It's time to redefine our health care system
It's time to redefine our health care system
By Rollin Lacy
All across the country, employers, employees, and providers are speaking out loud and clear. Our country's health care system must change.
By its very nature, our health care system puts employers and employees at odds with one another. Employers tend to focus on cost management - as does the traditional managed care industry. Employees want open access to caregivers, choice, and costs covered by employers. In the spectrum of coverage, as one moves away from traditional indemnity insurance toward managed care plans, personal control decreases and cost management increases.
Health plans and employers must create benefits strategies to solve this fundamental conflict. The challenge for employers: how to get the best cost management while still offering employees greater personal control, freedom, access, and choice.
A complicated issue
Complicating the challenge for employers is that only a small percentage of an employee population accounts for a large percentage of health care costs. Recent UNICARE studies show that only 8% of the patients in any given population represent 71% of total costs. Conversely, 68% of employees spend less than $150 a year on medical care.
On further analysis, about 40% of an employee population chooses a managed care plan; the other 60% remain in non-managed care. But the managed care members represent only 9% of the cost, because they are healthy. As a result, more money is funding their care than is necessary.
The traditional non-managed plans draw 60% of the members, who account for more than 90% of the costs because their members are higher utilizers of care. Consequently, traditional plans are insufficiently funded, which directly translates into increased costs. Managed care works only if it attracts an equal representation of all employees - not just the healthy.
Employees need reassurance that the industry's push to reduce costs has not compromised quality. They want to share in decision making, and they want greater flexibility and direct access to providers.
Employee concerns are reflected in the more than 1,000 managed care bills that were introduced in state legislatures in 1997 and in the "Consumer Bill of Rights and Responsibilities" currently being pushed at the federal level. These and other mandates - proposed in the name of consumer protection - can be expected to increase employers' health care costs.
Today's health care system is not poised to best meet everyone's needs. Tomorrow's system must empower employees to choose the health care options that work best for them. The payers must deliver long-term value to employers, and enable them to create a solution that meets their needs as well as those of their employees. For the system to function properly, it must reward providers who deliver quality care.
A successful delivery system must have three primary characteristics:
· It must provide real cost savings, offering solutions to employers and employees that maximize resources and meet needs.
· It must encourage employee responsibility and reward providers by offering incentives for good health behavior and consequences for behavior that is detrimental to health.
· It must inspire and empower employees to participate in the health care system and determine the plan that works for their family's needs.
Our vision of tomorrow's health care system entails returning control to employees and employers by combining the best elements of traditional indemnity insurance and managed care. It should include such features as:
· A proprietary personal needs assessment to assist employees in selecting a plan choice for themselves and family members based on their health needs, current health status, and financial goals. This self-determination process encourages members to take an active role in plan selection.
· Several cost-sharing features that allow members to select the type of financial risk with which they are comfortable.
· The ability of members to change plans if health needs change, or if they desire to elect more coverage. This contributes to a sense of empowerment and control that leads to a higher level of satisfaction with the health plan.
· Providing quality care by waiving the annual deductible for preventive measures and offering care management advocacy programs.
It's time to redefine our industry. We need to recreate for the American employee a vision of a health care system that really works.
[Rollin Lacy is senior vice president, special accounts, for UNICARE, the Boston-based national operating unit of WellPoint Health Networks (NYSE:WLP), one of the nation's largest publicly traded managed care companies. WellPoint serves approximately 6.8 million medical and nearly 22 million specialty members. UNICARE will be launching what it calls its 'PlanScape' system of health care options in Texas this fall, followed by a national rollout. For more information, contact Rollin Lacy at: UNICARE, 1 Constitution Plaza, Boston, MA 02129. Telephone: (617) 580-2002.]
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