Jean Moore, Managing Director with Exchange Solutions for Full-Time Active Employees on OneExchange

For highlights of my perspectives, articles I’ve contributed to and other forums where I’ve shared my thoughts, see me on Twitter at #TWJeanMoore

This post is part of our Exchange Innovator Series featuring leading private exchange, health care reform and Medicare experts from Towers Watson.

I’m Jean Moore, managing director with Exchange Solutions for Towers Watson, overseeing our offerings for full-time active employees on OneExchange.

My overarching responsibility is to meet the needs of the market. Today that means I make sure the exchange works the way it was designed to and I help employers understand how our exchange paradigm can serve their needs – how OneExchange is calibrated to reduce health spend as well as how our model is built on a best-in-class experience for employees.

My health insurance roots

I’m a Fellow of the Society of Actuaries and stay current through ongoing work and analysis within the industry, both for OneExchange and our clients. I’ve spent my career assessing risk and calculating the associated costs for large employers. I started out in our retirement line of business and learned a lot about how to predict the financial impact of future events. When I moved to the health care side of the business I was able to use those skills to help employers predict their future health care costs and then identify solutions to manage them.

Jean More riding Smart Little Laredo

I’m a cowgirl at heart, and I love to spend my weekends on my horses chasing cattle

I had a close-up view of employers’ need to get health costs under control and the increasing difficulty of the challenge. Despite many attempts to manage costs over the years – strategies like self-funding, wellness programs, account-based health plans, prescription drug management, network management and more – it’s been like swimming upstream. The odds have been heavily stacked against them. Now that I’m in the Exchange Solutions business, instead of determining the financial impact for a single employer, we’re doing that for an entire group of employers. So much of the exchange business is tied to financials and my roots as an actuary are really helpful.

Outside of the exchange, our largest employers, the ones who could invest in a whole host of health and cost management strategies, have been more successful at bending the cost curve. But employers who aren’t resourced to throw everything but the kitchen sink at the challenge face crippling cost inflation.

That’s where we came in with our private exchange philosophy. We’ve taken the health and cost management strategies that have helped our best performing clients outperform health coverage cost inflation and built them into OneExchange. And we’ve developed a graded runway to the full model so employers can bring new elements and features on line in a way that works best for their organizations.

We’ve invested over a billion dollars in bringing those strategies into OneExchange so employers don’t have to build it on their own anymore.

That sounds like a story that belongs in the health care start-up space – and it is. I’ve had the best of both worlds by getting to run a start-up business inside a well-established company – I get to be incredibly responsive to the market and to do it with the support of a large, long-standing organization.

Jean Moore hiking in Arizona

My husband, Tom, and I love hiking the peaks and canyons of Arizona.

Where I see health insurance going

I think that the private exchange market for active employees is going to open a lot of eyes and a lot of minds in the next few years.

I believe we’ll see benefits available in more of an individual purchasing environment – and not necessarily in a public marketplace. I’m still talking about a private market that’s employer-supported. The makings are there already with the degree of choice and control and competition we’re turning on with exchanges. The differences between how group and individual plans work are going away. Group used to mean one-size-fits-all. As consumer-centric personalization becomes the norm even in the group space, it won’t feel like that much of a leap to actual individual plans, like what we see with Medicare.

That bodes well for our industry professionals because the benefits that younger workers value and their comfort-level with technology and personal choice are going to have a big impact on how HR and benefits departments work. It’s going to be harder to keep up with the expectations of younger workers in the model where employers hand-select and control benefits for everyone. Private exchanges are engineered to deal with the kind of diverse, personalized environment that millennial workers expect.

I also think we’ll start to see the philosophy of greater choice move beyond medical and insurance coverage to other benefits – even those in work-life areas, like paid time off, flexible working arrangements and learning and development.

Employers will need their benefits professionals to focus more on these new types of benefits, which will allow them to distinguish their employee value proposition better than in the health care space where companies are being regulated into a narrower band of options.

By getting on board with the efficiencies of the private exchange model now, benefits professionals will be putting themselves and their companies in a very sustainable position for the rapid evolution we can expect in years to come.

By the end of 2015, approximately 1.2 million employees, retirees, and eligible family members sponsored by 1,500 different employers will be choosing their health care coverage via Towers Watson’s private health insurance exchange solutions. That’s up from 800,000 at the end of 2014, or nearly a 50 percent increase.

Convergys Corporation, a global leader in customer management, was one of the first companies to adopt OneExchange for its full-time employees. Envision Healthcare, a leading provider of medical transportation and facility-based physician services, and global branded media company Time Inc. are among the new employers that adopted OneExchange for their full-time employees for the plan year 2015.

Here’s what Convergys and Envision had to say about OneExchange:

“We’re pleased that OneExchange has helped us manage escalating costs associated with health care benefits for our company and our employees,” said Dennis Hicks, vice president, compensation and benefits for Convergys. “At the same time, we are pleased with how our employees have responded to the change. Post-enrollment data show us that our people chose their insurance options with an eye toward value… and over 90% felt the information they received from OneExchange helped them make informed choices.”

“Towers Watson has developed a program that allows our employees more provider, health plan and price options than previously available, which is almost unheard of in today’s health care marketplace, said Don King, Envision’s vice president of benefits and compensation. “Expanding insurance carrier options spurs competition, which improves long-term cost-mitigation opportunities.”

Towers Watson’s OneExchange has the distinction of having the longest operating history in the private exchange industry. OneExchange supports all workforce populations, from full- and part-time employees to pre-Medicare and Medicare-eligible retirees.

For more information on the growing numbers of employers choosing Towers Watson’s exchange solutions, read our press release here.

Recent data from a Towers Watson employer survey show that by 2018, the percentage of employers that have confidence in private exchanges as a viable alternative for active employees will grow to 37%. This is more than double the 17% that view them as a viable alternative by 2016.

The new data comes from the 2015 Emerging Trends in Health Care Survey, which surveyed 444 midsize to large U.S. employers representing 7.2 million employees.

Survey results also reveal that 26% of employers have extensively analyzed private exchanges, and 20% say they are more interested in adopting a private exchange today than they were a year ago. Companies that have completed extensive analysis of private exchanges are twice as likely to find private exchanges a viable alternative in 2016 than those that have not.

Participants further reported that interest in cost savings and administrative simplicity is driving their companies’ interest in private exchanges. As a result, more than half (53%) say they expect finance to play a role in any decision to adopt a private exchange model instead of traditional employer-managed health plans.

Broader trends also emerged from the survey results:

  • A majority of employers (84%) anticipate making changes to their full-time employee health benefit programs over the next three years, despite the fact that cost increases have remained at historically low levels
  • The main driver of changes to further lower cost increases is the ACA’s excise tax, which goes into effect in 2018. Two in five employers that have done extensive modeling of their plans say they will trigger the excise tax in 2018. Two-thirds say the tax will have an impact on their health program strategies

Other areas that employers will look at for cost reductions include spouse and dependent coverage, defined contribution arrangements, centers of excellence and high-performance networks, telemedicine, specialty pharma, and greater employee engagement in lifestyle and health behavior changes.

For more survey results in each of these areas, click here for the full release.

Starwood Hotels & Resorts Worldwide, Inc., one of the world’s leading hotel and leisure companies, has adopted Towers Watson’s OneExchange for its full-time active employees and their families. OneExchange will begin delivering health care benefits to Starwood’s 26,500 associates and family members based in the United States starting on April 1, 2015. The move will enable the company to offer its associates high-quality, cost-effective health care coverage with a focus on wellness and health improvement.

“OneExchange allows us to offer more choice in health care plans and carriers, continue providing health and productivity programs to keep health care benefits affordable, and sustain our benefit programs for the long term,” said Starwood executive vice president and chief human resource officer Jeff Cava. “We feel that partnering with Towers Watson allows us to take advantage of their core competence in designing and delivering benefits, and the economies of scale they provide.”

To learn more about Starwood’s decision to use OneExchange, read our press release here.

Every year Towers Watson customer support staff receives thousands of calls from people using OneExchange to find and enroll in health plans. The questions they ask us — and their employers –tell us a lot about what’s important to them and the information and guidance they need to make the best decisions they can.

With a growing number of full-time employees using OneExchange to find health coverage, we decided to compile the top 10 questions asked during the recent fall enrollment period for the plan year 2015. The questions underscore the obligation that employers and exchange providers have to help employees become more informed consumers and more active participants in their own health care.

Earlier this month, we issued a press release with a list of the top 10 questions and what they reveal about employees’ concerns.

Click here to read the full release.

Last month, both the House of Representatives and the new Republican-controlled Senate introduced legislation that would change the definition of a full-time employee under the Patient Protection and Affordable Care Act (ACA) from 30 to 40 hours per week. The House version of the bill passed on January 8, 2015. The Senate version has been referred the Finance Committee.

The stakes are high. The ACA’s employer mandate now requires employers with 100 or more full-time employees to provide health insurance that includes a set collection of benefits laid out in the ACA, or pay a penalty. This “pay or play” employer mandate goes into effect for employers with 50 to 100 full-time employees in 2016.

President Obama has promised to veto any bill that walks back provisions of the ACA and this bill in particular. It is unclear that either the House or the Senate could muster the two-thirds vote required in both chambers to override his veto.

Proponents of the bill argue that raising the cutoff for full-time work to 40 hours per week would take pressure off employers and lessen the chances they would cut workers’ hours to under 30 per week to avoid having to provide health insurance.

Opponents argue that employers are more likely to cut hours if the threshold is 40 hours per week, putting many workers in the 35 to 39 hours per week range at risk of becoming part time under the law.

The debate will no doubt continue.

However, the 2014 Towers Watson Health Care Changes Ahead Survey offers insight into the focus of U.S. employers’ planned response to the ACA’s employer mandate. Completed in July 2014 by 379 employers that collectively employ 8.7 million people, the survey revealed that 75% of employers plan no changes to their workforce strategy or mix of part-time employees in 2015 or 2016. Moreover, 91% of employers that offer health plans to part-time employees are “not at all likely” to discontinue them in that timeframe.

Ben Lupin, senior regulatory advisor for Towers Watson Health and Group Benefits, cautions employers not to count on the passage of a bill redefining full-time work as 40 hours a week. “The stakes are too high,” says Lupin. “Better to act as if the 30-hour cutoff is set in stone and move forward accordingly. When the option is to ‘pay or play,’ paying a penalty is simply too onerous to consider.”

For additional insights from Lupin on the “pay or play” option, see our blog post on the ACA reporting requirements that went into effect on January 1, 2015, here.

In 2014, nearly three-quarters of employers offered their employees one or more account-based health plans (ABHPs). Another 9 percent expected to add an ABHP to their plan options for the plan year 2015. In addition, 16 percent of employers now offer ABHPs as the only plan option, more than double the rate in 2012. No other plan types saw such positive growth in 2014.

This is according to data from the 19th Annual Towers Watson/NBGH Employer Survey on Purchasing Value in Health Care, fielded in late 2013/early 2014. Respondents included 595 employers that collectively employ 11.3 million full-time employees, have 7.8 million employees enrolled in their health care programs and represent all major industry sectors.

An ABHP is an employer-sponsored health plan that combines a high deductible with either a Health Reimbursement Arrangement (HRA) or Health Savings Account (HSA) – tax-advantaged accounts that employees can use to pay eligible health care expenses. ABHPs help employees increase their understanding of the value of the benefits that their employers provide.

The survey further revealed that in 2014, employee enrollment in ABHPs increased from 15 percent to nearly 33 percent. When offered on a private exchange, uptake was even higher, with 40 to 60 percent of employees enrolling in ADHPs. To make ABHP adoption even more attractive, 79 percent of companies that offer them contribute subsidies for their employees into the tax-advantaged savings accounts the plans are connected to.

However, there is a learning curve that comes with being a newly empowered health care consumer. And the first year of implementing an ABHP can be difficult on employees because it takes time to accumulate funds in the accounts the plans are attached to. In the meantime, employees might have medical expenses that are not covered and exceed the funds in their accounts. Employers looking to adopt ABHPs need to help their employees take a long-term view of these types of plans, beyond year one.

To aid their employees in making the transition to ABHPs, a majority of companies emphasize communication and education throughout the process. For example, 52 percent of employers offering ABHPs have implemented year-long communication strategies on the value and responsibilities of ABHPs. Another 20 percent plan to implement such communications strategies in 2015.

We’re still in the early stages of fitness wearables. For proof, look no further than the new wearables introduced at the Consumer Electronics Show (CES), the tech industry’s biggest trade show held every January in Las Vegas.

Put bluntly, as it was in a recent Bloomberg BusinessWeek article about two of the worst offenders: “The Smart Ring and the Smart Belt Are Actually Kind of Stupid.”

The so-called smart ring, called… wait for it… “Ring,” allows the wearer to turn lights on and off and open and close curtains with a flick of a finger. Kind of like Mary Poppins cleaning the childrens’ bedroom in the song, “A Spoonful of Sugar.”

Belty, the other wearable lampooned in the Bloomberg BusinessWeek article, is a belt that tightens and loosens depending on whether the wearer is sitting or standing. It also vibrates if the wearer has been sitting for too long.

While we might not rush to judgment that these products are “stupid,” they do reflect a basic theme of recent wearable unveilings: The technology is here; the utility, not so much. For those old enough to remember, or fans of old TV, just think the 1960s TV show “The Jetsons.”

For those unfamiliar with it, The Jetsons featured a decidedly-retro futuristic family: George and Jane, their children, Judy and Elmo, and of course, Astro, the family dog. The technology in the show is kitschy and entertaining — outlandish by design. Remember the auto-hygiene machines and treadmills floating in space?

But if fitness wearables are going to become widely accepted as key components of employer-sponsored wellness programs, they’re going to have to stay fun while getting a whole lot more functional. As we wrote in our previous posts on fitness apps and the challenge of pinning down ROI for wellness programs, there are still many obstacles to successfully implementing wellness programs and getting the most out of wearable health devices.

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Towers Watson announced today that Time Inc. has chosen Towers Watson’s OneExchange to deliver medical, prescription drug, dental, and vision benefits to its full-time active employees and their dependents for the 2015 plan year.

Time Inc. also added a new voluntary wellness program to give employees and dependents the opportunity to earn “well-being dollars.” Plan participants will have options in medical plans, as well as medical, dental, and vision insurers to choose from.

Said Jim Foreman, managing director, Exchange Solutions, Towers Watson, “Time Inc. is at the vanguard of a movement among the country’s leading employers to give their employees more choice and control over their health and wellness benefits. By using a private exchange to administer and deliver these benefits, Time Inc. is bringing the same spirit of innovation it demonstrates in its media business to helping its employees become better and more responsible consumers of health care.”

For the full release, click here.

Accountable Care Organizations (ACOs) have been making headlines as a relatively new option for reducing health care costs. ACOs do this by forming regional or local groups of medical providers — doctors, hospitals, clinics — who provide coordinated health care.

This coordination is designed to result in higher quality of care for patients by increasing communication between specialists, primary care providers, and other caregivers. It also can lower the cost of care by reducing duplicate tests and catching conditions early that, if left untreated, could develop into more costly chronic diseases.

As an incentive to form ACOs, the Centers for Medicare and Medicaid Services (CMS) shares the savings achieved for the Medicare program with ACOs that succeed in delivering high-quality care at a lower cost.

Since ACOs were authorized in 2010, nearly 400 have been formed. However, in the only analysis of results by CMS thus far, just 29 ACOs qualified for the bonus pay. Still, the payouts are impressive. As a chart published in CFO Magazine in December 2014 shows, the top bonus was $57.8 million with bonuses paid to the second- through fifteenth-ranked ACOs ranging from $39.6 million to $15.1 million.


These figures underscore both how difficult it is to improve health outcomes while reducing costs and the promise of ACOs as one method for doing so.

ACOs are not the only new policies Medicare has introduced to encourage coordinated care, however. In October 2014, Medicare introduced a policy that would reimburse doctors for providing coordinated care to Medicare-recipients with chronic conditions. In January 2015, the Obama administration announced its goals of having 30 percent of payments for traditional Medicare benefits tied to alternative payment models such as ACOs by the end of 2016 and 50 percent by the end of 2018.


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