This post is part of our “Driving Transformation” series, in which Mercer consultants share key take-aways for employers from the 2016 Oliver Wyman Health Innovation Summit, a recent conference hosted by Mercer’s sibling firm, management consultant Oliver Wyman.
At many points throughout the conference, with its deep focus on a “consumer-led transformation” of health care, I was challenged to think about a fundamental element of such a transformation: consumer behavior change. Can we really teach healthcare consumerism skills? Can we instill a sense of shared accountability for health within a patient, who may have little or no financial “skin in the game”? And if we’re successful moving the needle on healthcare consumerism skills and sharing responsibility for prudent healthcare decisions, can these skills and responsibilities be called upon in the exceptional situations where healthcare is complex, emotional, and high risk? After all, these are the situations that account for the majority of healthcare costs.
It’s a tricky question, and we don’t think the answer is a simple binary yes or no.
We do believe that healthcare consumerism skills are teachable, in many (often lower cost) situations. With a growing number of employees and their families now covered in high-deductible health plans, healthcare consumers -- aka patients -- have significantly more financial responsibility than in the past. And, in fact, they are starting to use resources like cost/quality transparency tools, expert medical second opinion services, and plan design decision support. In situations where risk is relatively low or average, as it is about 80% of the time, we see solid evidence that the consumer can make prudent decisions. In the oft-used example of shopping for an MRI, users can review a list of reasonable alternatives and make a thoughtful choice that is responsive to various price points. Assuming they haven’t yet met the annual deductible, they are shopping for care and using dollars in their wallet (or HSA wallet) to pay, and are motivated to be a responsible purchaser of healthcare services. We’ve made tremendous progress in this area over the past five years and believe that the next generation coming into the workforce will only accelerate this type of consumerism.
But, what happens when care is complex, emotional, or a matter of life or death? In this scenario, as I recently asserted in an interview with the Associated Press, healthcare consumerism skills cease to matter. That’s partly because the healthcare market itself does not follow traditional economic principles. High quality does not equal high cost in healthcare – in fact, it’s often the complete opposite, since poor care leads to bad outcomes that require more care. And, just as important, rational consumer behavior does not apply in times of healthcare crisis, even for those who have mastered basic healthcare consumerism skills for routine, transactional healthcare decisions. The intrinsic motivation to shop wisely when spending personal dollars doesn’t apply either, since deductibles and out-of-pocket limits will be met.
What should the consumer care about in these situations? Quality. In fact, quality should matter most both to the consumer and to the plan sponsor. The trouble is that consumers don’t always know how to assess quality, how to reconcile competing quality measures, or how to decipher even basic quality information. The reality is that care coordination in these high-cost complex episodes is often fully directed by a provider or care team, with little room for the consumer to intervene and try to steer decisions. Given this dynamic, plan sponsors are uniquely positioned to play a role since the traditional expectations of consumer behaviors cannot be called upon. Strategies for plan sponsors include using quality networks, offering care coordination support, and enhancing case management. Since intrinsic motivation to be a prudent healthcare cost shopper doesn’t apply in the most costly situations, plan sponsors can create an environment where only “good options” are available to the consumer. With this in mind, Mercer believes that a consumer-led healthcare transformation requires alignment and support provided by the critical partner of plan sponsor.