Employers that offer health insurance increasingly are moving to a "pay for performance" approach, according to a new survey that puts a similar move in the FEHB in the context of what is happening in the overall health insurance market.
FEHB for several years has been encouraging carriers to offer financial incentives to enrollees to participate in health risk management programs such as certain screenings and managing factors associated with higher costs, such as obesity. The most recent "call letter" to carriers, outlining expectations for 2014, said that participation in such programs remains relatively low in the FEHB population and it encouraged carriers to step up their efforts, including by creating greater financial incentives for enrollees to participate.
Meanwhile, the Aon Hewitt consulting firm has released findings of a survey of private sector employers that offer health insurance—many others don’t offer it at all to their employees—finding that they are increasingly migrating to what it called a "house money/house rules" approach.
Said the report: "Under this model, employers may reserve a portion of their health care dollars for those employees who exhibit good health behaviors or who can show measurable progress toward their health goals. For example, participants who take health risk questionnaires and biometric screenings may be rewarded in the form of lower premiums or access to broader health coverage. Other employers may waive prescription drug co-pays if an employee demonstrates they are following their doctor’s orders with regard to a chronic condition. Lastly, some leading-edge employers are working with health plans to incentivize participants to use a small provider network of high quality, cost-efficient providers."
The report meanwhile projected health care costs for both employers and enrollees to rise about 8-9 percent on average in the years ahead, largely due to "worsening population health issues, including obesity, smoking and failure to comply with medications."
It further found that 6 percent of employers currently offering health insurance to their employees may drop that benefit in the next three to five years.
