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The Future of Employer Based Health Care

The Future of Employer Based Health Care Midwest Business Group on Health May 10-11, 2007 A Fine Mess We’ve Got Ourselves Into Purchasers Not Buying Right Plans Not Letting Provider Value Show Through Providers Not Seeing Business Case for Reengineering

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The Future of Employer Based Health Care

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  1. The Future of Employer Based Health Care Midwest Business Group on Health May 10-11, 2007

  2. A Fine Mess We’ve Got Ourselves Into • Purchasers Not Buying Right • Plans Not Letting Provider Value Show Through • Providers Not Seeing Business Case for Reengineering • Patients Not In the Quality Game

  3. Competitive Disadvantage for EmployersHealth Care Spending As Proportion of GDP Among US Major Trading Partners, 2003 Source: OECD

  4. Competitive Disadvantage for Workers

  5. Big Bucks – No Bang

  6. Cadillac Prices, Yugo Quality… • Condition% Receiving Recommended • Care* • Breast cancer 76% • Heart attack & coronary artery disease 68% • Immunizations 66% • High blood pressure 65% • Asthma 53% • Diabetes 45% • Urinary tract infection 41% • Sexually transmitted diseases 37% • *McGlynn, et. al, New England Journal of Medicine, 2003

  7. Injury to Insult • 44,000-98,000 plus deaths from errors during hospitalizations • 7,000 deaths from medication errors alone • Ambulatory unknown • Source: Institute of Medicine

  8. Consumer Disconnect From CostSource of Private Health Care Expenditures As Share of National Total Source: Office of the Actuary, Centers for Medicare & Medicaid Services

  9. American’s Aren’t Paying the Bill – and They’re Still Not Happy Source: Harris Interactive Poll

  10. And the American Public is Losing Patience… Source: Harris Interactive Poll

  11. An Information Technology Wasteland • Average spent per worker on IT in health care – $1,000 per worker • Average spent per worker on IT in other industries – $8,000 • Source: Department of Health and Human Services

  12. IT Proliferation on a Slow TrackElectronic Health Records Adoption Curve Time to Move From 10% to 80% Adoption • VCRs – 7 Years • E-mail – 11 years • Home PC - > 15 Years Bush goal of 100% by 2014 Source: The RAND Corporation

  13. Medium and Small Employers Bail OutFirms With 3-199 Employees Offering Health Benefits Source: Kaiser Family Foundation, Employer Health Benefits, 2005

  14. Increasing Pressure on Public SystemMedicare Spending Components As Proportion of GDP Source: Medicare Trustee’s Report, 2005

  15. Employer Responses • Managed care • Cost shifting • Consumer directed health plans • Transparency and P4P • Drop coverage

  16. Where Do We Go From Here?

  17. Do you believe the current system can be sustained?

  18. CHRO View • 81% System cannot be sustained

  19. Do you believe the current employment-based system should be strengthened and maintained?

  20. CHRO View • 46.8% System of employment based • coverage should be strengthened • and sustained

  21. It’s Time to Get Our House in Order…

  22. CHRO View

  23. Transparency a Priority • Require plans and providers to publicly report quality and cost

  24. So is Pay-for-Performance • Require plans and providers to publicly report quality and cost

  25. Steve Wetzell Executive Vice President, Health Care Initiatives (202) 789-7636 swetzell@healthcareRT.org

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