More Employers Make Health Program Changes to Control Costs

February 22, 2010 (PLANSPONSOR.com) - A growing number of large U.S. employers are taking more aggressive measures to control rising health care costs and motivate workers to take charge of their own health, according to a survey conducted by Towers Watson and the National Business Group on Health (NBGH).

According to a press release, the survey found that 83% of companies have already revamped or expect to revamp their health care strategy within the next two years to control costs, up from 59% in 2009. Costs are expected to increase 6.5% this year, down slightly from 7% in 2009, Towers Watson said.

Two-thirds (67%) of employers identify employees’ poor health habits as a top challenge to maintaining affordable benefit coverage. More than half (58%) indicate the biggest obstacle to changing employees’ health-related behavior is the lack of employee engagement, followed by lack of sufficient financial incentives to encourage participation (31%) and lack of an adequate health management program budget (30%).

The survey found that to address this, employers are increasingly adopting programs to help employees change their behavior and become more informed health care consumers. In 2010, more employers (66%) plan to offer incentives for employees to complete a health risk appraisal, up from 61% in 2009. Also, 56% of employers now offer health coaches, and more than one-quarter (26%) now offer onsite health centers. 

Employers also recognize there is considerable room for improvement with regard to medical vendor program delivery, the press release said. Two-thirds (67%) of companies say that vendors fall short with programs designed to change member behavior to drive more efficient use of health care services, and 66% indicate vendor programs designed to change member behavior related to making healthy lifestyle decisions are not at all or only slightly effective. Fifty-seven percent of employers also consider vendors not at all or only slightly effective at driving care to high-quality providers. 

The 15th Annual National Business Group on Health/Towers Watson Employer Survey on Purchasing Value in Health Care was conducted from November 2009 through January 2010 with 507 employers of 1,000 or more employees that collectively employ 11.5 million workers. The full report will be available in March.

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