Top Threats, Priorities in Employer-Sponsored Health Plan Benefits

Employers shared the main threats and priorities that they encounter as they try to manage employer-sponsored health plan benefits, according to a survey from the Midwest Business Group on Health (MBGH).

“Employers are faced with a growing number of fiduciary responsibilities and must pay attention to the value of services they purchase,” Cheryl Larson, president and chief executive officer of MBGH, said in the press release.

“As a result, we see a greater focus on efforts to improve prescription drug and healthcare prices and transparency. Employers must negotiate their contracts with vendors to reduce hidden fees or they miss an opportunity to hold their vendors accountable.”

The organization surveyed almost 60 large self-insured employers from a broad span of industries. The survey was conducted in 2022.

The top three threats to employer-sponsored healthcare coverage according to employer respondents were: high-cost pharmacy claims (94 percent), medical inflation (91 percent), and extremely expensive therapies with Food and Drug Administration approval (91 percent). Other obstacles included expensive medical claims, specialty drug spending, and high-cost patient populations.

In response to these and other threats, employers highlighted certain priorities, from managing pharmacy costs to bolstering mental healthcare services.

Nearly all the employers indicated that engagement in programs and benefits was a key priority for their health benefits strategies (96 percent) as well as communication around health benefits (94 percent). Over 90 percent of employers also mentioned that financial wellness, mental health, well-being, chronic disease management, preventive care services, and specialty drug management were also priorities.

Most employers also agreed that diversity, equity and inclusion and the culture around health in their companies were priorities.

Almost three-quarters of employers stated that managing specialty drugs was a key facet of their pharmacy benefits strategies. Separately, experts have predicted that in 2023 specialty pharmacies will be the focal point of payers’ cost control efforts.

When designing plans to address employers’ pharmacy benefit priorities, 72 percent of employers said that their goal was to direct employees toward more affordable drugs. Two-thirds of the respondents wanted to tighten up their contracts with pharmacy benefit managers (PBMs). Employers also planned to tackle high costs by focusing on complex cases and specialty drug costs and auditing health plans and PBMs.

However, employers are not taking the full weight of prescription drug spending reform on themselves. Over eight in ten employers stated that the pharmacy drug market will require market-based and government interventions (81 percent).

In the wake of the coronavirus pandemic, employers are leaning on telehealth to boost employee access to mental health benefits. Nearly three-quarters of employers said that they plan to offer low-cost or zero-cost telemental healthcare. Additionally, 52 percent will give employees schedule flexibility to take advantage of mental health benefits.

Employers may tend to take a more paternal approach to employer-sponsored healthcare benefits, but when it comes to mental health they will not be the only advocates for healthcare benefit usage. More than half of the respondents said they would train managers to understand the importance of the company’s mental healthcare benefits.

The respondents saw their fiduciary responsibilities as including compliance with certain regulations such as mental healthcare parity and the Consolidated Appropriations Act, accessing health plan and PBM claims data, and recognizing the impact that payments have on employee benefit consultant, broker, and third-party administrator services.