Industry Voices

Health and Wellness – Implications for Health Exchanges

It is a transformational time in health care, for patients, care delivery systems and those who purchase health coverage. As health insurance exchanges usher in a new era of health care purchasing, it drives us to consider what the implications are for wellness programs. Employers who choose to shift from the role of “plan sponsor” to “plan supporter” will need to consider questions like:
 What changes will take place when wellness programs are bundled into exchange product offerings? 
 Will levels of wellness programs be differentiated by plan offerings?  
 How will state products vary and how will that affect multi-state employers?  

Time will tell, of course, but we have learned some lessons from our last 10 years of designing employer-sponsored wellness programs that can help determine whether effective wellness solutions become fundamental to individual products.  

For starters, we know that consumers will expect first generation health exchange offerings to deliver services that are efficient and price competitive. Keep in mind that state exchanges will vary significantly based on the viability of the exchanges themselves, and the number of competitive service offerings available in each state. 

While it is likely that some form of wellness services will be part of all baseline exchange offerings, how sophisticated and engaging their approaches are will determine how the market reacts. Will these wellness products be based on best practices so they are engaging for individuals, or will they simply be passive tools and services that are ultimately underutilized? If approached in the right manner, the health insurance exchanges represent considerable opportunities for wellness to gain market share that can be scaled, measured and evaluated.  

To adopt effective wellness solutions, exchanges will need to consider the following:
 Wellness programs provide the opportunity to drive engagement to broader care management, advocacy.
 Wellness programs for active participants will need to leverage technology, innovative service features such as mobile apps, social networks and challenges to drive more engagement by younger segments of the population.
 Incentives will be continue to be useful in driving engagement.
 Fitness will be core to any program offering.
 Price will matter. Buy-ups for wellness apps or programs will need to be integrated with mobile health plan programs, and will need to be consumer centric to adequately compete with commercially free products that consumers may already have. 
 Chronic care management and advocacy will have a role for older actives and pre-65 participants.

Education will be a key factor in the success of the exchanges because, at least initially, there will be widespread confusion about how the exchanges work, available products, how high-deductible health plans work, state availability, network availability (Kaiser in some states, not others), how to participate in programs, how to earn incentives, how deductibles work, and much more. Fortunately, we’ve learned much from the last decade of employer-sponsored wellness programs that can help, including:
 One-size-fits-all wellness programs don’t work — customization by work culture and individual employer is necessary to ensure success.
 Senior leadership involvement is needed to align corporate priorities to health priorities; simply outsourcing programs with no company linkage makes success less likely.
 Ongoing communication in a variety of forms and formats is necessary to reach a wide range of audiences.
 Programs need to be diverse, comprehensive and continuously updated in order to be effective in a diverse employee population.
 Effective incentives that drive intrinsic vs. extrinsic motivation are not delivered by cash alone.
 Consumer protections and strong oversight are necessary to ensure that access and the ability to improve health are available to all eligible employees.
 Simple messaging about changes in benefits, regulations, limits, etc., is essential.

Health exchanges may prove to be a unique opportunity to quickly address individual health needs, helping to transform and reshape first-generation wellness services to become “more sticky.” In other words, this could be a time where we witness higher utilization, more measurable health improvement and greater sustainability. Providing protections and oversight in state-based exchanges will be vitally important, all the while balancing the critical need to address the nation’s poor health and its resulting impact on employee incomes and economic growth.

Current estimates indicate that exchanges will ultimately be available to the 70 percent of the population who are employed by small companies. This sizable population may become the testing ground for exchange solutions to accelerate the evolution of wellness programs, with web-based applications and devices, and creative incentive designs leading to improved and measurable population health.  

We can’t say for sure whether health insurance exchanges will “dial back” wellness efforts due to cost pressures or if they will use the large-scale opportunity to spur the rapid evolution of wellness solutions that will create even more efficient, effective wellness approaches. Time will tell; however, I am certainly hoping for the latter.

About The Author - Shelly Wolff
Towers Watson

Towers Watson is a leading global professional services company that helps organizations improve performance through effective people, risk and financial management. With 14,000 associates around the world, we offer solutions in the areas of benefits, talent management, rewards, and   risk and capital management.