The Operating System For Employer-Funded Healthcare

No matter the industry, nearly all U.S. employers are in the healthcare business, a reality reflected on balance sheets, and one that can keep even the most stoic CFO sleepless at 3:00 a.m. And more of those companies are opting for self-funded health insurance programs.

The money spent by those employers represents a form of significant control over healthcare. What happens, then, when employers, who self-insure the healthcare benefits they provide employees, are given more control over their own spending via software? That was the topic of discussion for the most recent PYMNTS “Matchmakers” interview, during which Karen Webster spoke with Rajaie Batniji, a doctor who is co-founder and chief health officer for Collective Health, which provides digital health management services to companies.


Healthcare Gaps

The problem Collective Health seeks to address is bridging the gap between money spent and services provided.

“Look at the amount we spend on health: One in five dollars,” he told Webster. “Yet, our healthcare outcomes lag behind those in other countries.”

Batniji, when talking about the ideas and inspirations behind the company, pointed to an experience to which nearly everyone can relate. Another co-founder of the company had a “surprise medical experience” that required treatment at a hospital, which then resulted in a flurry of paperwork, with the consumer left to figure out what might be a bill and what was not.

“We decided it was time to do something about that,” Batniji said.

Reducing confusion about healthcare payments — and plans, employer costs and other factors — means reducing friction, and reducing friction requires a certain amount of what Batniji called “re-engineering” of the system. However, there is only so much re-engineering a single industry participant can do, given the power wielded by insurance heavyweights, for instance, and the power of legacy and tradition.

But with U.S. employers accounting for 85 percent of private sector healthcare payments, according to Batniji, there are certainly opportunities, especially if one focuses on the “influx and outflux” of the process.

Employer Visibility

What Collective Health provides is visibility for employers, via the software and its associated dashboards. The company has partnered with “several leading insurance carriers,” he said, with the list of partners having grown “from a couple to dozens” over the last few years. That reflects the demand from employers, as they “are demanding they want to use network X, Y and Z solutions,” he said.

In fact, Batniji likened the company’s platform to an operating system that can run other technology. Among the most popular healthcare options on the Collective Health platform are behavioral health, maternity and telemedicine.

“We prioritize based on what our employer customers want,” he said. “We didn’t invent that as one of our priorities.”

The Collective Health platform also enables employers to tie together their health insurance data, their core human resources systems, and the network and plan information. Analytics and performance dashboards enable employers to keep track of healthcare costs and employee impacts. The platform adjudicates claims, manages eligibility and other tasks.

Employee Features

For employees, via the platform or the Collective Health mobile app, they can check details about coverage or care after creating a customized plan for themselves. The company provides digital health cards to employees, and “member advocates” who offer guidance in a live-chat format. Those features can especially appeal to “people on the road, or workers on the factory floor — people who do not have good health literacy,” he said. “Those are the people who benefit the most.”

The technology can help those employees concerning “where and when to seek healthcare because they understand how their plans work,” Batniji said, who told Webster that average annual cost savings can run up to $500 per employee. Encouraging that judicious use of healthcare — as opposed to not seeking care, which can lead to even larger costs down the road — helps if the choices are offered by employers to employees, he said.

“We don’t focus on offering a plethora of plan choices,” he said, agreeing with the theory that if a shopper looking for shoes is faced with seemingly endless choices, that consumer might feel overwhelmed and simply give up. In healthcare, too much choice can lead to consumers making “suboptimal choices.”

Batniji said work is ongoing in gaining more employer clients, and the company is at the point of critical mass. There is no question that citizens and consumers are focusing on how to make healthcare better in the United States (whatever “better” might mean to different groups of people), and expanding digital technology capabilities, along with corporate moves, promise more changes to come.



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