Many employers fear the healthcare crisis is incurable, and with good reason.
According to a study by the Peterson Center on Healthcare and the Kaiser Family Foundation, healthcare spending increased by nearly a trillion dollars between 2009 and 2019. Last year alone put Americans $140 billion in medical debt. Even the federal government is seeking solutions: the No Surprise Act, set to take effect Jan. 1, 2022, aims to bring greater transparency to healthcare costs and reign in this multi-trillion dollar industry.
Employers are on the front lines when it comes to shouldering these rising costs, but what can they do to
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“We are in a real healthcare crisis, and a lot of employers are saying that they cannot continue to sustain this year after year,” says Gaalass. “I’m a big believer in positive outcome reimbursement, meaning that doctors should be paid for positive outcomes as opposed to just being paid for providing a service, regardless of the outcome.”
In a positive outcome reimbursement plan, insurance providers would reimburse doctors based on their history of patient outcomes. For example, if a doctor is able to perform surgeries with low rates of hospital readmissions and infection, insurance companies would pay them back more money. This practice is already in place, as carriers have set up special networks for healthcare providers who offer a higher rate of positive outcomes.
Not only does this incentivize doctors to provide better care, since the provider is financially motivated to ensure quality service, but it reduces costs for employers and employees while preventing costs associated with absenteeism and low productivity, Gaalaas says.
“Let’s say that I've had abdominal surgery, and the doctor follows up and everything goes well,” Gaalaas says. “I'm not missing work. I don’t have to take extra medication for an infection or have a short-term disability. This also means that the employer keeps my claims down.”
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Positive outcome reimbursements could help drive healthcare cost transparency as well, since carriers highlight providers who keep costs low and provide effective services. Employees can shop around for care and find a professional that meets their health and financial needs.
Employers and employees should also become more comfortable questioning inflated healthcare prices. People will push back against a mechanic who demands $10,000 to fix something that is not justly worth that cost, but would not dare to do the same to doctors, Gaalaas explains.
“People need to have greater dialogues with their doctors about the services that they're saying are necessary,” says Gaalaas. “Ask, should I try other things before the doctor sends me in for this very expensive service or prescription drug?”
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Although the healthcare crisis cannot be solved with a single shift in payment models, positive outcome reimbursements potentially guarantee quality care and in turn, healthier employees. But Gaalass still suggests employers take the time to analyze their claims data to understand their employees’ needs and consider all available healthcare options.
“For me, it’s about having a long-term strategy,” Gaalaas says. “If employers are not unearthing and looking under every stone for different options and alternatives to this healthcare crisis, then I don't think their healthcare plans will be sustainable.”
