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PPACA World: Employer blindfold?

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Dr. Bruce Sherman is urging users of private exchange programs and other new health benefits programs to remember why employers have employees.

Controlling benefits spending is important, but keeping productive employees healthy enough to produce at a high level is also important, Sherman said in a recent interview.

Too often, when employers give cash-strapped workers a choice between low-premium plans with high out-of-pocket costs, and high-premium plans with low out-of-pocket costs, the workers choose the low-premium plan, Sherman said.

“Simply because they need to have that money at hand to cover their cost of daily living,” Sherman said. 

When employers send workers to a public or private exchange program, without doing anything to track the employees’ health or make sure they are getting adequate access to the right kind of care, “they’re effectively outsourcing their responsibility for managing workers’ health and well-being,” Sherman said. “That may come back to haunt them. The employers have ceded control.”

Bruce Sherman

Sherman is the medical director for population health management at RightOpt, the private exchange program set up by Buck Consultants, a unit of Xerox. He’s also a professor at the Case Western Reserve University medical school, and a consulting medical director at Employers Health Coalition.

In 1999, Employers Health set up one of the early group health coverage purchasing cooperatives. Those cooperatives are forerunner of the modern private exchange system, and also of the Patient Protection and Affordable Care Act (PPACA) public exchange system.

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Sherman said RightOpt managers are aiming to do business with employers that recognize that keeping employees healthy makes business sense. The exchange is letting employers offer coverage options from different insurers, including PPACA public exchange plan issuers, while operating databases and data analysis tools that help employers see how well the enrollees are using preventive health benefits, how well they are using exchange program wellness and condition management tools, and how healthy they seem to be.

The company said its private exchange program serves employers with a total of about 400,000 health plan enrollees.

RightOpt managers want to make sure employers understand the financial importance of investing in human capital, and in designing benefits programs that give workers incentives and tools to keep themselves healthy, Sherman said.

Sherman sees the current lack of data on wellness and conditional management programs affecting his own organization: He is not yet working closely, on a day-to-day basis, with many group disability plan risk management teams, for example.

RightOpt is trying to improve the data situation by encouraging the exchange program vendors to provide comprehensive, detailed data in an easy-to-compare format.