Business Group Blog

Six Things to Watch in 2017

 

2017 will be a year of uncertainty, opportunity and change

 

Will ACA be repealed and replaced?

Brian Marcotte
Brian Marcotte, NBGH President & CEO 

Even though the public exchanges have been experiencing higher average premium increases and fewer insurance choices, a repeal of the ACA, even with a long transition period, could trigger a death spiral in the public exchanges as insurers exit to avoid being the “last man standing.” There are clearly elements of the ACA, however, that should be repealed, such as the excise tax on employer plans, the employer mandate and reporting and administrative requirements; all of these placed unnecessary burdens and costs on corporations who were already providing affordable, quality health care coverage for their employees. This is something the Business Group will be monitoring closely.

Will the move to value-based payments lose momentum?

Repeal of the ACA and changing (again) how consumers access health care without reforming how health care is delivered will not address the escalating cost of coverage or the long term affordability of health care for Americans. Trump’s choice of Rep Tom Price (R-GA) for Secretary of HHS raises questions about whether alternative payment models to the current fee-for-service system will remain a priority. Both the public and private sector need to step up the move to value-based payments in order to reach a tipping point that will transform health care delivery and remove the perverse financial incentives that drive up the cost of care without improving quality.

What will be the fate of proposed health plan mergers?

The Department of Justice will rule on the proposed Aetna/Humana and Anthem/Cigna mergers in 2017. The argument for the mergers is they will bring greater leverage to negotiate with health care providers, accelerate the move to alternative payment models and help reduce overall health care costs. The argument against the mergers is they will be too slow to change and will stifle innovation. Running under the radar is the rapid rate of provider consolidation. Regardless of health plan or provider consolidation, scale for the sake of scale will only result in higher costs. Scale that is leveraged to accelerate the movement to value-based purchasing, better care coordination and population health management, will be embraced.

Will pharmacy pricing remain in the spotlight?

We have seen high price increases across categories in pharmacy, including some generics and compounded medications as well as brand medications and especially specialty pharmaceuticals. Expenditures for specialty drugs are growing faster than any other component of health care spend. While specialty drugs are used by only 2% of the population, it is a top driver of total health care spend for most employers. The current pricing model for these drugs is antiquated, unsustainable and unaffordable and criticizing it has become popular among politicians and the public. Advancing risk-sharing and other value-based pricing models will be an area of focus in 2017.

Consumer engagement remains a top concern for employers

As much as we would like employees to become sophisticated consumers of health care, the delivery system is too complex and employees do not engage with enough frequency to ever become sophisticated consumers. Concierge, navigation and decision support services are stepping in to address this need. We see this as a growing trend in 2017.

Growing employer interest in workforce well-being

Investments in employee well-being, which encompasses emotional and financial well-being, social connectedness and job satisfaction in addition to physical health is beginning to be looked at by a growing number of companies as an integral part of a their global workforce strategy. Much like investments in training, development and safety, employee well-being can play an important role in deploying the most competitive, productive and efficient workforce possible.