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Just five conditions — cancer, musculoskeletal, cardiovascular, gastrointestinal and neurological — account for 50% of healthcare spending, according to a study conducted by UnitedHealthcare and Health Action Council.
The fifth annual joint white paper, “Costly conditions: Identifying and addressing top clinical cost drivers,” analyzed national data from more than 320,000 covered lives within the membership of HAC, a nonprofit coalition based in Independence that represents midsize to large employers across the country. Roughly half of those employees and family members had claims for at least one of the five conditions.
Employers looking at their annual data often know that they have a group of high-cost claimants, but if they don’t know why or what specific condition is driving those trends, they don’t know how to best address those costs, said Patty Starr, president and CEO of HAC. The study aimed to identify demographic or regional trends, “so that employers could actually make better decisions moving forward, and may also change the benefit structure,” she said.
The white paper found that cancer accounted for 15% of costs, with chemotherapy being the primary driver within that category. Musculoskeletal claims were the second-largest portion, at 13%, followed by cardiovascular (9%), gastrointestinal (7%) and neurological (6%).
Through wellness programs and plan design, employers have typically spent a lot time focusing on addressing the high costs of cancer, musculoskeletal and cardiovascular claims, which are conditions people generally understand and are familiar with, said Craig Kurtzweil, vice president of the Center for Advanced Analytics at UnitedHealthcare.
In focusing on those conditions, other areas that drive costs and “might be ripe for more impact” can be forgotten, he said, so it’s important to broaden the perspective to different health topics.
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“A lot of employers have spent a lot of time strategizing around the right cancer program, or a way to prevent heart disease, the right way to think about alternative forms of treatment for back pain, things like that — it’s just been around so long that everyone’s kind of thought about it and strategized around it,” Kurtzweil said, adding that those efforts are still crucial. “But I can tell you very rarely has an employer thought about a gastrointestinal health program to really focus on.”
And though some conditions may not be as prevalent, they’re growing and have other implications. For instance, neurological and gastrointestinal issues affect not only health costs, but also productivity, he said.
“It’s really hard for some of these conditions for employees to be productive and live a normal life kind of working and going through some of these things,” Kurtzweil said. “So if you add the productivity, presenteeism to the healthcare costs, some of these topics should be making headlines (but) just haven’t so far.”
The white paper offers suggestions for employers to help control costs, including employee engagement and increased transparency.
With employees staying in the workforce longer, it’s important to be mindful of the normal aging process, Starr said.
“As employers, we have a population that is aging,” she said. “There’s new awareness points from when diseases onset. There may be more cognitive or psychological changes, or social or environmental changes that are occurring on a regular basis than what we had seen in the workplace up to this point.”
Wellness programming and other initiatives in the office need to recognize that and perhaps be tailored to different populations within a workforce, Starr said.
Other cost control suggestions she highlights are including elements of cardiovascular health to all wellness and engagement programs and, given technological advances, adding genetic testing to plans when clinically appropriate for employees to receive access to necessary resources and potentially eliminate waste in the system.
Another possible measure for employers with broader geographic footprints is examining practice patterns by geography to see if there are differences in costs, adoption of best practices or under/over-treating. To address such differences, the study suggests options such as offering referral incentives, adding regional Centers of Excellence to plans and working with a third-party administrator to conduct provider outreach to improve quality of care.
“I think that one of the key elements, from a benefit standpoint, that we all have to recognize is where your employees live not only affects their health, it also affects the provider billing patterns, and employer spend for these conditions,” Starr said. “So I kind of think that premise is a nice reset when you start looking at the benefits structures.”
This story first appeared in our sister publication, Crain’s Cleveland Business.
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