In business, there are only so many levers you can pull to improve performance and influence culture. One of the most impactful moves is transforming
In business, there are only so many levers you can pull to improve performance and influence culture. One of the most impactful moves is transforming your healthcare plan, which can improve company savings while enhancing employee satisfaction.
I’ve helped lead this double win at a Fortune 500 public company. And it’s not a one-off success. As a member of a healthcare alliance, I’ve seen similar wins across many employers. For the 80 alliance members, combined healthcare spend totals a staggering $40 billion. By strategically transforming their plans, these employers are saving nearly $2 billion annually, while simultaneously improving the healthcare provided to employees and their families.
Here’s how you can achieve this too.
Strategy is Key
Changing your healthcare plan isn’t just about cost-cutting—it’s about strategy. My earlier articles explored why you should rethink your healthcare plan and how to understand the self-insured supply chain. This final piece outlines six essential strategies to implement your transformation successfully.
1. Put the Team Together
Healthcare transformation is a team sport. Start with your HR and benefits teams to represent employee needs, then include purchasing, finance, IT, and Legal. Together, create a shared vision and maintain regular updates with senior leadership.
Pro Tip: Structure this as a process team rather than a project team. If your organization is unionized, include union representatives. Giving everyone a seat at the table not only improves implementation but also builds trust and engagement.
2. Focus on the Fundamentals
Evaluate your healthcare supply chain from start to finish. Understand the organization as the payer and employees and their families as recipients. Track how money flows, where costs lie, and the motivations of each supply chain participant.
Tools like Porter’s Five Forces, SWOT analysis, and stakeholder mapping can uncover insights that directly impact your bottom line.
3. Dive Into the Data
Don’t let complex healthcare data intimidate you. Collect and analyze every aspect—from prescriptions and electronic health records to member experiences and fees.
Decide whether to insource analytics, outsource it, or use a hybrid approach. The key is consistency. Analytics inform every decision, revealing whether you’re getting value from every supply chain participant while improving employee health.
4. Evaluate Your Insurer / Carrier
Insurers (or carriers) manage networks, claims, and customer care—often controlling a large part of your spend. Review your contracts and issue an RFP to compare options. Even if you stay with your current provider, the process highlights opportunities for improvement and ensures you get the best value.
5. Assess Pharmaceutical Benefits Managers (PBMs)
PBMs bridge employees’ prescription needs and pharmaceutical manufacturers. They often represent both sides and get paid from both. Given that pharma can account for up to 30% of total healthcare spend, reviewing PBM contracts and exploring competitive options can yield significant savings.
Tip: Look into pass-through PBMs and analyze rebates for specialty drugs, such as GLP-1s, which can be extremely costly.
6. Engage Your Employees
Healthcare is personal and emotional. Employees’ perceptions of your plan reflect on your company culture—whether it feels caring and responsive or not.
Invite honest feedback and incorporate employee suggestions. Let them know when improvements are implemented. Engaged employees feel valued, which strengthens company culture and increases retention.
Why It’s Worth the Effort
Transforming a self-insured healthcare plan isn’t easy. It’s complex, involves multiple stakeholders, and requires detailed analysis. But the rewards are immense: a healthier workforce, a happier company culture, and measurable cost savings.
With strategic healthcare transformation, you can positively impact your bottom line while genuinely improving the lives of employees and their families.
COMMENTS