5 Factors Affecting Healthcare Spend in 2022

by | Jun 8, 2022 | Healthcare

Challenges continue to mount for employers trying to keep their healthcare spend under control without stripping benefits for their employees. “The top cost drivers for 2022 are similar to those of 2021, with musculoskeletal conditions and cancer ranking number one and two, respectively, followed by diabetes, cardiovascular and high-risk maternity,” says Ellen Kelsay, president and CEO of Business Group on Health. “Prescription drug costs continue to accelerate at an alarming rate, specifically costs associated with specialty medications.”

We find ourselves in one of the tightest job markets in recent memory and healthcare benefits are an essential part of the recruitment strategy. How robust does the benefits offering have to be to attract top performers? With new considerations in the healthcare landscape like the coronavirus and investors buying up health systems and private practices, plan costs are rising. The lack of transparency in the healthcare billing space has reached new heights with regard to policies, hidden broker fees and pharmaceutical costs. It’s never-ending and you have to be on top of your game to stay ahead of these rising costs.

Employers can take certain actions to control individual cost centers by adding services that address specific challenges in their employee population. If your broker is not providing insights into these services it may be time to shop for a new broker. It is a crucial time to identify the top drivers of your businesses healthcare spend in 2022 and decipher ways to mitigate these costs.

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Here are five drivers shaping healthcare spend and some tips to mitigate each:
COVID
Due to the pandemic, people decided to skip their annual well visits, forego preventative screenings, and put off elective surgeries. In 2022 we are going to see a rush to make up for all these delayed health services. This will in some cases result in later-stage disease diagnoses that will be more costly to treat. Chronic conditions will require more aggressive measures to manage their health and don’t forget about the long-lasting effects left behind from Covid infections. All these things are going to have a negative impact on healthcare spend in 2022. Adding benefits for those with chronic disease and partnering with surgery centers can assist in cost savings for employers. Encourage employees to use free primary care services on your plan and offer flu shots on site.
Telehealth
There are costs associated with the initial telehealth integration into a health plan. Finding the right vendors can also be tricky but the right broker or consultant can help navigate this obstacle more successfully. The right broker/consultant can also assist with training for plan members regarding the value of telehealth – and when, and when not to use it. In the long run, the cost savings with a solid telehealth program will far outweigh the startup investment- not to mention it is one of the most sought-after health benefits in 2022 by employees across all industries. The Business Group on Health found that 76% of employers responding to a survey in 2020 said they modified plans to allow increased access to telehealth and virtual care.
Loss of Independent Providers
Many physician practices and specialty clinics either vanished or sold themselves to the local health system or an investor group. Closed primary care practices drove patients to the ER or urgent care which increases healthcare cost and drives up insurance premiums. Look for more value-based arrangements that incentivize members to choose higher-quality service providers with onsite or near-site clinics contracted for services, and concierge options. This can lead to better health outcomes and savings.
Talent War
No industry is immune to the shortage of candidates. It’s time to offer better benefits and health coverage. Consider adding more elected (voluntary) benefits to sweeten the plan. Financial wellness, behavioral wellness and specialty pharmaceutical options are a good start and can lower your overall healthcare spend. Ask your broker for recommended vendors.
Individual Employees
Employees covered by the plan represent the largest cost factor, year in and year out. Especially for companies with 500 lives or fewer, a few needlessly costly individual healthcare choices can cause a claim spike. Nurse Deb Ault of Ault International Medical Management recommends engaging a consultant “The consultant will bring a vendor partner to the table to work directly with patients at point of sickness.” A health system navigator for members can help them make better choices & provide long-term savings.*