What the University is Doing
Health Care Strategy Advisory Committee Progress Update
The Health Care Strategy Advisory Committee (HCSAC) has been meeting regularly since President Simon’s February letter to the MSU community about the impact of rising health care costs at MSU. The committee was created to analyze data related to health care costs and explore options for constraining those costs in ways that maintain access to high-quality health care for MSU faculty, staff and retirees.
The committee began its work by reviewing an extensive analysis of several years’ worth of billing and health care benefit usage data. It looked for trends and patterns in health care usage and costs as well as areas where MSU compares well or unfavorably against national benchmarks. The committee also met several times with representatives of CVS Caremark, MSU’s prescription drug plan administrator. During these meetings, it reviewed trends and began to identify opportunities for changes that could improve the health of the MSU population while decreasing costs.
In addition, the committee also reviewed and discussed research and case studies of health care cost reduction strategies that have proven successful for other employers both inside and outside of higher education.
All these combined efforts yielded many ideas and potential strategies for constraining costs at MSU. The committee identified and agreed upon seven areas that merit deeper analysis. The committee selected these seven areas with the end goal of supporting the University in its commitment to provide health care to MSU employees and retirees that:
- Relies on evidence-based care and therapies proven to be effective
- Achieves significant savings while promoting higher quality
- Is patient centered
- Provides access to care that is safe, timely, efficient and equitable
The committee is now continuing to explore strategies within the seven selected areas. The areas are listed below in no particular order of importance or preference. It is important to note that the presence of ideas or concepts on this list does not mean an idea will be implemented. It simply means these ideas have been selected for further research and exploration.
Centers of Excellence. A “centers of excellence” approach to benefits management identifies certain health providers or systems that consistently deliver the best medical outcomes for patients with certain health conditions and/or patients who need certain types of treatments or procedures. The benefits plan design is constructed to incentivize employees to use those providers. This approach maximizes quality for patients because it steers them toward the providers most likely to help them achieve the best health outcomes for a given health condition (e.g. heart disease, diabetes, arthritis) or type of procedure (organ transplant, knee repair, hip replacement). Centers of Excellence constrain health care costs in two ways:
- In exchange for becoming the preferred provider for a given service for our whole employee population, MSU can negotiate lower rates.
- Centers of Excellence already tend to cost less than other providers. They perform so many of a given procedure or provide so much of a type of care that they are very efficient at providing these services and have a much lower rate of complications that require further costly care.
The committee is continuing to research Centers of Excellence possibilities, with a particular focus on treatment of high-cost, chronic diseases in the MSU population.
Case Management, Care Coordination and Disease Management. Up to 44 percent of chronically ill people don’t get the type of medical care they need. When chronic conditions aren’t well-managed, they often worsen and can result in danger for the patient and much higher costs to the health plan over time. Programs are available that provide confidential support to patients and sometimes medical providers by offering counseling, reminders, education and assistance coordinating care from multiple providers to support people in maintaining better health. The committee is currently researching program options that are offered through MSU’s current health plan vendors but are not currently utilized by MSU.
Smoke-Free Campus. It’s no secret that smoking is bad for your health. But it’s bad for the financial health of organizations too. The Centers for Disease Control and Prevention estimate that employers lose in excess of $3,383 per adult smoker per year in lost productivity and excess medical expenditures. Several universities have recently taken the step of moving to a smoke-free campus. Going smoke free and providing supportive services to help smokers quit could potentially save both lives and money at MSU and is an option the committee continues to research.
Prescription Drug Plan Initiatives. There are a variety of potential opportunities for constraining health care costs within the MSU Prescription Plan. Some areas being explored include incentivizing greater use of generic drugs, increasing the use of mail order drugs or preferred pharmacy arrangements and condition management programs. The committee is currently working with our prescription drug plan administrator CVS Caremark to explore these potential savings areas.
Partnerships with the MSU Health Team. Options for greater utilization of MSU expertise and resources through partnerships with the MSU Health Team are being explored. A separate steering committee has been formed to review options and identify opportunities.
Robust Wellness Programs and Health Risk Assessment. It just makes sense that healthier employees are less costly to their employers’ health plans. Robust wellness programs encourage and support employees in making healthy lifestyle choices in areas such as nutrition, exercise, stress management and fitness. In addition, these programs can be designed to incentivize employees to participate in Health Risk Assessments. This helps individuals identify their possible health risks and develop plans to reduce those risks. The University Physician’s Office is currently leading the effort to investigate potential options in case the University decides to pursue offering a Health Risk Assessment.
Consumer Driven Health Plan with Health Savings Accounts. Consumer driven health care plan designs often pair health savings accounts (HSAs) with a high deductible health insurance policy. A health savings account is often funded annually at a set amount by employers or through a combination of employer/employee contributions. Account holders then use these accounts to pay for their health care expenses throughout the plan year. Remaining funds are carried over to the next year. Since the money actually belongs to the employee, there is greater incentive to use health care resources only when truly necessary and to comparison shop for the best value in services. HSAs are paired with a high-deductible insurance plan that protects employees in case unexpected catastrophic situations result in health care expenses that far outstrip funds available in the Health Savings Account. The committee continues to explore these plan design options.
Throughout the rest of June, July and August, check back often to read more detailed articles about each of these seven areas as the committee continues its research.
Health Care Strategy Advisory Committee Structure
More Information
University Committee on Faculty Affairs