To all the CHROs and heads of benefits: health care costs may be up more than 20 percent next year. With inflation and cost of living hitting 40-year highs, it’s only a matter of time before you see the change in the medical trend rate for 2023 or 2024! A few months ago, I published an article that showed that the medical trend typically ran 2X the inflation rate. Taking that into account, we can all see the writing on the wall…
We have noticed that PricewaterhouseCoopers, which typically publishes its medical trend in June, hasn’t published it yet. It’s reported that there are discussions on whether it will be published at all. If the rates we are hearing from our clients are any indication, I can see why. We are hearing medical trends being quoted in the high teens to low 20 percent range for next year.
We see a major shift in clients seeking to get control of their data to make sure they are doing everything they can to control cost. Inflation is hitting companies hard and skyrocketing healthcare costs are upon us. With rates projected this high, it will be a double hit for employers and employees. What are you doing to stop rising costs? Employers are adjusting for next year and beyond. They are shifting their mindset from “should I do this?” to “how quickly can we get this implemented so we can minimize the healthcare increase our actuaries are telling us we need?”
The scary part is, according to a recent Health System Tracker article, inflation has yet to fully impact companies. For many employers, the decision will be how to minimize the burden of cost to both the company and employees. Cutting benefits is not the answer when we are still in a tight labor market. If a sizable increase is passed along to employees, they will ask for pay increases. Make sure you are one of the few companies to minimize the cost increase of your healthcare plan. How can you do this? Let 4C Digital Health help you.
4C offers self-insured employers independent oversight of healthcare expenditures. Using powerful analytical tools, our clients gain unprecedented control and insight into their health plan. 4C can answer “what is in my healthcare data?” and “is what I am being charged accurate? 4C provides a robust healthcare data infrastructure that gives employers the capability to have a true digital health strategy. Components of this strategy include a complete suite of solutions that includes Data Supervision, Financial & Operational Controls, and Utilization & Clinical Outcomes. With these solutions comes a full suite of reports that allow employers to track both financial findings, spend analysis and a data warehouse. This allows an employer to have all of their healthcare data in one place with a fully independent view of what’s happening. These controls and solutions allow our clients to save between 8% to 12% on their annual healthcare spend.
With the Consolidated Appropriations Act in place, 4C can determine if your plan is in compliance with the new regulations. This legislation has significant implications for employer-sponsored health plans. Don’t fall behind and be left vulnerable to liability or miss out on the immense value that the new legislation provides. The CAA also removes gag clauses making it easier to own your data. Fully comply with CAA regulations while driving value for you and your members with our help by taking advantage of this risk-free opportunity.
Times like these are difficult, but can be your time to shine as a CHRO. I can help you moderate this cost impact while preserving your benefit programs. We can work together to help you become a world-class CHRO. Whether this is responding proactively to external trends or creating a digital strategy for your company, we have you covered. Reach out today and learn how 4C Digital Health can make you a CHRO hero.
Written By:
George Murphy
SVP Strategic Relations
Overall Inflation Has Not Yet Flowed Through to the Health Sector