Feb 25, 2022 - Health

Companies don't agree on health coverage reforms

Illustration of three briefcases getting progressively larger
Illustration: Aïda Amer/Axios

Employers support reforming how workplace health care is paid for and covered, but various coalitions don't agree on the details or how significant changes would actually be.

What they're saying: "None of us are going to say that this is a perfect system. There's a lot of frustration," said Jim Klein, CEO of the American Benefits Council, a lobbying group that advocates for corporate health benefits. "But compared to any alternatives, this system has earned a lot of trust."

The big picture: For more than a decade, employers have rallied around "value-based care" — a vague term associated with tying payments to the quality and cost of the health services provided instead of the volume of their services.

  • This includes options like medical tourism, where companies pay for their workers to travel for certain procedures at specified hospitals that have lower prices and high-quality scores.
  • "To completely ignore outcomes and to pay amounts that are vastly different regardless of outcomes is clearly a system that isn't right," Klein said.

The intrigue: Corporate America also strongly backs a bipartisan bill in Congress that would crack down on anticompetitive contracts between hospitals and insurers.

  • The Biden administration also has expressed concern over how anticompetitive behavior in health markets can drive up the cost of care.

A paradox: The Benefits Council and other employer groups have pushed lawmakers to include employers in any proposals that involve Medicare drug inflation rebates.

  • So, why not lobby for employers to get federal inflation rebates from rising hospital and doctor prices?
  • "That's a really good one," Klein said before pausing. "That's where those Medicare rates are perhaps so low that providers are looking to the private sector for the revenue to sustain the system." (Again, that's not really a thing.)

The bottom line: If employers want to come out of the pandemic with an improved system of covering care for their workers, experts say they'll have to look beyond small-bore projects and buzzwords.

  • "Most value-based programs have had little to no meaningful association with changes in cost, quality or wasteful spending," health policy experts wrote in JAMA in 2019 and echoed in discussions this past summer.
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