Employer Resource Guide

This resource guide for health care purchaser coalitions and employers provides information and research in key areas such as benefit design, value assessment and health spending.

We’ve developed a resource list segmented by three key issue areas: 

  • Benefit Design
  • Value Assessment
  • Health Spending


Benefit Design

Considering Benefit Design Tradeoffs

Assessing Consumer Tradeoffs: Case Study of an Employee-Designed Health Plan
This analysis summarizes an effort to redesign a benefit option offered by a self-insured employer. In a series of facilitated workshops, employees used a gameboard to first individually design their ideal health care benefit, and then come together as a group to develop a health plan that would best serve the entire organization. The decisions that were made and the dialogue around them elucidated the inherent trade-offs and willingness to pay for various health care services. As policymakers consider new policies for changing the trajectory of current health care spending, it will be increasingly important to engage in a fair dialogue about health care spending tradeoffs. This case study provides a framework for other health care purchasers to engage consumers in constructive dialogue on health care spending.

The Impact of Wage Status and Copay Accumulator Adjustment Programs on Specialty Drug Utilization and Health Care Costs: In an effort to control rising health care costs, payers and PBMs are adopting copay accumulator adjustment programs (CAAPs), which exclude drug costs covered by copay assistance programs from being counted toward the deductible. This can be particularly burdensome for low wage earners. This project will examine the relationship between wage status and the use of specialty pharmaceuticals and other health care services, as well as the extent to which a CAAP impacts these relationships. 

Value-Based Benefit Design

Supporting Consumer Access to Specialty Medications Through Value-Based Insurance Design
This white paper highlighted the importance of recognizing the value of specialty pharmaceuticals using value-based insurance design. The white paper included information on specific techniques and considerations decision-makers should consider to ensure V-BID works effectively for specialty medications.

Variable Copays in Pharmacy Benefit Tiers: Ethics and Efficiency
This research identified the ethical, legal, actuarial implications associated with cost-sharing based on formulary tier rather than medical appropriate for patients. A multi-stakeholder panel identified guiding principles for when it would be more (or less) acceptable to require patients with the same or similar condition to have variable out of pocket expenses.

A “Dynamic” Approach to Consumer Cost-Sharing for Prescription Drugs
This issue brief introduced and defined the concept of “rewarding the good soldier”, which refers to the scenario or circumstance when a patient does not respond as desired to the initial step-therapy, and should, therefore, have reduced consumer cost-sharing. This brief includes clinical examples, discusses the benefits from a more clinically nuanced approach and proposes next steps to move from cost-focused to value-based initiatives in formulary development.

High-Deductible Health Plans

Impact on Premiums of Expanding Pre-deductible Coverage in HSA-HDHPs
This research will build on prior NPC work and encourage further adoption and expansion of pre-deductible coverage. First, it will provide quantitative evidence of the minimal premium impact associated with uptake of pre-deductible coverage for the medications and services in IRS Notice 2019-45. Second, it will provide quantitative evidence of the limited premium impact associated with expansion of pre-deductible coverage to a broader list of medications and services, which can help build momentum for related policy efforts, such as the Chronic Disease Management Act.

Employer Uptake of Pre-Deductible Coverage for Preventive Services in HSA-Eligible Health Plans
In July 2019, the Internal Revenue Service (IRS) issued Notice 2019-45 allowing HSA-eligible HDHPs the flexibility to cover 14 medications and services used to prevent exacerbations of chronic diseases prior to meeting the plan deductible. This study surveyed benefits decision-makers at large employers with HSA-HDHPs to determine whether they changed their health plans in response to IRS Notice 2019-45. The study found many large employers had expanded pre-deductible coverage and would like to further broaden this coverage.

Better Value, Smarter Deductibles in HSA-HDHPs: Improving Health, Equity & Engagement
NPC and the National Alliance of Healthcare Purchaser Coalitions collaborated on an Action Brief, “Better Value, Smarter Deductibles in HSA-HDHPs: Improving Health, Equity & Engagement,” which highlights key steps that employers can take to enhance their benefit design approach to support better out-of-pocket spending, reduce costs, and improve employee engagement, while also considering health equity concerns.

Financial Impact of HSA-HDHP Reform to Improve Access to Chronic Disease Management Medications
Current IRS regulations allow coverage of certain preventive services outside of the plan deductible. This study examined how providing pre-deductible coverage for 57 drug classes covering 11 chronic conditions would impact out-of-pocket costs, plan expenditures and premiums. Although it would increase utilization and shift some costs to health care plans, we found that the overall impact would be modest, requiring a premium increase of less than 2%.

Consumer-Directed Health Plans: Pharmacy Benefits & "Better Practices"
Through the formation of an expert advisory team, literature review, employer survey, and targeted interviews, this research analyzed employers’ views of the current state of consumer directed health plans, how pharmacy benefits are structured and identified best practices.

Good Practices for High-Deductible Health Plans
This project updates the 2014 publication, Consumer-Directed Health Plans: Pharmacy Benefits & "Better Practices." With new considerations for the 2021 health care landscape, identifying the patient-centered good practices in plan design can align incentives across the workforce and mitigate the harmful impacts of blunt HDHP and prescription benefit plan design. This research will provide information on how to design and implement HDHPs in a more patient-centered manner that puts their employees' needs first. 

Tools for Evaluating Your PBM and Consultants

Toward Better Value: Employer Perspectives on What's Wrong With the Management of Prescription Drug Benefits and How to Fix It
In recent years, PBMs’ aggressive contracting practices have come under increasing scrutiny by businesses and the public at large. This survey of jumbo and self-insured employers provides in-depth information regarding employer perceptions of the current PBM business model, their trust level for PBMs, and their preferences for how their pharmacy benefits are managed.

Value Assessment

Addressing Low-Value Care

Reducing Low-Value Care
A literature review of resource optimization work done was conducted to identify existing approaches to addressing low value care. An expert panel was convened to discuss strategies used in each segment of the health system to validate existing work, recommend approaches to filling gaps, and identify the ease to which utilization with low-value care items can be reduced.

Facilitating Employer Efforts to Address Low-Value Care
Working with the HealthCare 21 Business Coalition (HC21), an employer-led coalition of healthcare leaders and other stakeholders in East and Middle Tennessee, this project will explore a data driven employer/provider collaboration to address low-value care in the local Knoxville, Tennessee market. The project leveraged the Going Below The Surface's Roadmap for Addressing Low-Value Care to help design the initiative, and will develop a toolkit for other coalitions and employers to use. (In progress) 

Value Assessment Frameworks (e.g., ICER)

Guiding Practices for Patient-Centered Value Assessments
Twenty-eight guiding practices were identified to address six key aspects of value assessments: the assessment process, methodology, benefits, costs, evidence, and dissemination and utilization. Seven guiding practices for budget impact assessment are outlined separately as budget impact is not a measure of value.

Current Landscape: Value Assessment Frameworks
An assessment of the key characteristics of seven value assessment frameworks in the US: ASCO, ACC/AHA, ICER, IVI, NCCN, PPVF and DrugAbacus. This analysis examined the frameworks through the lens of six broad categories: the framework development process, measures of benefit, measures of cost, methodology, evidence, and the framework assessment process.

Audit of Value Assessment Frameworks Using NPC’s Guiding Principles
This study examined the evolution of the value assessment landscape in the last two years, focusing on three frameworks that are actively conducting assessments: the Institute for Clinical and Economic Review (ICER), the Innovation and Value Initiative (IVI) and the National Comprehensive Cancer Network (NCCN).

Assessing Consumer and Employer Willingness to Pay for New Medical Technologies
This NPC white paper summarizes a survey that explored whether health care consumers and large employers would be willing to continue to pay for new medical technologies associated with significant improvements in patient health outcomes. They found that consumers and employers are concerned about affordability and a majority were not willing to pay a 5% increase in their premium to support access to new technologies, even those with substantial advances in health outcomes.

Including Productivity in Value Assessments

Underestimating the Value of an Intervention Can Limit Access – Why Including Productivity in Value Assessments is Critical
To support patient access, value assessment reports should include patient-centered components of value. NPC reviewed all pharmaceutical value assessment reports published by ICER between March 2017 and July 2019 to determine whether productivity was included, how it was reported, and assessed if inclusion of productivity changed the value category. The exclusion of productivity costs in cost-effectiveness analysis can alter, often underestimating, the assessment of value and hence impact coverage decisions based on these assessments.

Synergies at Work: Realizing the Full Value of Health Investment
The benefits of employee health include the value of reduced absence and improved workplace productivity, and employers that recognize the full range of benefits can maximize the value of their investment in making employees healthier.

Imputing Productivity Gains From Clinical Trials
The costs to employers of chronic health conditions on employee productivity are well documented, but few studies have captured the impact that medicines may have on reducing those costs. This study conducted by Tufts Medical Center and the National Pharmaceutical Council demonstrates a novel approach to measure productivity, using depression and arthritis as case studies.

Barriers and Solutions to the Inclusion of Indirect Benefits in Biopharmaceutical Value Reviews
There is a lack of agreement on the inclusion of indirect benefits (e.g., productivity improvements and reduced caregiver burden) in value assessment. To understand why, in-depth interviews will survey payer, employer, and patient advocacy group views on the barriers to the inclusion of indirect benefits and their receptivity to solutions (e.g., more convincing productivity data, inclusion in standards for cost-effectiveness analysis, etc.).

Alternative Payment Models

Financing for Curative Therapies
This study explores tensions in our health care system via online market research with payers and highlights a few proposals to address these concerns. This research found that when it comes financing innovative and life-changing therapies, the implications and risk factors faced by payers vary according to their size.

Key Considerations in the Design of Payment Bundles
This paper identifies key factors that should be considered in the design of payment bundles and provides case examples that illustrate how each factor should be implemented.

Value-Based Contracting: Barriers and Success Factors

Value-based Agreements May Be More Prevalent Than Previously Known
This project surveyed payers and biopharmaceutical manufacturers to gain a better understanding of the prevalence of US value-based arrangements, their characteristics, and the factors that facilitate their success or act as barriers to their implementation. This study found that approximately 3 in 4 value-based agreements are not publicly known and that previous estimates of VBAs, using only publicly available data, likely underestimate payer and manufacturer commitment to value-based contracting. This analysis also identified several barriers to implementing VBAs as well as factors that contribute to successful contract negotiation and implementation.

Health Spending

Drug Spending in Context

Affordability Is About More Than Drug Prices
Based on a survey of health payer decision-makers, NPC and Xcenda found that potential government involvement in drug pricing would be unlikely to increase patient affordability. Although nearly half said they would reduce premiums if there were a 15% reduction in drug prices, most would not reduce patient copays or coinsurance rates. The research suggested that reforming health benefit designs would be a better approach to truly address affordability concerns.

Historical Impact of Biopharmaceuticals on Outcomes
This study surveyed physicians on which medical technology innovations have had the most impact on health outcomes, particularly in the treatment of eight chronic conditions including HIV, chronic obstructive pulmonary disease (COPD) and depression. Overall, this research found that most improvements in health outcomes were driven by pharmaceutical and biopharmaceutical products.

Do Improvements in Patient Outcomes Explain Rising Costs of Pharmaceutical Treatments?
This project builds on NPC’s “Historical Impact of Biopharmaceuticals on Outcomes” and examined whether increased medical intervention spending on prevalent chronic conditions has been a good investment. This study found that health care spending for six out of seven conditions over a 20-year time horizon was both cost-effective and a source of high value creation.

Efficiency in Health Spending

Health Care Resource Allocation Efficiency
Sustained innovation requires that U.S. health dollars be spent efficiently.  However, many policies that aim to curb health care spending use an indiscriminate approach and focus at either the sector or aggregate spending level. This research will develop an approach to evaluate the efficiency of health care spending at the disease level that incorporates both quality and costs. Ultimately, the two goals of this project are to 1) provide information that helps identify potential opportunities for future health care investment and 2) identify diseases that are potentially associated with lower value care. (In progress)

  • Webinar: It Costs How Much? Understanding Healthcare Spending and Getting to the Root of the Problem: This webinar, sponsored by the National Alliance of Healthcare Purchaser Coalitions, delves into an initiative aimed at getting to the root of two vexing health care spending challenges – what could we do in the United States to better allocate our resources, and how can we ensure those resources are not wasted on low-value care? To get to the root of what’s driving healthcare spending, this initiative is bringing together multiple stakeholders across the country - employers, health plans, clinicians, providers, health systems, patients and others to engage in discussions that ask some tough, “third rail”-types of questions. 

Information Resources

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