Explore breakthrough insights on reducing healthcare cost and improving employee affordability, access and outcomes.
You can access the full event on demand here.
Meet the Panelists:
- Moderator: Ashok Subramanian, CEO of Centivo
- Panelist: Ann C. Greiner, President & CEO of Primary Care Collaborative
- Panelist: Brandon Batiste, MPH, VP for Health Care Innovation at Morgan Health
- Panelist: Dan Cahalane, President & CEO of American Roller Company
- Panelist: Milt Ezzard, VP of Global Benefits & Mobility at Activision Blizzard
Welcome, Attendee Survey & Introductions
Ashok Subramanian: We thank all of you for joining, and we thank you in advance for what we hope to be a candid thought, provoking dialogue across a number of pioneers in healthcare benefits, business primary care. And we’re really looking forward to a rich, authentic dialogue, not just about solutions or sales pitches, but frankly, to really step back and reflect on how the healthcare system is working today, where there are opportunities for improvement, and frankly, where there are signs of hope, signs of optimism that we can actually move forward for a more equitable, a more affordable, a higher access, and ultimately a more sustainable solution for all of us who grapple with these issues on a day to day basis.
So, as we get started, we’re going to launch a short three question survey. And so that’s going to show on your screen in a moment. If you could take a minute to answer the three questions. It’ll give all of us a nice range of where we all come from, and the diversity that we represent.
Give it another ten seconds for anyone who had some technical challenges. Going once. Going twice. Alright. So, who are we? And why are we here? As Admiral Stockdale might have said at the 1992 vice Presidential Debate. So a pretty good mix of geography, we’ve got to work a little bit harder in the South. So, 40% in the northeast, another 40% in in the Midwest. Dan, I think we call that God’s country, right? For a reason. 11% Milt, your old stopping ground in the West. Nice mix of roles as it relates to benefit advisors, benefit decision makers, business owners, leaders.
And maybe the money ball question is, Billy Bean might say: How important is affordability to your employees and clients? 95% very important, 5% somewhat important. Nobody said, “not that important” which I think probably validates one thing, which is that we have no trolls on this webinar today, who’s going to say that we don’t have an affordability problem.
Well, the good news is, we have people who are making a difference and are driving the solutions with us here today to have that conversation. So, I wish I had the ability to lay down the soundtrack for let’s get ready to rumble but instead, I’m going to ask each of you to bring your own energy to the beginning of this roundtable. Ann, we will start with you.
Ann Greiner: Well, thanks so much for the invitation to be here. My name is Ann Greiner, and I’m the President and CEO of an organization called the Primary Care Collaborative. And we were started by a group of employers, big employers, and some physician groups because the employers couldn’t offer the kind of primary care they wanted to offer, or they couldn’t buy it, I should say, and the physicians felt like they couldn’t provide it. And so, they came together around a new model of care called the Patient Centered Medical Home, which I think you are likely aware of. And we’re working now to try to get better financing for PCMH and other advanced models of primary care. We believe that we need to invest more in primary care through new kinds of payment models to really realize the value of primary care. So pleased to be here. Thank you.
Ashok Subramanian: Fantastic thanks for joining us, and thanks for all the work you do to advocate on behalf of primary care. We’re going to get into that quite a bit over the next hour. Brandon, I’m going to turn it over to you next.
Brandon Batiste: Good afternoon, everyone, Brandon Bastiste here. I am a Vice President with Morgan Health. Morgan Health is a business unit with JP Morgan Chase, and our mission is focused on improving the affordability, quality, and equity of healthcare and employer sponsored insurance. My role within Morgan Health is to focus on everything cardio metabolic, chronic disease management, obesity, GOP Ones and in partnership with benefits colleagues so good to meet you all.
Ashok Subramanian: Thank you, Brandon. Dan.
Dan Cahalane: Likewise, thank you for the invite. My name is Dan Cahalane, and I’m the President and CEO of a middle-market manufacturing company called American Roller, with ten locations across the country. I’ve been here 19 years, and prior to that I was with a large company, a big International called ABB Group. So, I’m a user of healthcare in a lot of ways from a big company perspective, but in the last 19 years, in middle market manufacturing.
Ashok Subramanian: And Dan, we appreciate your leadership on this issue. You know, I think one of the things we’ll talk about is the fastest way we can get to more sustainable solutions in this area of healthcare is for CEOs to actually take an interest in it. And that’s certainly something you’ve done, and we look forward to talking about that some more. And last, but certainly not least, Milt.
Milt Ezzard: Thank you Ashok for having me. Hello, everybody. I’m Milt Ezzard. I lead global benefits for a game development company called Activision Blizzard, based in Southern California. I am based in South Florida myself. I’ve been with the organization about 11 years roughly, 8,000 US employees now. Our joy has been to reimagine how we could offer benefits for employees over the past decade and building an ecosystem of tools and resources that support employees that are extremely a diverse set understandably yet doing it in a way that proves to be as efficient as possible given our current environment for healthcare.
Ashok Subramanian: Milt, you’re too you’re too humble to say this for yourself, but you’ve been recognized on Glass Door and many, many other forums as being amongst the most progressive benefit leaders in in the country. So again, thank you for your support in the cause.
Milt Ezzard: Thanks, Ashok.
Challenges Facing Employers in Providing Healthcare Coverage to Employees
Ashok Subramanian: So, let’s jump in. I think we would love to have a dialogue around the problems, and the more we hear from all of you, and the less we hear from me, probably the better for everybody. So, Dan, I’d love to start with you, kind of representing that middle-market employer. How would you describe the challenge that employers face in providing healthcare coverage to their employees?
Dan Cahalane: Yeah, I would say, you know, I’m going to speak from a manufacturing perspective when I say middle-market, and there’s a lot of different industries right outside of manufacturing. But when it comes to manufacturing in the United States middle-market over the last decade we have seen the raises that we’re able to maybe put into the market, there’s been years it’s been 0%, a good year is 2%. And oh, wow! You’re doing great at 3%.
Oftentimes the healthcare cost increases when you’re self-funded, or really any funding, have offset those increases. So for the last decade I have been talking to our on the shop floor — I’m a very visible leader and we talk openly — I have to hit it directly like, look, I get it. Your 2% raise was just wiped out by healthcare every year. And I say so the last decade you’re not getting ahead. And yet those cell phone bills don’t go down right. And we get more electronic toys to play with that cost money. I get it, and we as a company haven’t figured out the secret sauce because we cannot always unilaterally just raise prices right? So that’s been going on. And I would say for most manufacturers in middle-market, they’d all be nodding their head, saying, yep, yep, that’s exactly what’s been going on. So, we’ve been communicating for over a decade on that problem right there.
Ashok Subramanian: Now, Milt. Again. You also represent an employer, a purchaser. Maybe not the exact same challenges that Dan has in manufacturing. I think many of us may be familiar with one of your most popular titles, Call of Duty. Which probably has slightly better margins than what might come out of the manufacturing world. But you have your own challenges that you’ve had to work through over the last decade, and you’ve done so well maintaining a well-below-market healthcare trend. So where do you see the problems from your perspective?
Milt Ezzard: My main concern is the prevalence of high-cost claimants and being able to have control or influence over how those claims are managed. How choices are made in the in the care paradigm, if you will. Being able to understand if the expense is necessary as it always shows up being other than that. I mean, our population is, probably compared to Dan’s, a little bit younger, probably a little bit lower risk health score wise, just, you know, stereotyping. Sorry Dan.
Dan Cahalane: I think you’re right. In manufacturing the average age is 45 – 50 years old. It has a much older profile than a lot of other industries, for sure.
Milt Ezzard: Right. The other challenge we always have is keeping up with the Silicon Valley set of employers with whom we compete for talent. Right? We want to make sure that we’re very competitive and able to attract and retain and we, you know, are very thoughtful about the programs that we add to add that extra little bit of hopefully hook for employee population.
Ashok Subramanian: Great. And so, Brandon, as you listen to Milt and to Dan, and as you do your work on the Morgan Health side, as it relates to innovation and health equity. Talk to us a little bit about how these themes resonate? How does this connect with the types of problems that you see from your chair and the kinds of things Morgan health is trying to solve.
Brandon Batiste: Great question. I think it resonates in the landscape itself, and how the landscape has really changed over the last several years. You know, traditional healthcare is quite different to a new generation of people, and if you really think about it, healthcare in many cases has become increasingly more transactional with so many entrants into the market. And so, you think about urgent care, digital health retail like value based primary care. There’s also pay biters, right payers and providers who manage the health and the reimbursement. Then you have ambulatory surgery centers. The point is that there are a lot of options. And these options have created a level of convenience. The challenge, though, and the problem, I think, is that these options often lack established relationships, and also the system based connections of traditional primary care, and that can make it difficult for patients to navigate a complex healthcare system, but also to be connected to more comprehensive supports, thinking about things like prevention and screening.
Now, you have all these new entrants into a market that are also competing for similar resources. Right? So, we think about provider strain. We think about nurses and physicians, and those shrinking resources that are now becoming more in demand. And so those are some of the things that we’ve been thinking about as we look across the broader landscape. Just how traditional care has really changed to be more transactional in many cases, and I think the value there is to find ways to integrate through more collaborate, more collaborative, integrated opportunities.
Ashok Subramanian: Great. It’s super helpful to see that perspective. And then, Ann, you noted the very founding of the Primary Care Collaborative comes from the energy of the employer community. Yet you represent this often-underrepresented forgotten stakeholder in the healthcare delivery system which is primary care. Where do those problems and opportunities resonate with you?
Ann Greiner: Well, thanks for the question. We’re actually a 70-member organization that is very diverse. Yes, we do have primary care clinicians and behavioral health clinicians. But we also have consumer organizations, health plans, employer groups, tech companies. But the common denominator is a recognition that we need to strengthen the foundation of our system. Because, I think, as Brandon pointed out, we’ve got a lot more entrants into the market, a lot more variety in the ways that people access care. But I don’t think most people would agree that we have a system that is more coherent. In fact, I think they might say it’s more chaotic, and more transactional, less apt for you to have that longitudinal relationship with someone who knows you over time, which the research suggests actually is how you get the best kind of care.
One other observation, you know, over the over the last ten to fifteen years, is that we’ve also had an expansion in coverage with the Affordable Care Act. But unfortunately, we haven’t had a reduction in costs, and I know that that weighs heavily on all of us – employers, public payers, state governments, the Federal Government, and we haven’t solved for that issue yet. I would say that actually strengthening the foundation which is primary care can help us solve for that issue.
Ashok Subramanian: I definitely want to dig into that as we get deeper into the fundamental payment issue which you raised in in your opening remarks.
CEOs and Leaders as Activists in Employer Health Plan Innovation
Ashok Subramanian: Well, Milt, we’ll start with you. I’m going to go to both you and Dan. You have both in your own ways, from your own vantage points, been activists in your employer plan. Speak to us a little bit — Milt, starting, starting with you – what has motivated you to be an activist? You could just as easily say, “Yeah, I run benefits and I’m basically going check the market every three years for blue, red, yellow, green, and I’ve done my job. You’ve taken the opposite approach. You’ve been a vanguard at the earliest innovations when it comes to not only health plan delivery, but health care delivery. What’s motivated you, and what have you been looking for as you’ve gone down that path of innovating for your employees and their families?
Milt Ezzard: Well, I’m easily bored, right? And I’ve been doing what you described under other leaders for so long. I had a lot of pent-up energy. When I joined Activision Blizzard, I actually was hired and reported to the Chief Strategy Officer. So, it wasn’t to an HR leader that had, you know, preconceived ideas about how things need to be status quo and keep it at a 6% trend. He actually gave me the latitude to take our resources and experiment and deliver the value that we wanted to deliver. And we have. And we still have incredibly attainable opportunities to be more efficient, to be more innovative, to stand out from the crowd, if you will amongst the employee base and provide an ecosystem of of resources and tools that actually are delighting employees instead of just being table stakes. And, you know, taken for granted. Then that’s how benefits should be regarded in my mind.
We’re often the ugly step-sister to the compensation team and the total rewards function right? And I wanted to take an opportunity to show that we weren’t just that kind of to be taken for granted set of resources that we really could have some impact. So that’s I think that’s what motivated me. I had the opportunity, because I had a person who is very open minded, which really helps pave the way. I also knew there are a lot of new resources available at our fingertips that we could employ to change things up.
Ashok Subramanian: It’s fascinating, as I listen to you, I hear benefits as a business leader. And let’s manage this as a business. Let’s try to achieve outcomes not just manage it as a set of administrative tasks. Dan, I’d sort of throw a similar question to you. There are a lot of CEOs who think benefits is the last thing they should be spending time on, and they have HR teams and other people handling it. Just make sure that it works when my wife shows up at the doctor right? That that’s sort of the extent that a lot of CEOs get involved in this, if I can gender cast even for a moment. But you’re different. You decided to take this seriously. So same question, what motivated you to get involved? What has motivated you to stay involved and drive change in your health plan?
Dan Cahalane: It’s a great question. And two things jump to mind. I will say, having a good team in that space, our HR Team that tees that up for me and says, hey, are you aware of this? Are you thinking of that? It’s just not me. It’s a team that does it. But there are things that jump right out at you when you’re big enough in middle-market, and you’re self-funded. This is big numbers to the bottom line. Yes, you have stop loss that can help protect you from the big high claims. But the day-to-day that happens is moving the needle of profitability.
But, more importantly, we have to recruit people, especially manufacturing folks. We don’t have a foosball table in the lunchroom and Bring Your Dog to Work Day. We’re not necessarily cool. So how do we compete with bigger companies, luxurious appearing benefits? So those two drivers are why any CEO should be absolutely engaged in this. Quite frankly, if any of them aren’t, I think it’s mostly because it’s a very confusing landscape.
A lot of what I do is just simplify it for myself and for our employees, because if you try to dig into what you all know about the healthcare system, and even the jargon you’re using today, you will lose us so fast because we’re in a lot of other areas. We’re not digging into the details like you guys are. So, I would say, those are the two things that cause this to get on my radar screen, and why I’ve spent the time with the team that I have.
Ashok Subramanian: I’m now for the next 39 min going to be self-checking on how much jargon I’m using. So, thanks for thanks for that heads up. But look, it’s really inspiring whether it’s a care issue, a cost issue or a or an employee experience issue to see both of your motivation. Ann, you work with a lot of employers. What do we need to do to get everyone to be Milt and Dan, because I don’t think that’s what you see every day. Tell us what you see every day.
Ann Greiner: I certainly don’t. Employers have their businesses to run and so they rely a lot on consultants, and I understand that consultants have a lot of ideas about ways that they may best serve the employees of a given company. But I don’t think that we’ve really figured out how to scale the best ideas, to really transform the healthcare system. And that’s what we need to do. I think ideally, employers need to come together around how to advance a set of ideas, and it shouldn’t be in a vacuum. There are a lot of things that the public payers are doing and, ideally, we’ve got all payers working in a more coherent way, because that’s how we’re going to get the change we need to reduce costs, increase population, health and close equity gaps.
Now, if I’ll give you one figure, I think about it every day. We are almost six years behind our European counterparts in life expectancy, and we spend so much more than they do. And we’re the United States. We can fix this. I think it’s not so much rocket science. I think it’s just where we put our dollars and what we require, because you all are writing those checks.
Why Employers Need to Spend More on Primary Care
Ashok Subramanian: Ann, I’m going to give you a quick follow up, and then, Brandon, I want to come over to you. Ann, you said earlier that one of the things that you’re focused on is, how do we find the dollars to pay for primary care? You’ve got two people with budgets here on this call. What’s your pitch? Make your sales pitch for why employers need to spend more on primary care. Why, it’s not an expense. It’s an investment.
Ann Greiner: Well, I think one question I have for you is whether you are asking your health plan colleagues what their expenditures on primary care are? Because that’s where you’re going to get a healthier workforce. And most don’t know. We have really been pitching this idea to state governments, to the federal government, and yes to employers. And it’s beginning to catch fire.
What we know is that we’re actually spending less than five cents on the dollar for primary care. That is spend across all payors. So that would be the first thing. Get transparency, begin to understand what the expenditures are, and then ask what is your proactive strategy to keep people healthy and return them to health. Because that’s really what we should be focused on, not fixing folks after they’ve already gone down the road of a chronic care condition and need a lot of specialist intervention and acute care end up in the hospital. Let’s keep them healthy. Let’s return them to health once they they get sick. That’s really what we want is a healthy workforce.
What Does a Good Employer Sponsored Health Plan Look Like?
Ashok Subramanian: When we were early at Centivo, one of the lines we used to try to galvanize employer support was, ‘Spend two times as much as you spend today on primary care, and you’ll spend 30% less overall,’ and shockingly, those numbers have actually come to pass. It really is a testament to the value of partnering more closely with advanced primary care in particular. Brandon, that’s a great segue, I think, to what does good look like? I often think that we, the employer community, are just beaten down by this annual cycle of bad news, whether it’s a rate, increase a trend report from their consultant, a high-cost claim report, the pipeline of biologics that are out there that are just crushing the potential budgets.
And then from an employee perspective, Dan you kind of referenced this a little bit when you’re on the shop floor, I often say, for most of America open enrollment is the announcement of the annual pay cut because there’s no way to actually make up for the cost increase that comes with healthcare. So, dispense with all that negativity that I just shared. You are allowed to think big thoughts on behalf of Morgan Health around inclusion and diversity and health equity. What does good look like? What does good for an employer health plan look like?
Brandon Batiste: I think it’s quite simple. I think it’s engagement, you know. I think that’s what good looks like, you know, when you think about it, there’s still a big issue with care being deferred right? And for a period of time, COVID-19 was the primary reason for people deferring care. And now it’s cost and so, as Ann mentioned, it’s understanding those expenditures, and coming up with the action plan.
But you know, there’s lots of data to show that primary care has not really returned to the rates pre-COVID. We understand that behavioral diagnoses are up across the board regardless of condition. We’re seeing mortality rates increase, particularly with the younger population. Cancer diagnoses are also increasing, particularly for later stage diseases. And so again, lots of negative comments there. But the value is that there is tremendous opportunity for us to improve, and I think we start by creating access right getting people connected to providers. And I think good really looks like one engagement, but also the connection to the ecosystem right to really be able to address all the specific needs of individual populations of people.
And so what does that look like? It looks like employers thinking about social determinants of health. Right? It looks like solving for things and thinking about health equity. Particularly related to programs and initiatives that are scalable. And also looks like integration of behavioral health into primary care. And then sensing certain things related to advanced primary care. That really takes the organization forward. So those some of the things that we’ve been thinking about in terms of ways to improve and again a big promotion of advanced prior primary care. But I think we start with engagement. Because it’s a big challenge.
Experiences Employers Face Implementing Innovative Health Plans
Ashok Subramanian: Dan, you’ve been on a journey for a number of years as a middle market manufacturer: becoming self-funded, thinking about alternatives beyond the big box health plans. Walk the audience through a little bit of your story and what you have learned. What I’d particularly love to hear is, it’s easy to always focus on a bunch of successes, but I’m guessing there might have been some bumps along the road, and I think it’s rich to hear some of that as well. So, walk us through the journey and the ups and the downs.
Dan Cahalane: Yeah, it’s a good question, and it’s interesting. It’s not like we came up with a plan and rolled it out and it worked. This has been a journey for us over ten years, and it starts with what Brandon just said – engagement – and I would also education. I make it a point to travel to all our facilities frequently. I do standup meetings, and one of the topics is healthcare and the cost of it. We have a culture at the company of profit sharing. So, our employees understand that self-funding means that the company pays out of profits for most of our healthcare. They understand that if we can be healthier together, then ultimately, we might financially, in addition to our health, benefit from that. But that takes a long time and repetitive conversations for that to start to stick in the brain.
Then we provide options. What’s kind of interesting about us is because we’re across ten locations we can’t have Centivo’s model of heavy primary care in all of our locations. You asked Ann earlier; how do you prove that if you spend more money on primary care that you’re going to get the return on the back end? We can prove it because we actually have two different plans, and we can watch the performance. So, we’ve proven the model. That’s why we believe in it. Quite frankly, that’s probably why I’m here. It’s like, hey, Centivo, let’s get this network wider across the country, right? And then incentivize. If we can all collectively save money, then our premiums for those that are in the primary care model are lower than those that choose otherwise. Not so for us. I haven’t had to force it on anybody. I haven’t had to say, ‘This is our new plan you must use because we’ve learned over the years.’ If you start disrupting the doctors that they’re comfortable with, you’ve got a mess on your hands in terms of managing employee morale and employee buy-in. So, we’ve been able to walk through this over time every year as opposed to a Big Bang kind of event.
Now, if you would ask me, how did we get down this journey of improvement year over year? Tweak. I will tell you again it’s back to the team, the progressive thinking of Tom England on our team. But, interestingly enough, and I know a lot of brokers are on this call, a broker brought this to us. A broker knew that we were a progressive, open-minded company, and they knew that if they didn’t bring us solutions for taking care of our employees and managing costs, we would be looking for something else. We’d always be looking. And so, this kind of journey was driven by a broker, and good, solid broker leadership. And I will tell you for any of you that are brokers on the call, I would make millions of dollars if I could count the number of emails that I get from all insurance people around the world wanting to set up a meeting to talk to us about how they can help us. And we’d say no to them for the most part, because when you sit in these meetings it’s oftentimes the same story repeated over and over. And very few are bringing revolutionary new ideas. And that’s the culture of who we are. We’re new idea people. So, when those folks brought this to us and helped us with the education, it wasn’t us just being smart on our own, and helping us navigate that, that’s what came together.
It’s what Brandon said. It’s the engagement. I don’t understand the healthcare system, and I’m not going to try and figure it out. But I’m smart enough to know that if we can incentivize employees to use a primary care model, and they actually do, in the end everybody wins. And it’s that simple for me. I’m not going to understand who’s paying who and how the United States healthcare system works versus so and so. I don’t really care. I’m just going to focus on that little easy to understand box.
Ashok Subramanian: Well, Dan, you’re in you’re in safe company. Milt, I’m curious. You shared with us earlier the openness you’ve had and to be innovative, to be progressive. And that’s been more recently, at least over the last decade or so paired with organizational support. You have executed and implemented a lot of things, but you’ve also been very rigorous in measuring success and determining what stays, what goes, what needs to be tweaked, what needs to be adjusted. These aren’t one and done events. What have been some of your learnings, how do you then kind of continue that process to be iterative and improve and not just assume ‘Hey, look, I implemented something in 2022, and I’m good. I’m done.’
Milt Ezzard: Well, obviously the the the ecosystem of resources and tools continues to evolve faster and faster. So putting in a simple telemedicine plan back in 2016, obviously, things have changed a lot with virtual care since then, and it requires constant evaluation measurement. And it’s tricky. I think everybody is excited when they say they can measure, that they can provide ROI and everything else. You know, I’ve not found that to be the case at all.
We use a well-being resource and we put a lot of money on the table for people who want to do the right thing with regard to their well-being, people can earn up to $2,000 a year people can earn. But the truth is they actually have to earn it. We don’t just give them money to buy sneakers with. If you go to the gym under our program, you’re geolocated, scan the app, and you’re awarded $5 for actually going to the gym. And in that program, we measure engagement. We have over 60% of employees registered and engaged, and of the top two-thirds of engaged — measured by how many incentives they earn — those employees spend on average $2,000 less per year in medical care. That’s a wonderful story that I like to tell our CFO so that we can continue to offer this program? However, do I know, did the chicken precede the egg? Is it that the healthy person joining the plan is naturally going be spending less money anyway? Or is it the result of the wellbeing program?
So that’s what I mean by measurement. I like the concept of it, but I don’t stake everything on it as long as our overall bottom line of healthcare expenses is a reasonable trend, and we run under 2% year in and year out for the last 10 years, on average. So that’s usually a pretty good story.
But what we’ve learned along the way is that there’s a greater tolerance for employer engagement with employee healthcare from the employee standpoint. Back in the day, ten years ago, it was all about choice and giving people flexibility, ultra privacy. But during COVID we learned a lot about people’s willingness to be helped, and they’re willing. Their ignorance of how to navigate the system gives us more encouragement that we might be able to push the needle.
The same is true with regard to how we influence people to use advanced primary care. We’ve learned over time that employers can take a more active role and push the envelope. Do we want to choose a plan design that puts primary care in the center, and requires employees to navigate through primary care? Do we want to put a plan in place where we reward people for choosing that plan yet they can also have their regular old PPO if they want to pay for it? But within that plan we tightened down the rules of how they engage with it.
How do we get to affordability in employer-sponsored health plans?
Ashok Subramanian: That is a great segue to one of the questions we asked in the survey around affordability. Brandon, I’d love to start with you. 95% of our respondent’s said affordability is very important. You work for an institution who effectively, I’m going to paraphrase, is founded on the principle that we need to deliver affordability in the employer sponsored healthcare world. So how do we get there? How do we get to the affordability for employers that 95% of our participants here today say is very important?
Brandon Batiste: A great question, I think to start your strategy is in the data, right? I think it’s important to note that you can’t solve for problems that you don’t know exist. And so, to start with the data, it’s a great place. Do you have data to analyze? 2? Is it the right data? Is the data actionable? What’s missing?
And then marrying that with potential point solutions or programs or even initiatives to help to close those gaps. If there is no data, maybe there is an incentive to share data or even a report distribution process with partners. You know everything from performance guarantees leading all the way up to total cost of care. I think for many, it could be quite intimidating when you think about that value-based payment, total cost of care upside downside but I think the key is just to really start.
When we think about affordability, when we think about the opportunity to create meaningful impact, for me, it always starts with the data to really understand what the value is, what is the opportunity that we have as an organization to do meaningful work. And sometimes that doesn’t mean having to boil the ocean and try to address a really complex problem. Maybe it’s a regional focus. Maybe it’s something that’s really focused on the highest at risk, right? Or maybe it’s something connected to improving an existing point solution related to cost and quality.
And then there’s the policy point. There’s policy implications and things that particularly big employers can give more voice to which I think could really help to push the industry forward. As someone shared earlier, it’s also about sharing those best practices with other employers about what’s working well, what’s not working well, particularly when it comes to models associated with affordability and quality. There’s lots of opportunity for information sharing but those are some of the things that a high level that you know we think about, you know. But again, starting with the data to identify the problem and opportunities.
How does affordability impact providers ability to provide care?
Ashok Subramanian: That’s helpful, Brandon. Ann, before we jump into a couple of employer case studies with Dan and Milt, I’d love your perspective on something. One of the things that’s motivated me to devote the time spent to affordability is the dire need for affordability on behalf of the American worker. But the other part of it is what I’ve been more exposed to more recently. Over the past five to ten years is the impact that the lack of affordability and high deductibles have on the ability to actually deliver good care. Clinicians didn’t go to medical school worried about how their advice in terms of taking a medication, getting a test or doing a follow-up might be affected by whatever crummy health plan the patient might be on, if I could be so blunt. Could you share some thoughts or insight around things that you hear from your ecosystem on?
Ann Greiner: Absolutely. We hear from clinicians and primary care doctors and PAs and NPs that their patients are asking questions about whether something is covered under their high deductible health plan, or do I have to work my way through the deductible before it can be covered? They’re stressed out about that. And once they get a diagnosis, they don’t come back for treatment because they can’t afford it, or they can’t afford the drug that you’re telling them that they need. And it causes this moral injury for the primary care clinician. All of a sudden what they want to do for their patient, they can’t do because of this financial barrier, and I think this is contributing to burnout amongst primary care clinicians and other doctors.
I think there are some efforts that employers are embarking on to try to address this set of problems. There’s legislation on the hill that you would be able to pay for primary care in both brick and mortar and virtual in in your health plan. There are efforts to go outside of insurance with direct primary care. There are the kinds of things that you’re doing at Centivo. There’s near-site and on-site care. And I think these are all innovations to try to deal with the fact that the front door of the healthcare system is either closing or closed for too many people. And that results in much more expensive downstream care, which really affects people’s life. I mean, when you’re not healthy it has a profound effect on how you show up at work, how you take care of your family, how you interact in the world.
And unfortunately, this is happening to wide swatches of the American public. It’s low-income people. It’s middle-income people who are not able to get basic, important care to keep them healthy. So, I’ll get off the soapbox, but we’ve got a lot of work to do collectively to change this.
The Employee Impact
Ashok Subramanian: Dan, I would love to hear about the real employee impact, the family impact. As you’ve tweaked your plan over the years and have rolled out a plan with us that gives people the option to have free advanced primary care, and with the removal of some of the financial barriers like deductibles and coinsurance, and so on. Have you noticed any impact when it comes to peace of mind or folks’ ability to appreciate the benefits they have through you?
Dan Cahalane: You know, I think it’s a little too early to to have a long a list of things, we’re really only in year two. Probably the most tangible thing is the premiums. We’re in year two of no premium increases, which for a lot of manufacturers that’s unheard of. I’ve had people say, are you kidding me? What? How? Just slash your benefits? No, we didn’t slash our benefits. We actually improved them. The person on the shop floor, that’s what they see is that. And that means a lot to them.
I think Ann brought up a great point. We still have higher deductibles than I would like to see. So, when a shop floor team member has a very serious illness, it still has a huge financial impact on their family. Even though they’ve got our insurance right? They’ve still got that deductible. And so, we’re adding things you can with our program. You can buy supplemental, almost like insurance on top of a big event insurance, right? And that’s fairly affordable out of their paycheck. So, we do things like that. I would say, that’s the most tangible right now, but we’re in year two, and I expect we’ll continue to tweak it.
The one thing I forgot about is something Brandon mentioned. Don’t boil the ocean. I recall we first started with drugs. Again, our team pointed out, hey, look at all this money we sell on drugs. Let’s try and fix that first. So, we came up with prescription programs and sourcing. I forgot about that. That was several years ago. We started doing that, and that’s a case where an employee is trying to figure out how to come up with $200 a month for a prescription, and suddenly, with some of these programs, we can give it to them for free. So, to me, at the end of the day, that’s mostly what the shop floor, middle-market manufacturing person cares about. What’s my premium? And is it going up? And how big is my deductible? If you can control those things and give them a good package, they will feel good about it. The hard part is getting them to that primary care model, my wife included. I hope she’s not on listening.
Ashok Subramanian: If she’s a if she’s a broker, she probably is.
Dan Cahalane: I had to do some selling to go to the primary first — they will guide you to any specialists you need. Don’t worry. You can still see your specialists, right? I had a lot of internal selling to do.
Ashok Subramanian: Well, we have a lot of undoing to do as a society of some of the decisions from twenty, third years ago. I have a personal example, without going too much into it, where I needed a specialist, and I like all of our members am in a primary care model. The primary care team was the first one to say, of course, you need a specialist. So, we have this outdated mindset that the goal of primary care is to reduce specialist visits. That’s absolutely not true. The goal of primary care is to deliver great primary care, and great primary care includes truly being that partner to make sure you get the right specialty care when needed.
Milt, we’ll close this section off with you again. We joked at the beginning that affordability may not be the top issue for the workforce at Activision Blizzard King. But you, in your progressive nature, took a leap to go down the path of what I believe is the gold standard. What I’d love to see is the health plan that every American employer offers, which is extremely rich, that if you follow the rules, as you hinted at earlier, everything except pretty much emergency care is covered in full and that you have a swim lane, if you don’t exactly follow those rules. What inspired you to be so bold on that benefit design and from a quality perspective? What are you looking to see over the next several years?
Milt Ezzard: What inspired me to take a leap to a design where, if you follow the preferred path, your care is virtually no cost, very streamlined, no preauthorization hassles, etc., etc., etc. The reason for that is I think, employee education. I think a lot of benefit leaders will take a path of ‘we need to communicate. Meet them where they are. You know, we need to send lots of emails. We need to send home mailers, refrigerator magnets about what the right things to do are.’
I believe all those processes and modes of communicating and trying to influence employees are wasted energy. It can take years to recondition a mindset about how to properly access care. If you provide employees with the conventional path, but also offer an option which is significantly more attractive from a financial perspective it will attract a group of individuals who are willing to take that leap of a more controlled environment, but with greater returns, because they’re smarter. The conditioning toward what is the standard of care that everybody should be following is going to happen much faster that way, right? Instead of just trying to educate people out of their habits, if you will.
Granted, as Dan said, people aren’t that comfortable with changing their health plan choices, right? Inertia really carries them. I still have a lot of people who choose the PPO even though the premiums are really high. They think that’s the deluxe plan, and they should always be in that because they want the best for their family. We have a fairly small percentage of our population in the plan model through Centivo. But the population is growing in that plan. People are beginning to be conditioned that this plan model is really an attractive one, and that conditioning slowly spreads to the rest of the population. That peer-to-peer kind of experience sharing is what’s most effective.
I mean, it took forever to get virtual care off the ground, right? Virtual physical therapy, who thought that was legitimate until people tried it, then they started talking about, “Wow, this is just as effective.” And then, when COVID hit we had all these things in place for virtual care. People who are scrambling for their traditional brick and mortar care were directed to something that was actually awesome. And since then, our use of virtual care didn’t drop off very much. After COVID ended it continued at a fairly high level.
Advice to Employers Who Want to Be More Innovative
Ashok Subramanian: I’m going to give everyone 45 seconds and we’re going to do kind of a wrap question, and then we’ll take a couple of questions from the audience. What advice would you give to employers who want to be more innovative in how they approach their health plan and unlock this promise of affordability and quality? Brandon, I’ll start with you.
Brandon Batiste: Thank you for the question. I will say, look at health equity. Too often a focus on health equity is looked at as a vague commitment rather than a business problem with very specific objectives. There’s data to show that health inequities equate to something like $320 billion annually. So really investing in opportunities to look at the specific needs of your population and then marrying that with the environmental opportunities that DEI brings to support and supplement health equity-based work will really help to push your organization forward as a differentiator in the space. One of the biggest gaps that we see is just a lack of investment, but also lack of understanding about ways to push health equity-based initiatives forward.
Ashok Subramanian: Great, Ann?
Ann Greiner: Well, I think what I would say is, know your data. Know what the health plans that you contract with are spending on keeping your employees healthy. And what we know is that it really varies dramatically. Some health plans are spending 3%, some PE health plans. Present company, I believe, are spending, you know, 10-15%. So, know your data. And then, ask the question about how you’re going to keep folks healthy, because if you’re if your expenditures are at 3%, I got to tell you. Unless you have a very young population, they’re probably not going to be healthy.
Ashok Subramanian: Great. Dan, I’m going to have you close on this question. Advice to other employers who want to push the needle?
Dan Cahalane: I would say, don’t assume that this space is the same as other insurance. There are limited levers to pull with your homeowner’s insurance or your car insurance, right? It is what it is. There’s a lot of levers to pull in this space. Whether it’s drug, it’s the primary care model. So don’t assume you don’t have a lot of options, and approach it not as a cost savings, but how you can control the cost and add more value to employees so that you can use it as a recruiting tool. Go into it with that mindset and challenge your broker to start bringing some ideas that aren’t just the standard wrote and move on so we can collect our commission rate, and I’ll see you next year. Don’t accept that, and you never know what will come up. I think it’s a regional solution at times, so dig in.
Audience Questions & Conclusion
Ashok Subramanian: Game of thrones for health insurance. I love it. So, Milt, you can feel free to comment on that question as well. But I wanted to direct one of the audience questions to you. Because you spend a lot of time thinking about total cost of care and medical and pharmacy.
So, the question from the audience: How are you addressing the siloed approach to drugs versus medical benefit? Often the effort to minimize drug costs can result in higher medical costs and lower patient well-being. So, I know you, your team and your advisors put a lot of thought into these types of questions. How would you comment on that?
Milt Ezzard: That’s a really tough question.
Ashok Subramanian: That’s why I gave it to you.
Milt Ezzard: I don’t know if I’m going to be able to answer it. Obviously, we’re aware of pharmacy costs and the impact that that drugs are having, especially with good old GLP Ones that are beating down our door right now with regard to being a potential cost driver in the pharmacy space. But all that, said our, our pharmacy trend is actually moderated in the last year or two, for whatever reason, even though we do have a high number of specialty drugs in play among our population.
I hate to say we throw up our hands a little bit with the pharmacy space right now, where we don’t have much control. We’re in a bit of a collaborative purchasing space, so we don’t have a lot of transparency and pricing with our PBM, which is troublesome. We’re going to try to approach that in our next negotiation to be able to get some transparency. We know that our total cost of delivering pharmacy care is in line with or slightly below the market right now, and we’re trusting our PBM to do the right things to manage things even though the transparency isn’t where we’d like it to be.
Ashok Subramanian: Trust and PBM are not two words that often go in the same sentence. I know we’re going to wrap here in another minute, but another question did come in. Dan or Milt, if you have thoughts on this? The Johnson and Johnson lawsuit about the employee who said, I think that the drug price that I’m paying is a lot higher than if I had just gone to the drug store myself and paid cash. Without commenting on that specifically, are those kinds of things on your radar screens as employers, and again, very different employer perspectives in terms of size. But curious Dan, or Milt if you have a comment on that.
Dan Cahalane: That’s not on my radar screen. I’d have to ask our team. I did learn something new the other day about gene therapy as something I should start thinking about on my radar screen in the future. So, that’s the only news breaking we’ve been thinking about.
Ashok Subramanian: Great Milt, on your, on your radar screen or not?
Milt Ezzard: No, no, not really. We don’t have a a sense that we’re being inequitable or unfair in the way that things are priced from our plan, at least that I’m aware of.
Ashok Subramanian: Got it. Well, everyone. It’s at the top of the hour. So, Ann, Dan and Brandon, and Milt again appreciate the dialogue, the rich conversation. Thank you to all the all of you who joined us, and we look forward to carrying this on. Thank you.