70% of Employers Offer Packaged Health, Dental, Pharmacy Benefits

February 21, 2019 - Seventy-one percent of employers with 100 or more employees are either actively integrating or considering integrating their medical, dental, vision, and pharmacy benefits under their health and wellness programs in the next five years, according to a study commissioned by Anthem and conducted by TRC Insights.

Employee benefits are often siloed, the study authors noted, with medical, pharmacy, dental, vision, and other benefits offered through multiple carriers that often don’t interact. This can lead employers and providers to have a disconnected view of overall physical health, as well as their spending on different services.

Integrating benefits allows payers to share data with employers, so that employers can help guide employees to prevention strategies and care management programs.

“It’s clear that the impacts of employee health and benefits extend beyond the medical care costs,” said Nick Brecker, President of Anthem’s Specialty Business.

“Employees and employers are looking for solutions that connect medical care with pharmacy, dental, vision, disability and other benefits programs, so that employees can get the support they need to improve their overall wellbeing, satisfaction and productivity.”

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To understand how employers are progressing with integrated healthcare, researchers conducted interviews with national, large, and small group employers.

National employers were defined as those operating in two or more states, while large employers were those with 100 or more employees operating in one state. Small employer groups were those with less than 100 employees.

The results showed that most employers are increasingly moving toward integrated benefits. More than half of large group employers reported that they are actively integrating their benefit packages, and 25 percent said they are considering it.

This is a significant increase from the 2016 version of the survey, when just 60 percent of employers were making moves towards creating more comprehensive benefit offerings.

National and large employer groups continue to lead the way with integration, the study found, with nearly half of interviewed national employers reporting that they are actively integrating their benefits.  Thirty-six percent of interviewed large groups said the same.

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Dental and vision benefits are most likely to join traditional clinical care benefits, employers said. Sixty-nine percent said they were actively integrating vision, while 67 percent reported they were actively integrating dental.

Pharmacy and disability followed, with 65 percent saying they were actively integrating pharmacy into their medical benefits and 51 percent saying they were integrating disability.

While ease of administration and lower costs are still prominent motivations for integrating health benefits, employers’ reasons for integrated healthcare are beginning to change.

“There’s a noteworthy shift in employers’ mindsets,” the researchers said. “In previous years, companies that integrated were generally focused on the financial potential. Now they’re turning to integration not just for savings, but for happier workers.”

Eighty-eight percent of employers believe that integrated benefits make companies a place where people want to work, and 87 percent of respondents think employees who receive multiple benefits under a single insurer are healthier in the long run.

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Additionally, researchers found that a growing number of employers don’t evaluate the success of their integrated health benefits programs by any standard measure, and reported that they implement these programs simply because it’s the right thing to do.

While this group accounts for a smaller percentage of employers (19 percent), the team pointed out that it is more than double the eight percent of employers who said the same in the 2016 survey.

Organizations also understand that offering integrated health benefits is essential to compete with other employers.

“Acknowledging that acquisition and retention of talent is essential, the consensus among employers in the national and large group sectors is that they have to offer more integrated health care to compete. Many in small groups share the view, but it isn’t quite as prevalent,” the researchers wrote.

Eighty-two percent of employers in the national sector and 86 percent in the large group category recognize that offering more strongly integrated benefits will help them compete with other employers, while just 65 percent in the small sector said the same.

The results demonstrate that integration is growing more common among employers as they increasingly recognize the benefits of integration for their employees.

“I’m encouraged that more and more employers are adopting this approach,” said Brecker. “By addressing ‘whole person health’ we can identify and communicate opportunities to positively impact employees’ health, provide them with a simplified experience and lower their health care costs.”

Going forward, employers will need to evaluate the needs of their employees and aim to meet those needs as best as they can.

“As integration has gained momentum, the need for innovation has become even more critical,” the researchers concluded.

“Employers need to look at what matters to their employees and what makes sense for their organization — and select products accordingly. With disability currently lagging behind pharmacy, vision and dental, for example, there is an opportunity to take advantage of this untapped potential in integrated healthcare offerings.”