3 min read

The Future Of Employee Benefits: Moving Beyond The Status Quo

Mar 21, 2016 6:30:00 AM

The_Future.jpgMoving beyond the status quo can no longer be cliché…it has to become reality. The health care industry needs a disruptive innovator with a model that can be replicated and scalable, which is no small task since the best health care decisions are made locally. With collaboration between providers and those who are closest to the consumption of services (i.e. the employer, the provider, the patient, and the family), what has been thought of as impossible is within reach.

Consolidation of the provider market has slowed with fewer physicians seeking hospital employment and hospital-employed physicians starting to seek independent groups. This is good news for the consumer.

As provider groups change, so will the networks in which they participate. For many years, a “broad” network including every facility imaginable was required just to stay in the business. Now, with the cost of care still rising by two to three times that of inflation each year and with millions of new patients in waiting rooms around the country, many employers are asking for strategies to select the highest quality, most cost-effective, and readily accessible providers. This means “narrower” networks, sometimes with single hospitals or outpatient centers. The ACA wants this model to be called an ACO. The 1980s and 1990s called it an HMO. Whatever name we give it, it requires sacrifice by all parties involved.

The industry has moved into an era of less personal contact and relationship with physicians while at the same time expecting higher patient engagement. Payers require electronic medical records, causing providers to spend more time looking at a screen than the patient. Many national insurers and stand-alone service providers have their own telemedicine physicians dispensing medical advice and medications. Convenient? Definitely. Appropriate? We’ll see. However, with increasing availability of transparency and advocacy tools, patients will have more say in who delivers their care and how they want it to be delivered.

Employee benefits will continue to evolve into a more holistic human capital consulting practice. Employers want a broad range of services around insurance products, not just the annual “shopping” to get the best rates. As employment continues to tighten, so will the ability to shuffle costs to the employee. It is likely there will be many parallels in the health insurance distribution to that of the evolution of pension/defined benefit plans into 401(k)/defined contribution plans.

The role of the advisor will become more focused on the consumer. Their efforts will shift to concentrate more on education, access (in person, phone, web, mobile, etc.), and connectivity to the individual.

As employee selection leads individuals away from employer sponsored plans, employers will need to compete for employees without insurance as a bargaining chip – which will create more focus on the employee experience. In order to be successful, companies will need to understand what type of person they should be trying to employ and what they can do to earn that type of person’s loyalty and commitment.

Employee activation and engagement will continue to be paramount. The delivery of health insurance will likely transition to from B2B to B2C, forcing employees to take ownership of their own health insurance and health care decisions. Employers will be forced to make the decision of engaging their employees to make informed and appropriate health insurance elections or wiping their hands clean and empowering their employees to figure it out on their own. The choice seems easy, but will be a dilemma for many.

Believe it or not, this is an exciting time in our industry. Hang on; this is going to be a wild ride. The future is now!

Gibson

Written by Gibson

Gibson is a team of risk management and employee benefits professionals with a passion for helping leaders look beyond what others see and get to the proactive side of insurance. As an employee-owned company, Gibson is driven by close relationships with their clients, employees, and the communities they serve. The first Gibson office opened in 1933 in Northern Indiana, and as the company’s reach grew, so did their team. Today, Gibson serves clients across the country from offices in Arizona, Illinois, Indiana, Michigan, and Utah.