Driving the Shift

As of mid-June, 8 million Americans have enrolled for health coverage in the health insurance marketplace (also known as the “exchanges”), a program born of the ACA. Some of those 8 million people did not previously have health coverage at all; others had previously been covered by their employers but sought coverage through the exchanges when they lost their company-sponsored health insurance. Where did their employer-sponsored coverage go?

Many companies – including behemoths Walmart, McDonald’s and Starbuck – are laying off employees or reducing their hours in order to avoid the directive to buy insurance or pay the fine for failing to do so. In fact, a Congressional Budget Office (CBO) report issued in February estimated that by 2017, the American workforce will be reduced by the equivalent of 2 million full-time jobs, because of the ACA. To take this a step further, prominent bioethicist Dr. Ezekiel Emanuel recently predicted most employers will discontinue providing health coverage entirely by 2025.

In addition, some people are voluntarily leaving their jobs, now that affordable health coverage is available. This is particularly true for older employees who are not yet eligible for Medicare. No longer do these individuals need to continue working solely to retain their company-sponsored health insurance, because enrolling in the exchanges does not require a health screening nor does it exclude for pre-existing conditions. In fact, with the ability to enroll in the exchanges, a person of any age is now no longer tied to their employer to keep their health coverage – creating a fundamental shift in how healthcare is provided in our country.

Pros and Cons of a Portable Workforce

Americans who enroll in the exchanges can take their health insurance with them wherever they go, whether it’s to a different company, into retirement, or being self-employed. A portable workforce that doesn’t have to rely on an employer for health coverage creates an independence that promotes self-employment, creation of start-ups and a capitalist society with greater innovation.

However, individuals enrolled in the exchanges cannot deduct their health insurance premiums from their annual tax returns. And while companies that provide group health insurance can deduct those premiums, employers who avoid paying for group health insurance by pushing employees to the exchanges will face a mandate to pay a penalty with after-tax dollars. This can be seen in the recent IRS ruling that bars employers from pushing workers into exchanges, which the The New York Times covered in an article on May 25. We predict that once the exchanges become more fully developed, future legislation will be introduced to allow employers of all sizes to move employees freely into the exchanges without penalty.

As the demand for coverage through the state exchanges increase, the ACA’s health insurance marketplace will improve its products and options. And as more people enroll in the exchanges and no longer rely on their employers for health coverage, America will see a more portable and innovative workforce take shape.

There are a number of ways health plans can cut unnecessary expenses, both before hiring a print and fulfillment vendor and during the course of the relationship. The key is knowing where to look.

This blog entry, Part 2 of 2, shares what you can do while you’re working with a print and fulfillment vendor:

Be strategic in how you handle the change order process.

Change orders can get very expensive, and unfortunately, they are going to happen. In Part 1, we covered tips on how to mitigate some potential errors, such as getting your materials in the best possible order before they go to the printer. But unexpected things are going to happen – you must plan and prepare for change orders.

Most importantly, always budget for change orders. Pull print and fulfillment orders from the past couple years and calculate the average amount you spent on change orders. Then include that amount in the budget for your next job.

Compare the vendor’s track record to the Service Level Agreement.

Presuming you followed the suggestion in Part 1 to set a Service Level Agreement that ensures the vendor has the flexibility to accommodate unpredictable timelines, regularly review the SLA to ensure the vendor is meeting your deadlines.

A vendor’s ability to meet its Service Level Agreement is a direct indication of its performance. Was the vendor able to meet your deadlines despite only having two days to complete your last print job, as outlined in the SLA? If not, the vendor may not be the best fit for your needs.

Hold Quarterly Business Reviews and challenge the vendor to add value.

Once a quarter, meet with your print and fulfillment vendor to debrief and discuss potential areas of savings. Talk about what went well and what didn’t go well during the past quarter, and what should be done differently in the future.

Don’t be afraid to ask your vendor how they can add more value. For example, pose the following question and see what kind of answer you get: “If I told you we need to reduce our spend by 10 percent, what would you do to make that happen?”

If the vendor is truly your partner, they will continually look for and suggest solutions to achieve better integration of workflows, which will translate into savings for your health plan.

There are a number of ways health plans can cut unnecessary expenses, both before hiring a print and fulfillment vendor and during the course of the relationship. The key is knowing where to look.

This blog entry, Part 1 of 2, shares what you can do before you contract a print and fulfillment vendor:

Get your process workflow in order.

If your health plan is providing its print and fulfillment vendor files that have errors, do not have all necessary approvals or are not in compliance with CMS, you have problems right out of the gate. Errors in data grids and crosswalks alone lead to costly reprints.

Make sure your marketing communications and compliance departments have the right tools to streamline workflow, track materials and ensure compliance. That way, your materials are in the best possible order before they go to the printer. This also helps set a good example for the vendor and implies you have high expectations for them, as well.

Understand the vendor’s true capabilities.

Select a vendor that matches your level of success. The larger the health plan, the greater the complexity of its printing needs – especially for government-sponsored plans with the additional risk that the Annual Notification of Change (ANOC) bring.

If you hired a local vendor when your health plan had 15,000 members and it now has 50,000 members, seriously consider investigating whether that vendor is still the best fit. A smaller vendor simply may not be able to handle the numerous checks and balances required to meet CMS regulations.

In the RFI, ask questions specifically about Medicare and Medicaid.

In your Request for Information, ask the vendor questions that allow you to confirm they understand and have the ability to handle the complexities of CMS, such as: “Can you give an example of how you have handled the ANOCs in the past, including how you addressed challenges with deadlines for these document?”

Consider hiring an unbiased, independent consultant to do the RFI for you, and ask them to use a weighted scale based on importance to find the vendor that best meets your needs.

Do a site visit before hiring the vendor.

Visit the vendor’s facility before making any hiring decisions. Observe their output and Q&A process, which is spot-checking materials for quality as they come off the press. Also, make sure the equipment can handle the size of print runs you know your health plan will require during the busy time of year. Failure to do this could result in missed sales opportunities due to materials not being available.

Ensure the vendor is flexible enough to handle delays caused by CMS.

A Service Level Agreement (SLA) is a timeline of all tasks associated with a print job. It’s especially important for government-sponsored health plans to make sure the vendor is flexible enough to handle delays and complications presented by CMS that will impact production timelines.

Your vendor must understand that they may have either 10 days or two days to produce materials, and they must be able to manage their workflow to accommodate expedited jobs. Make sure the vendor’s SLA is flexible enough to meet your deadlines.