Creating The Perfect Health Plan Blueprint: So Simple It's Complex

"It's so simple it's complex." Those were the words of a Direct Primary Care physician attending a recent round table I hosted, as he was explaining the claims-reducing benefits of Direct Primary Care. An attending benefits manager chimed in astonished at how simple and straight-forward the physician made this model of care out to be. For her, it almost seemed to good to be true. Shortly after the round table I found myself sitting in my car pondering the complexities of the healthcare and health insurance industries. How have health plans become so difficult to navigate? Could creating the perfect health plan really be that easy? Well, I am here to tell you it is but it requires employers to look down a different path for success.

First, employers have to quit accepting the predictably bad outcomes the health insurance industry produces year after year. Benefits brokers and consultants have led employers to believe that the health insurance world is too complex to fix. Accepting predictably bad outcomes has become "best practice". If your current blueprint includes celebrating when negotiated renewal figures fall below the budgeted increase, the foundation for which your health plan is built will eventually crumble. You need to understand that you are playing a rigged game. Your health plan is designed to help everyone win except you. You have to change the way you go about drafting the blueprint. "Yeah, but Andy, my employees don't like change". Listen, I get it. Changing health insurance companies is not a fun transition for employees. However, this is not a hurdle, it is an excuse. If your employees knew that they could have a different healthcare experience they would be happy to change. If they knew that there was a way to interact with the healthcare system in a positive and effective fashion, they would welcome change. In the end, it is the employer who is resistant to change. Accepting predictably bad outcomes requires little work and little disruption. A change in the employer mindset is required.

Designing the blueprint for a solid health plan foundation is pretty simple. It is about helping your employees navigate the healthcare system while slashing the unit cost of care they receive. Today, you are asking your employees to navigate a broad PPO network on their own, a network filled with huge price and quality variation and a network strife with perverse incentives to over-diagnose and over-treat. You must give your employees access to the right tools and solutions that allow them to purchase healthcare services in a cost-effective way. Direct Primary Care (mentioned above) is a classic example of one such solution. Direct Primary Care has taken itself out of the fee-for-service healthcare system where the aforementioned perverse incentives exist. By simply shifting the way primary care is given and paid for, the duration and the quality of the office visit increases as does the effectiveness of the diagnoses and treatment plans. This is not rocket science. It is simply a shift in the way healthcare services are purchased and this formula easily translates to other areas of your healthcare spend.

Do you have Specialty drug utilization inside your health plan? I bet you do. Most plans in America do. The cost of this drug class continues to skyrocket with the average Specialty medication running north of $50,000 per year. However, most employers are not even aware of the simplicity of slashing the unit cost of these medications. By simply shifting where these drugs are purchased you can help the member and your health plan save both frustration and money. How about surgery claims? Don't you find it amazing that, inside the same health plan, one employee can have a knee replaced at a cost of $15,000 while another employee can undergo the same knee-replacement procedure for $50,000? There is not another industry out there where this kind of price variation exists. Even worse, the average healthcare consumer is inclined to believe the $50,000 surgery is of higher quality but that could not be farther from the truth. Fortunately, it is here where employers are given another opportunity to slash the unit cost of care by rewarding those willing to shift the care they receive to the high-quality facilities charging a fair price. Creating the perfect health plan is about making the complex simple. It is understanding that the blueprint your insurance carrier continues to draw up for you is a losing proposition (at least for you).

Cost-slashing opportunities exist throughout your health plan but you need to start challenging your broker to help you uncover these opportunities. Right now you are making his or her job way too easy. The days of providing your employees with nothing more than a national insurance carrier and a broad PPO network are over. You must focus on how healthcare services are purchased within your plan. By shifting where services are purchased you will significantly slash the unit cost of care and enhance the level of coverage your employees receive. This blueprint not only saves your organization a ton of confusion and frustration, it saves you a ton of money. Your health plan wins. Your employees win. You win. Yes, it is that simple.