The word navigator conjures up an image of an expert guide who ensures our safety on stormy seas.
If you have ever waded into the U.S. healthcare system or selected a benefit plan, you likely wished you had one at your side. It doesn’t take much to feel as if you are in over your head.
The Affordable Care Act contains a provision for navigators to act as the beacon for consumers during the eligibility and enrollment process in state-based insurance exchanges, i.e., competitive marketplaces. Proposed regulations establishing standards that will apply to navigator roles were released last month by the Department of Health and Human Services.
Beginning Oct. 1, individuals and small businesses are scheduled to be able to purchase private health insurance from state exchanges, with coverage effective Jan. 1, 2014. Although a delay in rollout has been reported, a Small Business Health Options Program exchange will help employers compare health plans and enroll their employees.
But what about companies with more than 100 employees that may be participating in corporate exchanges?
We are about to experience a seismic shift from an employer-driven payer model to a consumer-directed model in which employees will be making the choices. Based on what I heard in the past few weeks at three consecutive national conferences where healthcare reform was the topic du jour, the burden for educating employees about their health plan choices will largely fall on the shoulders of employers and their insurance partners.
At the annual Risk and Insurance Management Society conference last month in Los Angeles, I asked Matt Stover, an industry expert and managing director at the Boston Consulting Group, about the state of consumer readiness for exchanges. His response: “Fabulously unprepared. There is a huge disconnect between services and needs, and employers are at the nexus.” Consequently, they are scrambling to find ways to close the gaps.
Stover said new models that are likely to emerge will feature a combination of channels including traditional enrollment practices, one-on-one coaching, call centers, online activities and other “tools employers need to engage employees in the single enrollment event” and across the entire benefits landscape.
I’m particularly encouraged to learn that these new models may be used to improve the overall health of working populations.
However, many challenges lie ahead as we experience this sea change. Employers will need to have a firm grasp on the economic and legal impacts of public and private exchanges in comparison to traditional health benefit plans while heightening their awareness of employee preferences. In the insurance industry, experts say larger companies must figure out how to manage the sell-through process to employees who will be making the choices. With respect to smaller companies, the challenge for insurers and brokers is how to scale offerings to meet the needs of smaller populations.
Here are a few other reasons why we should care:
- A study published in Health Affairs on Massachusetts’ experience confirms that consumers need help navigating exchanges.
- In another study, less than one-in-five patients in a high-deductible consumer-directed health plan were unaware of their eligibility for free or low-cost preventive care. As a result, they delayed or did not have preventive office visit, test or screening because of the cost.
- Surveys repeatedly show that many employees rely on their employer as a trusted adviser in benefits planning and selection.
- Research in behavioral economics and decision psychology suggests that giving people more choices paradoxically causes them to make poor decisions. (Refer to the Paradox of Choice: Why More is Less by Barry Schwartz.)
For employers, the corporate exchange model creates the potential for improved cost predictability, lower overhead from elimination of vendor management, and a greater focus on employee health and productivity through redeployment of human resources functions. For employees, it represents the promise of a superior user experience.
A recent Booz & Company survey of more than 500 employers and 300 consumers validates the expectation that interest in corporate exchanges will grow as state exchanges come on line. (The findings are analyzed in a paper on the Emergence of Private Health Insurance Exchanges.) Meanwhile, in a Corporate Healthcare Exchange Survey of 562 companies, AON Hewitt found:
- More than two-thirds of respondents lack a formal health care strategy, but 94 percent remain committed to offering and financially supporting health benefit coverage in some manner.
- 77 percent currently offer health plans with limited choices and pay a percentage of the cost.
- 44 percent say a corporate exchange will be the preferred approach to providing healthcare in the next three to five years, a significant increase from the current market of only 4 percent.
We all need to become better educated healthcare consumers. It starts with caring about our own health and the well-being of the workforce, whatever our role in the delivery system.
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