Reducing Health Care Costs With Improved Plan Efficiency and Employee Wellbeing

Rising Healthcare Costs

According to the Willis Towers Watson 23rd Annual Best Practices in Health Care Employer Survey, total health care costs are expected to rise by about 5% in 2019 for both employers and employees. In addition, the Willis Towers Watson Financial Benchmark Survey found that the average cost of healthcare per employee in 2018 was $12,612, which will translate to an estimated $13,243 per employee for 2019. Since employees contribute an average of 24% of total premium costs, last year’s average employee contribution of $3,027 could rise to $3,178 in 2019. These numbers understandably raise concern about affordability, which is why controlling health care costs and improving plan efficiency are a top priority for employers.

Key Strategies for Improved Plan Efficiency

The Best Practices in Health Care Employer Survey found that employers have specific strategies for improving the efficiency of their health care plans, including:

1. Managing cost and utilization of pharmacy benefits, particularly specialty pharmacy: Employers are working to reevaluate their pharmacy benefit contract terms, promote generic drugs and the use of biosimilars whenever available, implement coverage changes to influence site of care for specialty pharmacy, and address opioid use.
2. Encouraging the use of high-quality health care delivery channels: Where employees receive care can have a dramatic impact on costs, so employers are encouraging them to use value-based services such as telemedicine, centers of excellence, expert medical opinion programs, and high-performance networks.
3. Ensuring vendors and carriers are aligned with cost and health improvement goals: For optimal plan efficiency, employers need vendors that support their cost and health improvement goals. After choosing supportive vendors, employers are formally monitoring vendor performance through performance guarantees and also requiring vendors to share data for employee referrals and integrated reporting.

Additional Top Priorities

In addition to improving the efficiency of health care plans, the Best Practices in Health Care Employer Survey found that employers also have top priorities relating to employees’ health outcomes and health experiences. They include:

1. Improving Clinical Conditions: 85% of employers listed improving these six clinical conditions as their top priority: Metabolic syndrome/Diabetes, Musculoskeletal disease, mental/behavioral health, cardiovascular disease, cancer, and maternity/Infertility.
2. Employee Well-Being: Employers are very committed to improving employee well-being with 82% of employers reporting it as a top priority for the next three years. Employers are focused on enhancing total well-being through initiatives that support physical, emotional, financial and social well-being.
3. Employee Experience: To improve the overall employee experience, employers are offering more choice when it comes to their benefits. They are including voluntary benefits as well as the option to customize plans to an employee’s exact needs. In addition, employers are utilizing technology, such as health applications, to further enhance the experience and increase engagement.
4. Healthy Work Environment: Employers are extremely dedicated to creating a workplace culture that supports all aspects of a healthy lifestyle. Employers note the importance of all management levels supporting and participating in the healthy work environment.

For more information, download the full Willis Towers Watson 23rd Annual Best Practices in Health Care Employer Survey here!


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