I am speaking at the HLTH conference in Boston today on a panel titled, “The New Shape of Work.” The goal of the session is to reevaluate and rethink the traditional health benefits we see from employers given the major societal shifts of the last 18 months. Employees are demanding more options, more and varied types of coverage, better care delivery options in general, and more mental health support specifically. I will be sharing perspectives alongside Christine Brenner (SVP Total Rewards) from Mastercard and Raj Singh (Chief Executive Officer) from Accolade. Given the panel style format, I thought I would also include some expanded thoughts in this post.
I have been really intrigued by how the pandemic has accelerated fundamental shifts that were already underway—in all aspects of society. While I comment mostly on healthcare given our work at Crossover, I have been curiously following many of the trends that are tangential but related to our “magnificent obsession.” I’ve previously noted the changing patterns of working in a physical office, and the positive and negative impacts it is having on commercial real estate within our cities. This has manifested not only in hollowed-out business districts but also in skyrocketing suburban and rural real estate, as people realize that geographic proximity is often not essential. The smartest companies are exploring new models of “hybrid work,” structured remote work, eliminating “headquarter” locations, and other more sophisticated approaches that depart from the previous binary choice of working from home or working in the office. The notion of work-life “balance” seems to have morphed into a more blurred work-life “blend.”
While employers are sorting through this, consumer patterns seem to be simultaneously changing in multiple directions as well. The pandemic pushed online sales through the stratosphere, but ironically, the largest retailers (like Amazon) are planning to open even more physical locations. However, many of these will be the new micro-fulfillment centers that are much smaller, more focused, and provide for important “in-person” experiences that enhance the relationship to the overall brand. This trend started with the logistical improvement of better meeting “in market” movement of goods and timely deliveries, but retailers are quickly applying the lessons learned and new possibilities from their equivalent of “ghost kitchens”. In-person shopping isn’t going away, but it is certainly being restructured.
So, what’s going on here? It’s not that we are backtracking from digital: it’s far too embedded (and valuable) in our lives for the adoption trend to reverse. However, the digital transformation is causing a pause in how people think about the choices they’re making in how they work, shop, and interact. It’s the New Shape of Choice. Companies that embrace the agility required to anticipate, and then meet, the new choice patterns of employees, users, and customers will be the big beneficiaries in the Big Reset.
Here are five questions we see benefits leaders wrestling through as they respond to the New Shape of Choice in designing health benefits for their employees:
- What should our role be as an employer in offering health benefits, anyway? As employers have had to reluctantly wade into large social and public health issues, many have begun to question the overall role of employer-based benefits—why should where you work impact your access to healthcare? We are also gaining a better understanding of how the environment in which you live, work, and play is material to your underlying health. For the most part, and to their credit, I have NOT seen employers shy away from their responsibility to provide meaningful benefits to their employees. In fact, I have seen recent investments in health actuaries, better and more expansive coverages, and efforts to get to the root cause of good health and create incentives to follow that path. For now, the commitment to health, awareness of the determinants of health, and a focus on health equity among employers have only increased.
- How can our health benefits contribute to the overall strategy of the company? As employers recommit to maintaining health benefits, they quickly come to realize how differentiating they can be to recruiting, hiring, and retaining top talent. Historically, certain employers could leverage their campus amenities as a differentiator, but remote work has neutralized this. Furthermore, campuses were highly effective in reinforcing culture, togetherness, collaboration, and serendipitous chance encounters. With no watercooler, no gym, and no cafeteria to rely on, employers are turning to digitally-enabled benefits to recreate the cultural touchpoints necessary to build cohesive, high-performing teams. Coordinated, integrated, and coherent health benefits strategies can both reduce the stress of modern work life and augment the cultural aspects of company building including the sense that company cares and is making investments in its employees. Smart employers understand this and overinvest in simple, easy, and impactful benefit offerings that quickly become strategic imperatives for competitive companies.
- What health benefit priorities matter most to us now? This is more understood and well-documented than ever before. We are having a crisis of mental health, in terms of isolation, as well as general anxiety and depression about the future. In order to ensure productivity, and the retention of top talent, employers are turning to benefits that are focused on modern mental health and foundational primary care but that can also address high spend areas and the needs of specific populations. Finally, having the ability to navigate employees to internal benefits programs (affinity groups, interest areas, and skill building) as well as external secondary care resources (specialist referrals, outpatient centers, diagnostic facilities, etc.) seem to be the core investment areas that matter the most to most employers.
- How should we organize these priorities into a coherent strategy that simultaneously addresses our cost, quality, and outcomes concerns? We have written about this extensively. We see the New Shape of Choice influencing benefits along a four-part strategy of engagement, care, payment, and outcomes. These are not only logical, but sequential steps that any employer can take to fundamentally redesign their benefits. Great Engagement is required to ensure employees are aware of and can utilize the services and interventions available. The Care Delivery model cannot be transactional; rather, it must be relationship-based, connected to the member, delivered through multiple channels based on member preferences, and ultimately, be accountable to outcomes. Furthermore, a primary objective of Primary Health must be to get employees the right Secondary Care when needed by embedding Care Navigation into the care delivery itself. This is not just a cost containment strategy—but more importantly, it creates tremendous member satisfaction to be supported when referred into the costly and complex Secondary Care network. Care Navigators can also be force multipliers by referring to other value-added internal programs and partners. When members voluntarily opt into a Benefits Plan (with its embedded Payment model) specifically mapped to care, you get a multiplier effect and synergies on both sides of the care relationship. Better Primary Health prevention, care, and chronic disease management, when coupled with curated referrals into the Secondary Care network and tied to a self-reinforcing benefits design, will result in lower costs. Because of the natural alignment and incentives, it will also lead to documentable higher quality, better experience, and provider engagement which are the elusive Outcomes everyone is seeking. It seems so simple, straightforward, and obvious; but, as demonstrated by those currently adopting these advanced strategies, still very early.
- So, what are the best practices we can implement to become a “Health Activist” Employer? This is a more self-reflective question for benefits leaders to ensure they are prepared for the journey ahead. Not everyone is ready for a fundamental restructuring of their benefits approach. The term “Health Activist” best describes a specific type of employer who is:
- Ready, willing, and able to move through all the inertia, resistance, and status quo to make these critical changes;
- Architecting out benefits that are simple, coordinated, and meaningful but still allow for the choice and flexibility demanded by the modern worker;
- Reducing the point solution buffet (see Cheesecake Factory menu) to the few solutions that actually move the needle (see In-N-Out menu) like foundational Primary Health;
- Willing to read, study, and research the drivers of healthcare costs (and who understands you can’t control healthcare costs without managing healthcare delivery);
- Has the rare combination of insight, awareness, aptitude, experience, and ability to run through brick walls repeatedly to design a benefits program that can literally achieve the elusive quadruple aim;
If you can answer yes to the above, then you are ready to proceed with the quest!
In the new world order, health benefits offered by employers will be required to do more work as part of the strategic value proposition of every company. Coasting by with annual incrementalism in benefit design will only cause more unmet employee needs, less job satisfaction, and higher attrition in a world full of lower barriers to transition and higher bar for retention. The more innovative benefits leaders will do the hard work required while simultaneously finding their roles suddenly much more strategic, more essential, and more vital to the success of their companies.
There are shining lights out there, great case studies who have forged ahead (we get to work with many of them) with the approaches described above, and the drum beat for change will continue to be the clarion call for more benefits leaders with the courage to address the New Shape of Choice.