data-driven enterprise, and it may take various supplier partners to reach the technology level desired, for example utilization of AI. Employers interested in reaching an AI maturity level in health and wellness management need vendors who can assist with digital transformation, developing and implementing key initiatives, setting up an analytics framework for critical decision-making, and operationalizing company data as much as possible for autonomous decision-making.
Diverse vendors have numerous opportunities, because technology continues to advance. Think outside the box when considering what employers may/will need in order to maximize the ROI of their investment in healthcare. Except in the largest companies, technologies such as AI are not anywhere near fully utilized. It is an excellent time to develop new data-based products and services that will help those small and medium-sized businesses, struggling to cope with rising healthcare costs while delivering the best options possible to their employees.