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Employers Plan Aggressive Response To Shifting Health Care Landscape, Towers Watson/National Business Group On Health Survey Finds

Stocks in this article: TW

Nearly two-thirds of respondents offer employees financial rewards to encourage participation in health programs, but tougher requirements are on the way. Today, 16% of companies align their rewards/penalties to specific biometric targets (other than tobacco use), and another 31% are considering this strategy for 2014. There is also growing interest in expanding financial incentives to include spouses: 59% of respondents anticipate doing so by 2014, up from 23% that did so in 2012.

“Companies recognize the need to create value-based benefit designs and develop a supportive workforce culture to engage employees in their own well-being,” said Fontanetta. “In fact, our study identifies a group of best-performing companies with much lower cost increases over the last four years than the median respondents. These companies have achieved critical success in cost reduction and improvements in workforce health and productivity. And they provide instructive lessons for other companies to follow.”

The best performers had an average health care cost increase of 1.7% in 2012, less than half the median increase and roughly in line with the general inflation trend. In 2013, this group took a number of significant steps to improve the efficiency of their health care programs. They:

  • Consolidated vendors to improve delivery and coordination of health management programs, while also taking steps to incent providers to invest in new technologies to improve the coordination of care
  • Focused more on communication to help employees make smarter health care decisions, leveraging popular culture technology like social media to make sure they have the best information on health care providers available
  • Stepped up emphasis on transparency in provider prices as well as quality and results
  • Invested in case management to more proactively and effectively manage their high-cost cases
  • Placed more responsibility on employees, tying financial incentives to measurable improvements in their health, and extended incentives to spouses
  • Started implementing new payment methods to providers, placing greater responsibility on them to deliver high-quality, efficient care

About the Survey

The 18th annual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in Health Care tracks employers’ strategies and practices, and the results of their efforts to provide and manage health benefits for their workforce. The survey was completed by 583 employers, between November 2012 and January 2013, and reflects respondents’ 2012 and 2013 health program decisions and strategies and, in some cases, their 2014 plans. Respondents collectively employ 11.3 million full-time employees and have 8.5 million employees enrolled in their health care programs, equating to a collective $103 billion in total health care expenditures.

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