Small employers look to advisers for guidance on health plan affordability, access

When it comes to the national healthcare discourse, the terms “affordability” and “access” are commonly conjoined by politicians, media and others as if they are naturally and easily coupled. But health plan advisers understand that without an expert hand, successfully balancing this combination for small businesses and their workers is more often the exception rather than the rule.

With so much high-profile and public discussion around healthcare reform, the concepts of affordability and access are getting bandied about like never before. A marketplace that offers a good mix of reasonably-priced health plan options is certainly the ideal. Yet market forces frequently conspire to keep these ideas misaligned, or even at direct odds. This often leads to a very frustrating disconnect for employers and employees seeking the best of both.

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One way that brokers and benefit professionals can help dial back this frustration is by helping provide clarity about what affordability and access actually mean and why they often do not align readily on their own.

Take affordability. For many the word connotes “inexpensive,” but the term is quite relative and depends on a myriad of factors such as household income, care needs, overall health and much more. But at the core, affordability boils down to price — for the plan premium, deductibles, co-pays, out-of-pocket costs and so forth.

Pricing considerations affect all businesses, but especially those in the small-group market. Smaller employers tend to be very cost sensitive when it comes to benefits, and what is affordable for one may not be for another. This is where an approach such as a defined contribution model can be attractive, as it offers a variety of flexible budget scenarios that, if used correctly, can help manage costs year-to-year. It’s also where well-designed healthcare exchanges can shine because they enable plan comparisons based on price (along with many other choice factors).

A complicated descriptor
Access, on the other hand, is an extremely complicated descriptor. Here we are talking about access to care (rather than to insurance itself).

At its baseline, “access” refers to whether or not physician, pharmacist, therapist, hospital and other provider services are available and, if so, if there is an adequate supply. But this definition only scratches the surface. Factors such as location, quality, utilization and more are also important components in the overall equation.

So as experienced agents well know, access is highly variable and complex. In many instances, it is also increasingly being tightened to hold down costs — and this is where affordability and access clash. Pushing rates lower often means constraining choices, which in turn impacts access. The recent rise of narrow physician networks is one outcome of cost-access balancing efforts.

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Also, coverage levels can lead to unintentional distortions or misrepresentations of “accessibility.” For example, a person covered by a bronze plan living in a more populated region may have much better access to care than someone with platinum coverage in a rural area. Assessing these potential disparities requires a keen eye and the practiced hand that only a health plan professional can effectively provide.

Clearly, the notion of healthcare accessibility is extremely complex. That said, most people tend to internalize and define “access” personally. They want to know that their doctor, specialist or hospital is available to them before making plan selection. This is simple to say but not always easy to do. Brokers and benefit specialists play integral roles here in helping small businesses not only shop and compare plans, but also in working with employees to confirm that selected plans connect to desired networks and care providers.

Conversations about affordability and access in the healthcare marketplace will continue to dominate headlines for months and years to come. As such, those in the small-group market will continue to lean heavily on the skills and insights of advisers who can help them find the right equilibrium.

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