In this video, the Informed Consulting team of Founder & Partner Jeff Oldham, Partner Sharon Bryan, and Consultant Anna Torchio discuss how employers can create an innovative employee benefits program for 2023 and beyond.
The topics they discuss include:
How employee benefit programs evolved over the last ten to 15-20 years
The advent of healthcare reform, HDHPs, the introduction to digital health solutions and democratization, and the expansion of wellness programs
How the role of the broker has evolved within the context of employee benefit programs
Evaluation of digital health solutions, technology utilization and delivery
What an optimized employee benefits program looks like
Analyzing demographic data, identifying cost drivers, understanding your population intimately, and seeking feedback
How digital health solutions can impact employees
Moving away from brick-and-mortar healthcare delivery, tackling more specific and relevant issues, more efficiently and effectively delivering care
How can employers improve their understanding of digital health solutions
Leveraging broker, consultant, and PBM expertise and utilizing claims data to narrow solution considerations
What insight brokers should provide to employers about digital health solutions
Let claims data guide digital health solution consideration and the importance of tight integrations
Key challenges digital health solutions face as they try to find distribution within employee benefit programs
Understanding their buyer's day-to-day intimately
We've provided a transcript below for your convenience. We hope you find the conversation valuable!
Michael Krieger: Hello everyone and welcome. I'm Michael Krieger. Today we're here with Jeff Oldham, the founder of Inform Consulting, Sharon Bryan, a partner at Inform Consulting, and Anna Torcio, a consultant at Inform Consulting. Welcome everybody.
Jeff Oldham, founder and partner at Informed Consulting: Hey, Michael. Great to be here.
How have employee benefit programs evolved over the last ten to 15 years?
The advent of healthcare reform, HDHPs, the introduction to digital health solutions and democratization, and the expansion of wellness programs
Michael Krieger: Today's conversation will be focused on employee benefit programs. I wanted to start with brief evolution of employee benefit programs. What have been key themes around these programs over the last five to ten years?
Jeff Oldham, founder and partner at Informed Consulting: If you don't mind, I'm going to back up a little further because one of the biggest changes that happened in our industry was the advent of healthcare reform in 2011.
It was a defining moment for a lot of self-insured employers as they transitioned to consumer-directed health plans (CDHP) or high-deductible health plans (HDHP). What that meant for employees was that they had to take on more risk. They had to be more responsible for their pre-deductible spending.
Then what I noticed at that time is, behind the scenes, there were these cottage industries evolving in something called digital health. What these companies tried to do is distribute their product through health plans and employers, but they were also trying to ensure that their members had the ability to benefit from their products by paying less while still receiving care. Bad things typically happen when members are non-compliant, and fortunately, digital health solutions made it easier to not avoid care.
Then let’s fast forward to the pandemic. Prior to the pandemic, you had multitudes of industries and companies forming – everything from behavioral health, MSK, diabetes, cardiovascular, metabolic disease, caregiving, etc. All of these types of solutions came into play. With brick-and-mortar closing for quite some time during the pandemic, people desperately needed care. So then, you actually had to look for digital health solutions as the first alternative.
Fast forward to 2023, there are a multitude of different, that people in the industry call, point solutions. They are around in various different categories.
So, healthcare reform put more risk and responsibility on the member. Then, industries with digital health companies wanted to be able to provide members with ways of managing their healthcare at home. The pandemic hits and fast-forwards digital health into the spotlight. Now that we're here in 2023, you have many different companies and many different industries that are out there. In many regards, they are beneficial to the members but also cause brokers, venture capitalist (VC) firms, and even CEOs or entrepreneurs to think differently relative to how they market and distribute their products.
Sharon Bryan, partner at Informed Consulting: There's also been an evolution with, for example, wellness. COVID exacerbated it, and now there is a real focus on allowing digital health solutions to provide a lot of services that were traditionally brick and mortar. It’s recognizing that reducing the friction point legitimately helps with user engagement.
Then with the evolution around wellness, as I mentioned, it was five years ago that we all heard about getting your steps, your vegetables, etc. Those types of wellness programs, and it's changed. It’s encouraging to see a big focus on mental health. There's also a huge focus on sleep. It’s a recognition that non-food or movement-related things impact our health. As an employer, by focusing on those things, you will have a more productive workforce.
How has the role of the broker evolved within the context of employee benefit programs?
Evaluation of digital health solutions, technology utilization and delivery
Michael Krieger: You mention the broker in there as a constituent sitting within the benefits ecosystem and them trying to understand the things that are happening here.
In terms of the employee benefit programs and how they've evolved, how has the role of the broker kind also evolved in helping to support these programs over the same time?
Sharon Bryan, partner at Informed Consulting: In the past 10 years, there's been a huge focus on, “How do you utilize technology within that employee benefit package?” Brokers initially had a mindset to focus on the products that they placed similar to property and casualty on the commercial side.
There's been an evolution. Now, there's a recognition that the process, in addition to how these products are distributed, is just as important. Brokers now have national tech consultants that help advise them on technology solutions, HCM solutions, and ben admin. They have population health practice leaders that are focused on digital health solutions.
Yet, we see the industry moving towards trying to understand how to pull all these pieces together so they are less siloed. From an employer's perspective, how they all fit together greatly influences the delivery and the experience for the user.
What does an optimized employee benefits program look like?
Analyzing demographic data, identifying cost drivers, understanding your population intimately, and seeking feedback
Michael Krieger: Getting back to the construction of the employee benefit programs, what does an optimized employee benefits program look like?
Jeff Oldham, founder and partner at Informed Consulting: It can vary wildly based on your demographics and industry. But what does that mean?
If you have all your employees in one place, like a hospital or a school, those folks aren't likely to live in social determinants of health (SDOH) or health plan shortage areas (HPSA). So, their benefits are gonna be constructed differently than people in transportation or people that don't have access to their brick-and-mortar physicians.
The first thing I would look at is the demographics of your organization.
Second, over the last couple of years or so, what have been the driving factors in your medical costs? What are those conditions? It's typically the Pareto 80-20 rule where 20 percent of folks are driving 80 percent of the costs. Then within that, there's only a handful of conditions that are driving that great percentage. You have to be cognizant of that.
Third, for the first time in American history, there are five generations in the workforce. So in addition to demographics and actual claims data, you need to look at benefits that are applicable to a very wide range of workers.
When I first started working, we probably had five benefits. They were medical, dental, life, disability, and 401k. That was it. Thanks for playing. Now with five generations, you have a variety of different things that are occurring.
As an example, women are delaying having children because they have student loan debt. Then with people having children later, it brought on the advent of the massive fertility industry. People are delaying buying houses due to the economy. Even all the way to caregiving where you have employees that are members of what the industry calls the “sandwich generation.” They're taking care of their parents, and they're taking care of their children. Then you sprinkle in the pandemic with this as well. These are all things that need to be managed.
So, there's no way to say all employers must have these benefits. An employer should be cognizant of their demographics, their claims, and the generations they have in the workforce.
Last but not least, ask your employees what would be beneficial to them above and beyond traditional healthcare products. There are forms of financial counseling or 529 plans to be offered, so things of that nature.
Sometimes I find, inadvertently, in our industry that people will say I know my population and they're going to want this. Again, with five generations and people working at a multitude of different locations for the majority of industries, you can't possibly know what's going on in your employees' lives above and beyond healthcare to know what they need. I just wouldn't make the assumption. I would look for any and every opportunity to listen to your employees through surveys to ensure that you're offering benefits that resonate with what they need.
At the end of the day, you have many industries that in their war for talent cannot use base salaries as their only mechanism for hiring employees. They have to use the diversity and wealth of their benefits program in order to attract people to work for them. That’s why listening to your employees is crucial in the development of a good plan.
Sharon Bryan, partner at Informed Consulting: I would add that when you're thinking about an employee benefits package, the integration between all of the different solutions that you want to deploy is critical. It’s not just looking at what you need individually, but thinking about how it all fits together. The tighter the integration, the better because that parlays into the other pieces of the puzzle.
Employers and HR leaders want to be more strategic and get executive-level buy-in, so they must have the ROI case study. They need to make sure they are consistently gathering the data they need to show a return on investment. It’s not just about getting the programs, but it’s also about understanding how they can prove ROI to keep those programs.
Anna Torchio, consultant at Informed Consulting: In terms of the integrations that everyone looks for when it comes to blending point solutions, or the programs that Jeff described, into a more cohesive consumer-type experience, I'm not sure it completely exists today in an accessible way.
I would always encourage employers to push their vendors, technology partners, broker partners, and health plan partners and to ask for these things. They respond to what their clients need and want. Large employers are high-dollar clients, and so the design of their product strategy will be based on the requests that they're getting.
For employers, it’s imperative that they don't forget the power that they have in driving the market toward developing more consumer-like, integrated, and seamless experiences for their employees.
How can digital health solutions impact employees?
Moving away from brick-and-mortar healthcare delivery, tackling more specific and relevant issues, more efficiently and effectively delivering care
Michael Krieger: In terms of the new innovative offerings for employers, what's the macro thesis around their ability to impact employees? Put another way, what value can they deliver versus traditional offerings?
Jeff Oldham, founder and partner at Informed Consulting: I hate to keep coming back to the pandemic, but it really opened the eyes of a lot of employers and brokers around the need to be able to provide different forms of benefits above and beyond brick-and-mortar.
Yes, telehealth was alive and well before the pandemic, but a great percentage of Americans didn't try it until the pandemic hit. Now if you would even suggest that you were going to take it away from them, that wouldn't go over very well.
It's interesting in healthcare. It's probably the last industry relative to financial services, obviously retail and the like, that still relies heavily on brick and mortar. The challenge with that is there are numerous statistics and studies that show there's a shortage of nurses. There's a shortage of physicians. There aren't enough physicians or will not be in the next five to ten years to fill the available MD vacancies in the United States.
Again, the timing of all of this is good, but it can serve to be really pragmatic. Other industries have figured out that there are other ways to serve your customers in and outside of brick and mortar.
I briefly gave the example of telehealth, but I've done some project work for a caregiving company. If you've ever cared for a loved one, it takes a team of people to look after them. When you don't have access to digital tools, it's incredibly complex to manage. Things like, “What specialist is my mom seeing on Monday? What meds does she need to take on Tuesday? What were her vitals on Wednesday?” That information needs to be shared with your caregiving team. So, these new companies in caregiving came about or evolved as a result of the pandemic.
That's just one of the numerous other digital health examples. In areas where there is a substantive, practical need, digital health can help solve these challenges.
Anna Torchio, consultant at Informed Consulting: I can add a personal example of how telemedicine has affected me. Having two small kids, everyone knows that when you have a family or you're growing your family, you are constantly being pulled in multiple directions. It can have a pretty big impact on your ability to perform your job based on those requirements while also trying to maintain your income level.
What telemedicine offers you is the freedom to access care quickly and efficiently. My daughter had pink eye last Thursday, and before I’d even been able to get into my doctor's office, I’d already contacted our telemedicine provider. We had a prescription called in within 90 minutes. All they had to do was a visual exam of her on the computer, and they checked the box. So, that probably saved me three hours of time. Not to mention the headache of pulling her out of daycare and then putting getting her back to daycare. It allowed me to maintain a routine and keep my family healthy for a lower cost.
How can employers improve their understanding of digital health solutions?
Leveraging broker, consultant, and PBM expertise and utilizing claims data to narrow solution considerations
Michael Krieger: How can employers improve their understanding of these new digital health solutions so that they can be introduced into programs and positively impact employees?
Jeff Oldham, founder and partner at Informed Consulting: The first place to look is with your broker or consultant. The majority of national brokerage and consulting firms now have digital health practices. They have people that are responsible for looking at the market to determine which companies, products, and services would align best with their customers.
The second place is through your health plan or PBM. Now, most have established defined ecosystems for digital health or digital therapeutics in order to be able to offer these programs in the context of their existing health plan arrangement.
The third is at a variety of different conferences that are solely focused on digital health.
Employers don't have to look at this as if they're managing on their own. There are a lot of different experts, including our day job, where new and emerging technologies are constantly being evaluated to better understand what solutions can help employers in our country. It's not a burden an employer has to take care of by themselves.
What insight should brokers provide to employers about digital health solutions?
Let claims data guide digital health solution consideration and the importance of tight integrations
Michael Krieger: What opportunity is there for brokers to provide greater value to their clients?
Sharon Bryan, partner at Informed Consulting: When it comes to managing self-funded medical plans, brokers are always looking at claims. You want to come back to your claims and your claim reporting being your North Star.
Every group is different, and there are a ton of different digital health solutions that might be great for one group but may not be a top priority for yours based on that claim information.
Going back to being strategic, it’s important to provide that value.
What are some key challenges digital health solutions face as they try to find distribution within employee benefit programs?
Navigating the B2B2C self-insured, large employer world and why it’s important to align with industry-experienced investors and leaders, and understanding your buyer
Michael Krieger: What are some of the key challenges those solutions face when trying to find their way into the employer offering?
Anna Torchio, consultant at Informed Consulting: What we see is the development of a solution that can be great for anybody such as a virtual dermatologist or access to telemedicine across any of their healthcare needs. That’s great, but they don’t understand who they’re initially selling to. Is it the employer Total Rewards team, or those ben admins?
Entrepreneurs don't necessarily have the experience or the insight into what their day-to-day is like. What is their life like every day? What are they thinking about? What are you selling to them? Is what you're selling going to put a lot of work on their shoulders? Do you have ROI data so they don't have to come up with it on their own? How are you gonna disseminate it to their employees? Is it in a channel that is existing today? Do they even have email addresses on file? What are the impacts from a data integration perspective?
All of these things are what employer buyers are thinking about. The entrepreneurs don't necessarily have insight into what they are assessing and all of the minute details that go into to them being able to approve and pitch it to their leadership. Then, there are also approvals from a security, budget, and legal perspective.
I would definitely encourage entrepreneurs in the digital health space to take the time to interview total rewards professionals or ben admins. Really put yourself in their shoes and that'll help you be a stronger seller in the space.