It’s well-recognized that health care spending in the United States continues to rise, and is increasingly problematic for employers who offer health benefits, and the workforce receiving those benefits. In 2024, the Kaiser Family Foundation reported through their annual employer survey that the annual premium for coverage of a family of four was $25,572, an increase of 7% over the previous year, and roughly 25% of this premium cost was borne by employees. This does not consider significant employee out-of-pocket payments for deductibles, co-payments and co-insurance, which may lead to delays in seeking necessary care.
Increased spending on health care is attributed to many factors, such as labor cost increases and other inflation, consolidation of health care provider organizations, price gouging, and new and expensive drugs and technologies. While these factors are outside of control for the typical employer, at least 25% of healthcare spending is attributable to poor health and preventable conditions. Employers of any size can help to improve the health of their workforce and reduce utilization and cost by adopting principles of population health, by promoting healthy lifestyles and organizational cultures of health, and encouraging the use of preventive services.
One of the most effective strategies employers can adopt is encouraging all employees to establish a relationship with a primary care provider (PCP). High-quality PCP’s, including physicians and nurse practitioners, are trained to administer preventive measures on schedule, educate on healthy lifestyles, promote smoking cessation, and identify and treat risk factors for chronic conditions, including obesity, hypertension, hyperlipidemia, and pre-diabetes. Increasingly, PCP practices also screen for depression and other mental health concerns and are able to offer on-site support or timely referral for counseling. While many large employers are establishing on-site or near-site clinics, recognizing these benefits, most employers either have geographically dispersed workforces or would not be able to sustain a practice solely with their employees and dependents. What all employers can do is educate the workforce on the importance of primary care, provide incentives for annual preventive visits, and/or offer plans that require selection of a PCP (HMO or Point of Service plans, e.g.). Employers also can ask their carriers to report on primary care utilization rates, to identify covered lives that do not have a PCP, and to do outreach to promote selection of a PCP.
A variety of other approaches can also be adopted by employers at low cost to improve population health and productivity and decrease utilization and cost. Let’s look at just a few examples:
- Diabetes Prevention: According to the American Diabetes Association, over 11% of the US population has diabetes and an additional 98 million Americans have pre-diabetes. The cost of a person with diabetes is more than 2.5 time greater than for a person without diabetes. And, diabetes is preventable, through healthy lifestyle and early management of risk factors. The National Diabetes Prevention Program (DPP), promoted through the US Centers for Disease Control and Prevention, is an evidence-based lifestyle change program that many health plans already cover, and that also is available through a wide variety of vendors as an in-person or virtual offering. Multiple studies have shown that completion of the DPP reduces risk of developing diabetes by over 50%. More information on the DPP is available at: https://www.cdc.gov/diabetes-prevention/programs/index.html
- Early Detection and Management of Hypertension: Roughly 30% of the working-age population has hypertension (high blood pressure), making it the most common chronic condition in the workforce. Hypertension can lead to heart disease and stroke and exacerbates outcomes for many other conditions including diabetes. Annual costs for workers with hypertension are approximately 44% higher ($3,000+) than for those without hypertension. Thirty percent of people with hypertension are unaware that they have it, and of those who are aware, only 65% have their blood pressure under control. Employers can easily adopt well-being program and benefit strategies to significantly impact these numbers, starting with promoting primary care as already discussed. Additional strategies include promoting self-measurement by covering blood pressure cuffs (an investment of under $65 per device) and offering health coaching for self-management. Additional information on the costs of hypertension and employer strategies to improve prevention and management are available through the National Hypetension Control Roundtable, at https://hypertensioncontrol.org/resources/
- Encouraging Age- and Gender-Appropriate Cancer Screenings: The benefits of early detection of screenable cancers, including breast, cervical, and colo-rectal cancer, are well-recognized, yet cancer screening rates in the U.S. are far below desired levels. For example, one in three working age adults have not been screened for colo-rectal cancer. The Affordable Care Act removed a financial barrier to screening, by providing first-dollar coverage for those preventive measures given an “A” or “B” rating by the US Preventive Services Task Force. Employers should be actively engaged, with their health plans, in ensuring that employees are educated and aware of the screening schedule, receive reminders when screenings are due, and are encouraged to schedule a screening. To improve access and convenience, some employers now offer on-site screenings, such as through mobile screening vans offered by partnering health systems, and/or offer paid time off for preventive measures such as PCP visits and cancer screenings.
Of course, these are just a few examples, and there are many other opportunities, including promotion of vaccines, supporting mental health, encouraging smoking cessation, encouraging physical activity, etc. At a minimum, employers can begin the well-being journey by finding out which preventive services and programs already are covered by their health plans, how their plans are tracking utilization rates, and what they are doing to improve these rates. Vendor point solutions, such as health coaching, while not practical for all employers, also may be an investment with a positive return.
The key message is that health care costs will continue to escalate until and unless we collectively get a handle on promoting a societal and organizational culture of health and well-being, and our programs and benefit offerings reflect this philosophy!