A recent study in Health Affairs compared individual plans to employer-sponsored plans in terms of scope of benefits, cost-sharing provisions, premiums, expected out-of-pocket costs, and actuarial value. But while premiums in an individual plan may be attractive for those who are young and healthy, with some plans offering guaranteed renewal without risk-rating, most Americans find employer-sponsored plans a much more attractive alternative.

Employer group plans cover 90 percent of the nonelderly population with private insurance, while individually purchased health insurance covers only 10 percent.

Roland McDevitt, PhD, director of health care research at Watson Towers (the combination of Watson Wyatt and Towers Perrin) and lead author, says the researchers set out to “quantify the difference in the plans in the individual and group market. We wanted to be a little more systematic in comparing the value of the plans from the perspective of a single adult.”

The data suggest that for a young, healthy adult, individual insurance might be attractive in terms of premium. But McDevitt points out that “a lot of people with individual market coverage don’t have coverage that’s as comprehensive as employer-based insurance. Individuals are faced with higher out-of-pocket costs, and there are more health conditions that might not be covered — for example, maternity, mental health services, or pre-existing conditions.”

McDevitt says employer-based coverage “is a benefit to the employee and to the employer. Employers gain an advantage as a result of tax policies and the employee sees he is only paying a $693 premium — albeit offset by wage adjustments.”

*Does not include employer contribution to premium
Source: Adapted from R. McDevitt, et al., “Group insurance: A better deal for most people than individual plans,” Health Affairs; 2010:29(1)156–164.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.