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As attempts at controlling healthcare costs have failed to yield the desired results for clients, many are shifting their focus to value. But value isn’t just the cost of care.
Because of this shift, benefit and HR executives have found it challenging to communicate the impact of their health benefit programs to the C-suite.
In our research work with chief financial officers over the past 15 years, we have learned how broadly these leaders think about their health programs. Putting aside the need to control costs, which CFOs always recognize once a program is put in place, our
CFOs are focused on attracting and retaining employees, responding appropriately to government rules and regulations, and improving employee health, productivity and business performance. Surprisingly, fewer than half of the CFOs in our research said that controlling costs was the most important goal of their healthcare programs.
That is what leads us to the search for value. Simply put, controlling claims costs is not a value proposition. A value proposition must ultimately be tied to what the organization is trying to achieve in its business and where the opportunities arise to make those improvements. That’s where the value opportunity lies in our health programs.
In our work with employers on this issue, we strive to have them think top-down rather than bottom-up. That is, we find that when employers have access to more data from more programs, they often get mired in the details. Since most employers still manage their programs in separate silos with separate vendors, we encourage them to focus on 10 key dimensions of health and a single measure that reflects the status of each. These dimensions include:
- Financial. The total health related programs cost per employee.
- Program participation. The participating workers as a percent of eligible employees.
- Biometric screening. The employees that are meeting clinical targets as a percent of all employees.
- Health risks. The total number of health risks for each worker.
- Utilization. The employees receiving medical care as a percent of all employees.
- Preventive care. The workers receiving appropriate screenings as percent of all eligible employees.
- Chronic conditions. Employees with chronic conditions as a percent of all workers.
- Absence. The number of health-related lost workdays per employee.
- Lost productivity costs per employee.
- Employee engagement. The average health engagement score per employee.
The findings around these health metrics offers insight into what most directly impacts care delivery and workforce health. The data provides an opportunity to communicate pragmatically to the C-suite about the current health status of the workforce, opportunities to make improvements and the results of interventions around cost, lost work time and productivity. This sets the stage for a value conversation and why investing and managing health is critical to the performance of the business.
