Employee Health Trends 2024: Webinar Highlights

From shifts in benefit utilization to evolving health risks, many patterns and trends are shaping the employee health landscape in 2024. During our recent Employee Health Trends webinar, our experts we covered three of the top insights woven into this year's analysis. If you'd like to jump to a specific trend, use the links below:

• Unmasking the Ongoing Trend Drivers in PMPM and Rx Costs
• Analyzing High-cost Claimants for Actionable Insights
• Empowering Change: Taking Action with Obesity Analysis

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Harnessing Healthcare Trends: Unveiling the Surge in Pharmacy Spend

"Looking back on our book of business since 2020, pharmacy spend has increased almost twice as fast as medical and estimated to be up 11.3% per member per month for 2023. I only say estimated here because we still need a few more months of run out claims for 2023 to be complete. Medical is projected to increase again after being roughly flat last year, up 3.8%. And then overall, we expect the 2023 trend to come in at 5.7%.

As we explore some more of the specific categories driving the most recent trend increase, looking at the hart, on the left side is your PMPM from our prior period, and all the way on the right is the PMPM from the current period, and in the middle are all the components that make up the difference. Those are our trend drivers. Typically when looking at trend drivers, we use our mutually exclusive service classifications to look at what employers are spending their healthcare dollars on.

When looking at these components of trend, we see that the drivers are all about pharmacy spend. We have a full and complete run out claims for the 2022 calendar year shown here, and 2023 data are pretty much the same. So the top three drivers of trend are specialty pharmacy, brand name prescription drugs, and on the medical side, surgical procedures." - Chris Gagen, Senior Director, Analytic and Strategic Consulting

"To round out this section, and with each of the subsequent sections, we have an employer's roadmap. There is much more detail to these road maps and additional action items in the full Employee Health Trends, but we want highlight just a couple pieces here for employers about how you can evaluate and take action:

It's most important to really establish a baseline for your costs. In this particular example, as that relates to both brand name and specialty drugs.

Understand, historically, where that spend is and then where that stands today so that when you're making changes or putting various programs in place, you can track the impact and effects of those particular types of programs.

It's important to understand your PBM contract, but where we really see the greatest impact is by addressing and managing the chronic conditions in your population.

We specifically highlighted diabetes and obesity, but knowing the full makeup of your population is imperative to developing the overall strategy. And, if your members can be better engaged can improve the health, but also the risk and ongoing costs." - Jennifer Jones, Vice President, Strategic Partnerships & Population Health Practice Leader

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Want to know how the demographics of high-cost claimants differ and what you should consider for that? Get the full report.

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Segmenting High-Cost Claimants: Unveiling Insights for Strategic Healthcare Management

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"When looking at high-cost claimants, we decided to divide them into cost buckets, or categories. We did this partially because we know not everyone uses the same definition for high-cost claimants. We also did this because we thought there might be more information we could extract from our analysis by segmenting the high-cost population.

Looking at our charts, in both the bar and the donut charts, the blue includes members in 2022 with total plan paid between $50,000 - $99,000. Yellow represents the same for a$100k - $249K. Orange includes members with plan paid between $250K - $500K, and green represents members with total plan paid of over $500K. Looking at the chart on the left, it's not too surprising that the percentage of members who fall into each of these cost categories has gone up over the last few years, which is consistent with the general trend of increasing costs. The donut chart on the right shows the cost contribution of each of the high cost categories to overall costs, it also includes the members with less than $50,000 in spend in purple.

Here we can see the outsize impact on total spending of the high-cost members, particularly for members with annual spend above $250K, these members represent less than 1 in 500, but they contributed 14% to total cost." - Janet Young, M.D., Clinical Advisor

"As mentioned the earlier, establish your baseline. It's really imperative to understand the demographic makeup of your population, what conditions are driving the spend at various thresholds, and how many remain high cost claimants from year to year. You can use this information to develop your ongoing strategies related to the services that drive the high-cost claims within those various categories.

Whether that's cancer, for example, or other chronic conditions, we suggest that you continue to promote your regular screening exams. Thinking about some of the newer technology that's out there to identify early or more rare cancers, utilizing COEs to help ensure high quality care, or second opinion services to ensure that members are on the right treatment paths.

And then lastly, knowing the facility cost. We saw where even within the highest categories from a cancer perspective, the facility costs were what were driving that threshold, so understanding and using price transparency tools can be useful here as well." - Jennifer Jones, Vice President, Strategic Partnerships & Population Health Practice Leader

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Want to download a copy of the full 2024 Employee Health Trends Report? Click here.

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Rising Rx Spend in Obesity Treatment: Unveiling Opportunities for Strategic Intervention

"Until recently, most of the cost of treatment for obesity has been on the medical side through services aimed at diet and behavioral modification, as well as bariatric surgery for a few members. In the bars in the chart on the left, we see medical spend for obesity treatment in blue and the drug spend in yellow.

We see that only about 15% of spend for obesity treatment was drug related in year one of our study. But since year one of our study period, the average member who is obese has seen an increase in drug spend for obesity go up from $56 to over $300. And this drug spend more than doubled in the last year alone. When we look at what's driving the drug spend, shown in the chart on the right, we find that most of the spending has been for Wegovy, which is approved for obesity treatment, but also for Ozempic, even though obesity is an off label use for that drug.

But despite the large increase, only about 6% of members with obesity are being treated with a GLP 1 agonist, so we can see that there's potential for a lot more Rx spend in the future." - Janet Young, M.D., Clinical Advisor

"As we think about the roadmap items and understanding and setting a baseline here, we also look at obesity as a whole – but how do you approach that? It's typically, as you mentioned, Janet, thought about and addressed initially with nutrition and physical activity types of programs. And oftentimes, it's very common to cover bariatric surgery, but I think it's really time to take stock and understand what you have in place, how that has worked for you in treating obesity, and evaluate your strategy.

Holistically, consider all treatments for obesity, knowing that they can be very individualized. And, think about what support is in place to ensure the success of the various treatments and modalities, everything from lifestyle changes to medication, to surgery as well. And ultimately how will that all affect comorbidities too.  

Our next piece to our roadmap is treatments through GLP 1s and thinking about the future cost savings that could be associated with that. From there, our next step from an analysis standpoint is to understand the impact of potential cost savings of members that are on GLP 1s and thinking about what their cost was prior to the GLP 1, current, and then again from a future standpoint, do we see where there's some cost savings there." - Jennifer Jones, Vice President, Strategic Partnerships & Population Health Practice Leader

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Want to know how obese members vary by demographic andwhat you should consider for that? Get the full report.