# Case Study: Breaking Down Barriers

## The Access Epidemic in Employer Sponsored Health Plans

## We looked at 7,667,614 episodes of care to see what kind of financial barriers employees and their families face

Across a total spend of $6.1 billion employees picked up 19.2% of the cost or about $1.1 billion.

And a lot of this was just due to price failure.

Here is some of what we learned

## Definition

**Price Failure:** A situation where the price of a good or service deviates significantly from its fair or expected value, often leading to inefficiencies in the market.

### Example #1

A $8,596 MRI of the Brain where the plan paid $7,450 and the employee paid $1,146.

**This should have only cost $699** or about half what the employee paid. So the employee needlessly paid over $1,000 and the employer overpaid by $6,751

### Example #2

A $60,589 Knee Replacement where the plan paid $57,244 and the employee paid $3,345.

**This should have only cost $19,000** - so the employee needlessly paid over $3,000 and the employer overpaid by $38,244

## We keep hearing that when employees have “skin in the game” they become better shoppers but we didn’t see much if any of that in the nearly 8,000,000 instances we looked at

**Health Affairs:** HDHPs did not significantly increase price shopping but reduced overall spending by decreasing utilization.

**National Bureau of Economic Research:** Patients with HDHPs reduced healthcare spending primarily by cutting back on care, not by seeking lower prices.

**Journal of General Internal Medicine:** HDHPs were associated with decreased use of preventive services and worse health outcomes.

## So “skin in the game” will encourage people to avoid care but it won’t make them good shoppers

The high cost of healthcare is a big burden on U.S. families, and that health care costs factor into decisions about seeking care. These costs and the prospect of unexpected medical bills also rank as the top financial worries for adults and their families.

**One in four U.S. adults** say they or a family member in their household had problems paying for health care in the past 12 months.

**About four in ten adults (41%)** report having debt due to medical including debts owed to credit cards, collections agencies, family and friends, and banks.

**About half of adults** would be unable to pay for an unexpected $500 medical bill in full.

## This is a BIG problem

When employees avoid medical care due to cost, it can lead to significant negative consequences for their health and financial well-being.

| **Impact** | **Description** |
| --- | --- |
| **Worsening Health Outcomes:** | Delaying or skipping necessary medical treatment can result in the worsening of health conditions. 55% of people with employer-based plans said a health condition worsened because they delayed or skipped care due to cost. |
| **Increased Medical Debt:** | Avoiding care often leads to increased medical debt when employees eventually seek treatment for more severe conditions. Many Americans report incurring medical debt, which can be a significant financial burden. |
| **Higher Mortality Risk:** | The financial burden of healthcare can have severe consequences, including increased mortality risk. Some reports indicate that delayed care has led to death for some individuals who could not afford the necessary treatment. |
| **Mental Health Impact:** | Skipping care due to cost can lead to anxiety and stress. A significant number of people with medical debt report feeling anxious or worried about their debt, which can further exacerbate health problems. |
| **Disproportionate Impact on Vulnerable Groups:** | The impact of healthcare costs is particularly severe among vulnerable populations, such as those with low incomes. These groups are more likely to skip or delay care due to cost, leading to greater health disparities. |

## And remember we looked at claims paid by employers and employees that totaled over $6.1 billion.

And many employees still don’t love their health plan.

The average Net Promoter Score (NPS) for health insurance in 2023 was reported to be around 27.

## But how do you remove barriers to care and deliver benefits employees love?

### Plan Design:

People should not be paying deductibles or copays if they are going to the right place. There should be a $0 out-of-pocket benefit for services that can be scheduled.

**This allows you to do 2 things:**

1. incentivize employees to choose the right provider
2. remove financial barriers to the care people need

### Concierge Support:

Concierge support can significantly enhance the employee experience by providing personalized services that simplify access to care. Employees benefit from reduced hassles and increased satisfaction. By addressing individual employee needs more effectively, concierge support can help employees make better healthcare decisions, ultimately contributing to better health outcomes and lower overall healthcare costs.