Employers are finding new ways to cut healthcare costs

Employers are finding new ways to cut healthcare costs

A growing number of companies are contracting directly with hospitals and healthcare providers.

According to a survey published this week by the National Business Group on Health, a growing number of companies are contracting directly with hospitals and providers to deliver healthcare to their employees.

Some 11% of large companies said they would do this in 2019, up 3% from this year.

General Motors and Henry Ford Health System announced such a move on Monday. Through GM’s new “ConnectedCare” option plan, a six-hospital system will provide access to more than 3,000 primary care and specialty doctors, as well as hospital, emergency room and pharmacy services.

Nearly 24,000 salaried workers in Southeast Michigan, where the company is based, will be able to choose this policy starting from next year.

The agreement signed by GM also provides wellness exams, chronic care monitoring and preventative screenings, as well as prompt appointments with providers and virtual visit options.

“GM’s upcoming ConnectedCare option comes from our ongoing quest to improve employee health, while also seeking to offset rising health care costs for both the employee and the company,” said Sheila Savageau, US healthcare leader at GM.

The survey results and the announcement by GM come amid a new trend in which direct contracts between companies and providers to handle expensive forms of treatment, such as those for cancer, cardiovascular disease, and orthopedic needs, are becoming more popular.

Employers are also providing more virtual care options for their workforce, with half saying this is their top health care initiative for 2019, according to the survey.

Along with telemedicine, virtual care also encompasses apps that provide digital coaching, chronic condition management and remote monitoring. A number of companies are likewise providing access to virtual physical therapy and psychological care.

The key goal is to reduce costs. According to the National Business Group on Health survey, employers project the total bill for providing medical and pharmacy benefits next year will rise 5% for the sixth consecutive year to an average of $14,800. Currently, companies cover roughly 70% of that cost.

“No longer able to rely on traditional cost sharing techniques to manage costs, a growing number of employers are taking an activist role in shaking up how care is delivered and paid for,” Brain Marcotte, CEO of the National Business Group on Health, told CNN.


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Paul Imison
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