Healthcare spending for employers is projected to rise over 5% in 2021. The increase in spending is attributed to higher demand of non-emergent visits and procedures which are expected to make a return in 2021. On an average, employers are spending 7.6 percent of their annual operating budget on health benefits and the cost is going up steadily for years. The common tools (such as higher deductible and out of pocket cost sharing) used by most employers to control spend have been counterproductive, often led to poorer health outcomes and employee dissatisfaction with their benefits.
Employers have a new opportunity to make use of shifting utilization patterns (due to pandemic), to their advantage and implement practical strategies that reduce cost and improve outcomes for their people. The answer to savings and better outcomes lies inside their own data. Instead of boiling the ocean, employers can start by making a list of the top 4-5 conditions affecting their employee population and making a smart benefit design for each condition.
Musculoskeletal (MSK) is one of the top cost driver for employers and health plans, often making up 15%-20% of annual health spend. Musculoskeletal (MSK) conditions affect 1 in 2 employees in any given year, have a direct impact on employee’s absenteeism and presenteeism and hence performance. An effective, engaging musculoskeletal benefit program can save money and lead to healthier, happier employees.
Investing in high-quality high-value musculoskeletal (msk) benefit can have a greatest impact on your healthcare spend — in 2021 and beyond — and make an incredible impact on your employees and their families.
Here are 3 steps to redesign musculoskeletal benefits in a smart way, that will reduce your spend and improve outcomes for your people.
STEP 1: PRIORITIZE CONSERVATIVE CARE WITH SUBSIDIZATION
There are quite a few issues with the way health benefits are designed today but the biggest flaw in the current benefit design is lack of personalization. When the benefit plan is designed, the premium, subsidization and cost-sharing is often based on past claims which only reflect payments for treatments in the past and not the current or future needs of the population. We all know that needs evolve. The needs of the employee population post-pandemic are not the same as before.
Take musculoskeletal (MSK) care for instance. These benefits comes into use when an employee experience pain or injury related to muscles, joints, bones and ligaments. There is significant increase in sedentary lifestyle and lack of physical activity, which is causing back, neck and shoulder pain. Left untreated, this acute pain will exacerbate and transition to chronic pain, leading to surgeries and mental health issues downstream. Yet most 2021 plan documents look like replica of the past years.
Most acute issues such as back, neck, hip, shoulder, knee pain and injuries can be addressed effectively with conservative care options, such as physical therapy, chiropractic services etc. There is a growing body of research showing that not only is conservative care effective at relieving pain and restoring function, but it is more cost effective than other medically interventional approaches like injections and surgeries.
Employers can make conservative approaches to musculoskeletal (MSK) pain a first option with subsidization.
Most plan designs today don’t differentiate between conditions or treatment effectiveness. A visit by a healthy person for the sore throat is treated the same way (from cost-sharing standpoint) like a visit by another person with significant pain to a physical therapist – same deductible barrier, same copays. In other words, the cost-sharing has nothing to do with the individual’s specific condition and needs and the value of the treatment for that person’s unique needs. By providing higher subsidization to conservative high-value care, employers have the opportunity to make simple modifications to their health benefits plan and encourage (or incentivize) their people to consider seeking conservative care options, such as physical therapy, first.
The benefit leaders can use the following ideas to be more creative with their musculoskeletal (MSK) benefit design that encourages conservative care options:
- Waiving the deductible
- Reducing or waiving co-pays, or
- Lowering the maximum amount of co-pays/co-insurance.
With subsidization for high-value care, not only do employers reduce their cost of care but also reduce the potential for opioid prescriptions, steroid injections and surgeries.
The employees will have fewer lost work days. And better outcomes.
STEP 2: PRIORITIZE DIGITAL CARE
Telehealth has been gaining ground slowly but steadily for the last decade. COVID-19 pandemic accelerated its adoption by both consumer and providers. At this time, digital care for pain management can be considered as a viable, effective and desirable alternative to in-person musculoskeletal care, saving employers and health plans on cost by delivering care virtually.
Digital Musculoskeletal (MSK) care for pain management provides virtual care and services to employees with pain at every stage (acute, chronic, pre/post surgery) of their journey. For minor aches, pains and injuries, the virtual physical therapy services can connect employees with licensed physical therapists over video and messaging – who can quickly diagnose, prescribe and monitor personalized, guided exercise therapies.
For people suffering from chronic pain, the chronic pain management program can reduce pain, and improve function and boost overall health and wellbeing. This digital program uses evidence-based methodology that combines exercise therapy, behavioral health support & education to drive adherence. MSK assessment and triage can empower employees to make better decisions by providing them timely advice and help to pick the right treatment that leads to best outcomes.
By providing personalized care, health education, behavioral support and resources to employees to support their unique journeys, digital care for pain management provides one of the best ways to improve health outcomes for musculoskeletal conditions, and ultimately reduce cost.
STEP 3: REDUCE WASTE
Over 50% of the health spend is wasted and in the musculoskeletal category, most of this waste is concentrated in surgeries, imaging and drugs.
Over 80% of this waste is recoverable with good strategy, planning and execution. The strategy should take into account both demand-side (member-centered) and supply-side (provider-side) with a system that addresses inappropriate utilization and price variability.
For example, 35% of musculoskeletal (MSK) spend is concentrated among 4% persistent utilizers. These high need high cost group often have complex conditions and co-morbidities. The key characteristic of this group is low self-esteem and self-efficacy, both of which can’t be addressed in our fragmented medically interventional system. A person-centered care plan that addresses the specific goals of these individuals can have a significantly more impact than another steroid injection or surgical intervention. The care provided to these individuals which do not move the needle on outcomes is a waste.
15% of members cost 80% of spend in any given year and outside of the persistent utilizers group, the spend is concentrated among individuals who likely go through a surgical intervention in that year. A high number of these surgeries can be avoided with timely prediction and intervention.
On the supply-side, we notice significant price variation between providers. Reference-based pricing, bundled pricing, direct contracting and other value-based episodic or condition based pricing models can reduce the pricing variation and hence waste.
In summary, in 2021 more than ever before, the health care strategy is an integral part of the workforce strategy. There’s no blueprint for what we’re facing and benefit leaders need to change strategies to keep up. As a champion of their people’s health and safety, benefit leaders are best positioned to drive change by using innovative strategies and tools to improve quality and reduce cost.
What are you waiting for?
Sprite Health provides a digital-first destination to employees and their family members for all of their pain management needs. In addition, our cost-containment analytical tools and services eliminate waste to drive better financial outcomes. Leading employers choose Sprite Health to get better outcomes at lower cost – over 30% cost savings, reduction in unnecessary surgeries, opioid dependence, and absenteeism. In addition they provide their people an elevated experience with quick access to on-demand virtual care, evidence-based digital care programs for pain management, supported by our white-glove concierge service.