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The One Percent Strategy: Lessons Learned From Best Performers
Executive Summary
Despite a two percentage-point drop from 2006 to 2007, health care costs are increasing at twice the rate of inflation. Thus, more employers are turning to consumer-oriented health care models to help them control costs and improve employee health and productivity. These companies are getting results by combining consumer-directed health plans (CDHPs) with a broad range of programs designed to more actively engage employees and provide them with the services, tools and information needed to make more informed health care decisions.
The 13th Annual National Business Group on Health/Watson Wyatt study details current trends and best practices in employer-sponsored health care benefit programs.
Key findings include:
- Best-performing companies have a two-year median cost increase of 1 percent, compared with 10 percent for their poor-performing peers. The median two-year increase for all employers is 6.2 percent.
- Companies with a CDHP report a two-year average cost trend that is significantly below that of companies without a CDHP (5.5 percent vs. 7.0 percent). Enrollment rates in CDHPs are also strongly linked to lower health care cost trends. Companies with at least 50 percent of their population enrolled in a CDHP have a two-year trend about half that of non-CDHP sponsors.
- Both CDHP adoption and enrollment rates are increasing. Forty-seven percent of companies now have a CDHP in place – an increase of more than 20 percent compared with 2007. Forty-two percent of these companies have at least 20 percent of their employees enrolled in a CDHP, up from 27 percent of surveyed companies in 2006.
- Best performers and those with consumer-oriented health care models are achieving significant cost savings by implementing programs that use financial incentives; focus on provider quality, data, health and productivity; and provide employees with information to make smarter health care decisions.
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