How open enrollment for individual coverage affects employer-based plans: Willis Towers Watson Q&A

The 2018 open enrollment period for individuals purchasing health plans on the ACA's marketplaces begins Nov. 1. While the Kaiser Family Foundation states 49 percent of Americans get health insurance through their employers and 7 percent buy coverage on their own, open enrollment still plays a role in employer-based plans.

Amy Hollis, national leader of voluntary benefits at Willis Towers Watson, and Cameron Congdon, North American health and benefits leader of Willis Towers Watson, answered Becker's Hospital Review's questions about employer-based health plans and how open enrollment on the individual marketplace affects employees' health plan choice.

Note: Responses have been lightly edited for length and clarity.

Question: What are the biggest challenges employees face when enrolling in coverage through their employer?

Amy Hollis and Cameron Congdon: The question we are getting most often is, "How should employers guide employees in making choices for 2018?"

Employees have more choice in health plans and in voluntary benefits than ever before. That is a good thing because employees have the chance to assemble plan options that best meet their needs. On the other hand, more choice can cause more confusion.

Employers have long offered support and advice to employees when signing up for benefits. These have typically taken the form of live human help via the telephone. More recently, employers have turned to technology to offer online help.

One example of advanced online help, available through the Willis Towers Watson private group marketplace for employers, is a recommendation engine. This helps employees make informed decisions with the right support.

With or without advanced decision support, employees are best served by first determining their needs, and second picking benefits that meet their needs, rather than picking their core plan first and hoping it meets their needs. However, employers that guide that process for employees will likely help employees make better decisions for 2018 enrollment.

Q: How will enrollment on the individual marketplaces affect employer-based plans?

CC: The ACA's structuring of an effective individual market has led to some underappreciated benefits for employers. The contingent workforce, as well as those in the "gig" economy — or those taking short-term or freelance work commitments — are able to purchase individual insurance, reducing pressure on employers to directly employ these workers.

In addition, retirees under the age of 65 can now purchase benefits on the individual market, whether they are subsidized by employers or not. This helps people interested in retiring before they are eligible for Medicare fulfill their dream and saves money for employers.

Q: In 2017, roughly 1 in 4 employees purchased a policy sporting a deductible of at least $3,000, according to Kaiser Family Foundation's 2017 Employer Health Benefits Survey. In addition to these high-deductible health plans, what other trends are you seeing in the employer-based health plan market?

AH: Based on the results of the Willis Towers Watson 22nd annual "Best Practices in Health Care Employer Survey," employers are focused on increasing choice of benefits for employees. Specifically:

  • Choice in health plans (core medical): 84 percent today; 92 percent by 2019
  • Choice in voluntary benefits: 66 percent today; 86 percent by 2019

With choice comes the need to provide more assistance to employers as they evaluate, choose and enroll in benefits plans. Today, 44 percent of employers are offering tools to support these enrollment decisions; 73 percent will do so by 2019.

Employers offering private marketplaces to employees are more likely to do the following (as compared to employers who are not using an exchange):               

  • Offer voluntary benefits: 88 percent versus 64 percent
  • Offer plan cost calculators to support enrollment decisions: 85 percent versus 53 percent
  • Offer recommendation tools to support enrollment decisions: 79 percent versus 37 percent
  • Create a virtual shopping experience for enrollment: 79 percent versus 20 percent

Q: Do you think tactics used by large employers like Lowe's and Boeing to negotiate directly with providers will become a norm?

CC and AH: Based on the results of the Willis Towers Watson survey, 6 percent of employers surveyed contract directly with providers to secure better pricing of medical services. However, employers responded that they expect the percentage will increase 3.5 times to 21 percent by 2019.

So, while not yet widespread, it seems the practice is gaining momentum. 

More articles on payer issues:
Trump executive order looks to ease regulation on association health plans
Trump blocks Iowa's ACA waiver
Humana signs value-based agreement with 248-member physician group

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