Passive Player to Change Agent in Health Care | Mercer

Health & Benefits

Employers: From ‘Passive Player’ to ‘Change Agent’ in Health Care

Amidst so much sound and fury about how to best manage health care in the United States, it’s easy to overlook the fact that nearly two-thirds of all insured coverage is provided by employers, who collectively spend nearly $1 trillion annually on health benefits for their workforces. Employers are the pivotal players in today’s health care system, yet their role has remained remarkably passive.

Sharon Cunninghis, North American Leader of Mercer's Health business

Published on 20 October 2016 on BRINK

Yes, they absorb much of the cost of coverage, ensuring that they are in compliance with the complicated requirements of the Affordable Care Act and other regulations, while they provide many of the tools their employees need as insurance consumers, but a transformation is long overdue. Benefit cost increases outpace overall inflation, and 14.2 percent of payroll is allocated to health care benefits, according to Mercer’s National Survey of Employer–Sponsored Health Plans. Employers can drive meaningful change in the health care market by using their collective influence and speaking with a unified voice.

And they need to do so as expeditiously as possible.

The health care market is entering an era of rapid and continuous disruption. New tech-based entrants are adding more pressure to health plans, which are also facing consolidation pressures. Already, market fragmentation and shifting expectations are bringing more complexity. Alternative care delivery options are emerging, and diverse workforce preferences ensure that one size cannot fit all members.

Meanwhile, the promises of cost savings from genomics and personalized medicine haven’t yet been realized, and more restrictive plan designs and networks available on the public exchanges are likely to foster greater inequality among health care consumers. A new health market is emerging, and employers must capitalize on this formative period to redefine their role and shape the market to meet their strategic objectives.

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