Pushing The Right Buttons

Pushing The Right Buttons

Experimenting with benefits may create a potent brew of incentives that produce better employee health.

What lever or combination of levers do you pull to get your employees to do what you want them to do? At the most basic level, it’s compensation. They work, you pay. No work? No pay! It’s that simple.

But what if the behavior you want to encourage in your employees is more complex? It may take a more complex incentive or a more sophisticated mix of incentives to achieve what you want as an employer. That’s particularly true when it comes to the connection between health benefits and healthy employees.

Unless you’re part of the anti-vaccine crowd, most people would agree that taking medication that’s prescribed for you is good for your health. Medication can be prescribed on a limited basis to treat a temporary medical condition (for example, an antibiotic for a bacterial infection). Or medication can be prescribed on a continuing basis to treat a chronic medical condition (a statin for high cholesterol). Either way, it’s best that you take it.

The improper use of medication added $213 billion to the nation’s health care tab in 2012, according to a report from the IMS Institute for Healthcare Informatics (bit.ly/1cjM8Hl). Of that amount, $105.4 billion, or nearly half, came from people simply not taking their pills or not taking them properly.

How many prescriptions go unfilled? As many as one-third of the prescriptions written by primary care physicians never make it to the pharmacy, according to a study published in the Annals of Internal Medicine (bit.ly/1dMUU4u).

Clearly, common sense and better health care are not two of the levers anyone can pull to make people fill and refill their prescriptions or take their medications as prescribed. There must be another way, and the Annals of Internal Medicine study and a second piece of research suggest that employers working with their health insurance carriers may be in the best position to get people to do the right thing.

The Annals of Internal Medicine study concluded that medication adherence may improve by lowering drug costs, lowering copayments and increasing follow-up visits with prescribing physicians for patients with chronic medical conditions.

Implementing that for employers means crafting a health benefits package aimed at those targets. Maybe using a pharmacy benefits manager or requiring employees to buy their meds cheaply online in bulk? Maybe eliminating copays for prescriptions? Maybe creating a rewards program for employees who schedule and keep follow-up appointments with doctors?

The second study tested some of those same ideas. The study, which appeared in the March issue of Health Affairs (bit.ly/1nubV6k) examined the effectiveness of 76 value-based insurance design (VBID) plans used by a pharmacy benefits manager with 33 employers. VBID plans correlate enrollees’ out-of-pocket costs with the clinical value of a particular medical treatment. Out-of-pocket costs for a highly effective medical treatment would be lower than the out-of-pocket costs for a less effective medical treatment.

The researchers found that VBID plans with five characteristics working in concert prompted employees to fill prescriptions and take their medication properly. The successful plans:

  • Offered more generous benefits (lower copays).
  • Targeted high-risk patients.
  • Offered wellness programs.
  • Did not offer disease management programs.
  • Required medications to be ordered by mail.

What the study showed was that the right benefits in the right combination can incentivize employees to take their medicine and stay on the job.

Short take

Here’s another pro—and another con—of the Patient Protection and Affordable Care Act, which requires employers with 50 or more employees to provide health benefits to workers starting in 2015. A new study in the Journal of the American Medical Association (bit.ly/1jVYGIJ) found that nonelderly adults with private insurance were far more likely to be able to make a first-time appointment with a new doctor than people on Medicaid or uninsured people willing to pay cash. That’s good for the health and well-being of newly insured employees. But it will cost employers. A new report from the employer group American Health Policy Institute (bit.ly/1h2VICy) says the ACA will add as much as $5,900 per year to health benefit costs per employee at large employers by the year 2023.


In the April column (bit.ly/1jnqEiG), we discussed how employers can help employees take advantage of the health care price and quality transparency movement and become better shoppers for health care services. Here are three additional resources for businesses that want to take that step:

  • The Leapfrog Group, which represents employers, entered a partnership arrangement with Castlight Health, a health care price-transparency firm. Castlight will take the hospital patient safety data that Leapfrog collects in its annual survey of nearly 1,500 hospitals and make that information available to individuals in an easy-to-understand format, so they can decide where they have the greatest odds of surviving a hospital stay. (You can read more about the partnership at bit.ly/1hwTC8D).
  • Two employer-friendly groups, Catalyst for Payment Reform and the Health Care Incentives Improvement Institute, released a report card on state health care price-transparency laws and their ability to provide consumers with useful health care price information to make informed choices. Forty-five states, including Minnesota, got Fs. Three states got Cs; and two states got Bs. The report is available at bit.ly/QcKtfV.
  • The Healthcare Financial Management Association, which represents health care CFO types, has released a big report on strategies to improve price transparency in health care (bit.ly/1eIh9ZF). It specifically called on employers to use and expand transparency tools for employees.

We told you so.

David Burda (twitter.com/@davidrburda, dburda@msp-c.com) is editorial director, health care strategies, for MSP-C, where he serves as the chief healthcare content strategist and health care subject matter expert.

Related Stories