Opportunities for EAPs
Surviving the Tidal Wave of Change
.
Now What??
W. Dennis Derr Ed.D. LPC BCPC
Staff VP, Anthem Government Business Division
Medicaid/Medicare Behavioral Health
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Strategic Discussion Areas
• A short walk down memory lane.
• Threats and Opportunities as a result of historical
Disruption Innovation in Health and Benefits as a result
of Managed Care, the Affordable Care Act,
Demographics, Technology
• Impact of the coming self accountability focus via
technology, benefit changes and generational shifts
• Future Opportunities for EAP professionals including the
Expanding Medicaid Medicare market.
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Disruptive Innovation is here!
A disruptive innovation is
an innovation that helps create a new
market and value network, and
eventually disrupts an existing market
and value network (over a few years or
decades), displacing an earlier
technology.
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EAP Memory Lane
1970’s
The growth of internal EAPs….Insurance payments for mental health
1980’s Random drug testing…….Birth of Managed Behavioral Health……Hughes
Aircraft EAP medical savings study published.
1990’s External EAPs begin to replace internal EAPs……Worklife Programs and
Wellness Programs rise in popularity. Rise of global EAPs
2000’s Internal EAPs are endangered species…..extensive price competition
in behavioral health benefits, medical cost rises fastest in history, benefits
cost savings (lowest price) focus. Mental Health Parity and the Affordable
Care Act passed. Technology rise.
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What do you think?
Average session payment MSW through Insurance
$200
$180
$160
$140
$120
$100
$80
$60
$40
$20
$0
MSW Session
$75
1980
$64
Factoring
Inflation
2014
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The Current State of the EAP Landscape
• EAP/Worklife continues to be a bundled 3nd or 4th tier
product in the insurance industry.
• EAP/Worklife continues the march downward as a
commodity price product. Recent 3 session prices:
– 10 cents PMPM for a large midwest manufacturer,
– 5 cents PMPM as part of an employee disability plan seller.
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Current State of the EAP/Worklife Industry
• EAP/Worklife is already being included on
a limited “free” basis into medical plans
provided on Federal and Private Health
Exchanges.
• Movement to control cost by driving most
services to self service on the web and
reduce call center staff and limit face to
face provider costs.
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What do you think?
Cost of EAP 3 session model 1986-2014
$3.00
$2.50
$2.00
1986
2014
$1.50
$1.00
$0.50
$0.00
1986
2014
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Questions to Ponder?
• If the average EAP utilization is 3-5% annually, is it
worth covering the other 95-97%?
• If employers have been doing health risk appraisals and
offering wellness programs for 25 years…..why are we
less healthy?
• Why is the user satisfaction rate with a disdained
aggressive low price EAP company, the same level as
more expensive traditional EAPs?
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Affordable Care
State Exchange
Federal Exchange
Medical Home
Public Exchange
Medicaid Expansion
Coordinated
Accountable
Care
Integrated
Care
Coordinator
Gold
Plan
Accountable
Care
Organization
Platnum
Plan
Bronze
Plan
Private Exchange
Minimum Actuarial Value
Maximum
Weekly
Hours
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Disruptive Affordable Care Act Basics
• Effective 1/1/14 every American had to
have health insurance provided either by
their employer, through a state health
exchange, or individual purchase.
• Small employers with fewer than 50 full
time equivalent employees are exempt
from any penalties..
.
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Disruptive Impact of the Affordable Care Act
• In states (23) that did not support the expansion of
Medicaid through the Act or by setting up exchanges,
saw reductions in federal funding for substance abuse
and mental health treatment.
• Private Exchanges set up by Aon, Mercer and other
consultants continue to grow offering providing ease of
participation for employers who want a single service
point and no accountability.
• .
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Disruptive Impact of the Affordable Care Act
• Federal exchange prices and coverage are pushing
employers to match pricing and coverage options with
insurers.
• Within the Exchange markets some level of “free” EAP is
being built in through bulk purchase contracts with EAP
marketers. This will continue to reduce the price and
likelihood of success in the free standing EAP sales
market.
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Disruptive Impact of the Affordable Care Act
• Free EAP continues to be added in at expanded levels by
insurers, delivered primarily via web based and
telephonic services to hold down costs.
• Already some employers are questioning if they go into
the exchange what responsibility do they have for add
on benefits like EAP and Worklife?
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Disruptive Impact of the Affordable Care Act
• Remember that under parity and the DOL
EAP rule EAP can not be a substitute for
behavioral health coverage or be
considered as providing treatment.
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Employer Response to the Affordable Care Act
• Employers are moving toward a “Chinese menu”
approach to benefits and services, buying only what they
need for a specific situation. EAP and Worklife, may
become an “as needed” non essential service like CISD
or Fitness for Duty evaluations.
• Self Insured Employer’s providing healthcare can deduct
incentive costs for certain participatory wellness
programs and health-contingent wellness programs
limited to smoking, metabolic syndrome, fitness program
or educational program participation, weight reduction.
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Employer Response to the Affordable Care Act
• According to The Prudential Insurance Company
•
of America’s (Prudential’s) Seventh Annual Study
of Employee Benefits: nearly a third (31%) say
it’s likely that fewer employers will offer health
insurance coverage.
Mid-size employers (500 to 9,999 employees)
anticipate a greater impact on all aspects of
employee benefits compared to small or large
companies.
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Employer Response to the Affordable Care Act
• Sixty-eight percent say that health care reform
will have a significant impact on employee
benefits funding, and 61% say it will have a
significant impact on employee benefits
communications. Large companies (10,000+
employees) were less likely to say that the
number of employee benefits offered will be
impacted.
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Employer Response to the Affordable Care Act
• Large service industries are considering
utilizing PEO’s (Personal Employment
Organizations) to fill needs via a
contracting mechanism that releases them
from healthcare obligations and allows
more flexibility in seasonal staffing needs
and overhead management. This would
allow for a split workforce benefit offering
without being discriminatory.
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Walmart Bails On Obamacare-Sticks Taxpayers With
Employee Healthcare Costs Forbes 12/09/12
Applebee’s CEO Threatens to Fire Employees And Freeze Hiring
Because of ObamaCare
Washington Post, November 9, 2012
Wendy’s Franchise Cuts Employee Hours to Part Time to Avoid ObamaCare
USATODAY 1/ 07/13
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States Cutting Hours to Avoid Obama Care
Fox News 2/13/13
The costs of Obamacare are not just hitting businesses this year--they are also hitting
the government, and public employees as well. Virginia, for example, is about to limit
part-time employees to 29 hours per week in order to avoid triggering Obamacare’s
requirement that employers provide health insurance to those working 30 hours per
week or more. The state cannot afford the $110 million annual cost of insurance.
Elsewhere, public institutions are taking similar steps to limit part-time work. In Ohio,
Youngstown State University recently announced a 29-hour-per-week part-time limit,
and placed employees on notice that they would be fired if they worked more than the
maximum. Other public universities are doing the same across the nation, just as their
private-sector counterparts are limiting part-time hours to avoid the Obamacare rule.
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Disruptive Impact of The Affordable
Care Act so far….
• Retail and service industries have been
eliminating healthcare coverage, by
reducing weekly hours below 30 per week,
paying fines, or changing employee status.
Wal-Mart is already manages hours to
ensure the majority of their employees
stay under the 30 hour threshold.
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Be Scared
Small business insurance market from health law delayed a year
By Bloomberg News Service
April 2, 2013
Small business employees will have to wait a year before they can choose
their own medical plans after the Obama administration delayed a part of the
2010 Patient Protection and Affordable Care Act intended to provide them
with coverage options. Starting in 2014, workers at companies with fewer
than 100 employees were supposed to have been able to choose from a
variety of health plans through new small business insurance marketplaces.
They’ll instead wait until at least 2015, according to regulations released by
the U.S. Department of Health and Human Services. In the meantime, small
business employees will face a situation similar to what most companies
offer, with their employers choosing the coverage. Health insurers will still
offer the plans, though they’ll be competing for business from companies, not
individuals.
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Be Scared
Likely impact will be to further drive small businesses
to force employees into exchanges as individuals to
be able to collect the tax benefits of covering their own
healthcare cost. Small business’ that have current
health insurance coverage may face increases in
premium costs, pushing the Increase onto the
employee, or stop providing health care benefits
completely.
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Employer Response to the Affordable Care Act
• Managing the physical and psychological aspects of a
newly insured population still falls on primary medical
professionals under the medical home model and
affordable care organizations not the employer. Non self
insured employers will feel less motivation to support
employee wellness or other programs without a direct
business cost value ratio for doing so.
• For large employers or those in highly competitive talent
industries, they are likely to maintain a high level of
broad benefits to maintain staff. This group represents <
20% of the employed workforce.
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Disruptive Impact of The Affordable
Care Act so far….
• According to Mercer an estimated 30% of small
businesses (<500 ees) moved their employees
into the State or Public Exchange Markets in
2014, estimated to increase to +50% by 2015.
• Private exchanges have grown in 2015 for
employers, and employees to shop for benefits.
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Disruptive Impact of The Affordable
Care Act so far….
• Major insurers estimate that by 2015 30-
50% of their revenue (not profit) will
come through individual purchases via the
State or Private Exchanges. With growing
revenue from Medicaid and Medicare.
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The way in which health and medicine is practiced
today is no longer sustainable. Health insurers,
medical professionals will in the next 3 years
quickly become the extension of a mobile or web
application”.
M. Bertollini, CEO, Aetna, Keynote at the 2012, M Health Global Conference
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• Over 30,000 health focused mobile
apps were developed in 2013
• Over 1M websites are related to
individual health issues or treatment
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• Smartphone applications are an emerging
delivery model for services that are:
– Structured and based on a simple decision matrix
– Reinforcing or reminding of specific behaviors or
activities
– Provide information (video / text) and allow for
further exploration
– Can be easily adaptable/customizable for specific
patient conditions
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Disruptive e-Health Trends
(Mobile, Web, Tablet)
• Lab in a stamp (<$1) being validated for use with urine
or blood with 16 diagnostic diseases on one card.
• ECG on mobile device is in final FDA approval
• FDA has issued preliminary review and approval regulations for
health apps. Telcoms partnering with developers.
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The Truth About Apps and Web
• Health and Behavior Mobile app effectiveness is
linked to being an integrated critical part of the
treatment plan by the treating professional.
• Condition specific texting and rewards for
response has shown clinical effectiveness in
various populations and cultures beyond
Smartphone apps.
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The Truth About Health Apps and Web
• With a technology and web skilled population what is the
single point of use value?
• Mobile and Tablet Apps are designed for specific use and
have limited long-term continued use
– Most continually used apps according to “AppWorld”
are:
1. Music, 2. Social, 3. Games. 4. Porn
5. Navigation
– Beyond the top 5 which have daily use, all others
loose appeal within 14 days and are used one
average once per month.
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e-CBT Preferred
Most of the British
Commonwealth’s
NHS’ now recommend
e-CBT as more
effective than face to
face counseling based
on research
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E-CBT Apps
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The Truth About Behavioral and Health Apps and
Websites
• According to web experts most apps and websites in the
health industry are too busy, complex and not engaging.
• Much of what is available on EAP/Work Life/Wellness
websites is available in the public domain of the web.
• Community “helpline” services are growing in
metropolitan areas. Sponsored by private entities,
governmental agencies they provide general information,
child/eldercare resources and local resources.
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Truth About EAP/Behavioral Health Websites and
Mobile Apps
• Format and design are primarily focused on;
– Informational-articles on health, condition
education etc.
– Convenience- Find a counselor, simple
screenings
– One time use or special need single use tools.
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Truth About EAP/Behavioral Health Websites and
Mobile Apps
• Little user motivation for continual engagement for
•
behavior change.
– Sites are usually “static” in content and design
– Actual user registration with more than one use is
usually < 1% of covered population
– Most EAPs/BH report cumulative registered users or
web page visits which distorts web utilization.
Inclusion of Wellness, Financial and a variety of Work
Life topics increases density of site while decreasing
engagement usability. More is not better.
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The Future is Virtual Delivery of Service
• Reducing costs of delivery, while maintaining
•
quality service levels is critical in the behavioral
field.
Options to consider:
– Management App that provides basic tools,
screening, instructional videos and resources.
– Employee/Family App that provides basic
screening tools, instructional videos and
resources for employees.
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Maybe We Should Do Wellness?
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Wellness, Wellbeing, Health Risk Appraisals
and EAP/Behavioral Health
• Wellness is not new to EAP.
– First EAP sponsored wellness HRA was through Dr. Eddington of
U of Michigan and Michigan Bell EAP in 1982.
• Since American’s have been taking HRAs
for over 30 years what is the level of
health improvement?
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Wellness, Wellbeing, Health Risk Appraisals
and EAP/Behavioral Health
• To expand appeal of EAP many are incorporating
•
Wellness links or programs. ValueOptionsLimeaid, Magellan-HealthCoach, PPCW-Wellbeing
HRA
Co morbidity of psycho-social distress, mental
health conditions and health although well
documented continues to be seen as separate
issues by employers, plan participants and the
medical focus of major insurance organizations.
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Is Wellness Via EAP Viable?
• EAPs as Wellness vendors are weak in direct competition with
stronger better funded Wellness marketing organizations, disease
management etc., with product integration, extensive apps and web
capability.
• Stand alone Wellness providers (ActiveHealth, Healthways, etc.) did
not get a significant boost due to the ACA definitions of wellness for
self insured employers despite mandatory “wellness” componets in
ACA legislation.
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Is Wellness Via EAP even Viable?
• Current Market confusion on what constitutes wellness is
now being defined by the recent ACA rules on incentives
limiting offerings.
• Publication of “Why Nobody Believes the Numbers” by Al
Lewis and “Cracking Health Costs” by Tom Emerick and
Al Lewis have excited the benefit field by pointing out
the failure of Wellness and disease management.
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Now that we are depressed!!!!!!
What is an EAP professional to do????????
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TO PREPARE FOR THE FUTURE
TO PREPARE FOR THE
FUTURE
YOU NEED
TO CREATE
CREATE IT
IT
NOW!
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Reading the Tea leaves
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Your Reading
• Pay attention to changing demographics
– 1+ Million baby boomers are retiring every month.
– More than half the US population is now covered by a form of government
healthcare and growing.
– Majority of workers are now either part time, contracted or occasional.
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Your Reading…..
• Public Sector Healthcare (Medicaid/Medicare) will continue to grow
– 8 newly elected Republican governors are now looking to expand
Medicaid in their states
– Biggest influencers in healthcare are government –CMS-VA-Tricare
– ACA enrollment is growing in year 2
– Major insurers are buying and consolidating Medicaid/Medicare
managed care companies to establish strong growth positions.
Aetna- Centene, Anthem – Amerigroup, Cigna -?
– Healthcare has surpassed US manufacturing in employment in the US
– “Beds, Meds and Eds”
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Your Reading……
• Fastest growing area of behavioral health is in Medicaid/Medicare.
• Growth in integrated physical and behavioral health in Medicaid was
responsible for record profits for Anthem BCBS. (Billions of $$$)
• CMS parity rulings are expanding the role of BH in integrated physical and
behavioral health.
–
–
–
–
CMS Autism Parity Letter to States
CMS NCQA requirements for BH and PH
Expansion of Substance Abuse benefits.
Expected Behavioral Outcome Measures with penalties and incentives in 2015
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Your reading…….
• You have skills, talents and experience that creates an
entrepreneurial
opportunity for your future in public sector
behavioral health. You can create or adapt to take advantage of the
growth over the next 10 years.
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So Where the Entrepreneurial
Opportunities?
–
–
–
–
–
–
–
–
Follow Up post discharge coordination and support
Preventive or ER behavioral health assessment and referral
Post hospitalization care coordination support
Educational support for chronic populations (NY HARP)
Special needs consultation
Onsite Medical Home BH coordination
Autism support services
Life Skills training, housing resources.
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Your Reading………
Where are the Opportunities with Employers?
• Rethink the value proposition around what employers
will value most with changing demographics.
– Crisis response (limited business growth model)
– Immediate interventions (limited business growth)
– On demand Consultation for workplace
issues/interventions/training
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Your Reading………
Where are the Opportunities with Employers?
Focus
–
–
–
on Leadership training at the front line level.
Offer as part of your practice (Coaching +)
Solve the demographic leadership problem for employers
Deliver through alternative sources (continuing education, social
media, religious institutions)
• Be innovative and be brave. Remember that when faced with
change or moving forward, most people put most of their effort in
preventing or denying the existance the change occurring around
them.
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Be innovative and be brave.
Remember that when faced with change or moving forward, most people put
most of their effort in preventing or denying the existence the change occurring
around them.
The failure rate of not trying is always 100%
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A competitive advantage begins with a launch process, in
which an organization identifies an opportunity and mobilizes
resources to capitalize on it.
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W. Dennis Derr Ed.D.
Email: w.dennis.derr@gmail.com
Mobile: 703-863-4596
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