【正文】 inflation ? Advances in medical technology likely to lead to higher costs, difficult decisions ? Legislative uncertainty ? Consolidating medical delivery and financing system ? An aging workforce ? Increased longevity ? Slowing economy ? Disappearing overfunded pension plans ? Few, if any, obvious and easy alternatives to managing health care costs 19 Mercer Human Resource Consulting Employer Outlook ? Environmental outlook spurring employer action – Employers acutely aware of trends ? Heightened interest in cost saving strategies (active and retiree) ? Greater emphasis on longer term cost projections and on the “bottom line” ? Projection results have induced “fight or flight” responses 20 Mercer Human Resource Consulting Retiree Medical Coverage Employers continue to drop retiree medical coverage 29%40%46%43%41%38%36%35%31%23%35%40%31%33%30%40%28%24%051015202530354045501993 1994 1995 1996 1997 1998 1999 2023 2023P r e M e d i c a r eM e d i c a r e E l i g i b l ePercentage of Employers Offering Coverage to Future Retirees Based on employers of 500 or more lives responding to the 2023 Mercer/Foster Higgins Survey of EmployerSponsored Health Plans ? When coverage is offered, retiree premiums and outofpocket costs often increase 21 Mercer Human Resource Consulting Agenda ? The Environment ? The Catch22 ? Paths Away from Traditional Delivery: Two Camps ? Opportunities Along Path 2 ? The Answer ? Additional Topics 22 Mercer Human Resource Consulting The Catch22 ? Reducing employer cost typically implies increasing employee/retiree cost ? Eventually runs against employer’s sensibilities regarding fairness, paternalism (if present), and the concept of benefits generally ? Example (FAS 106): “Lower my liabilities significantly but don’t do anything harsh to our retirees…they won’t accept it” – To the extent that retirees represent the bulk of the liability, this is a very difficult proposition – Opportunities exist to change eligibility, design , etc. for future retirees ? If we don’t take cost out of the system, either the employer or the employees/retirees will pay the increases 23 Mercer Human Resource Consulting Agenda ? The Environment ? The Catch22 ? Paths Away from Traditional Delivery: Two Camps ? Opportunities Along Path 2 ? The Answer ? Additional Topics 24 Mercer Human Resource Consulting Paths Away from Traditional Delivery: Two Camps ? Employers that bee more involved in – Changing employee behavior – Changing provider behavior – Changing providers that they work with – Changing the laws ? Employers that reduce their involvement by – Increasing employee responsibility – Limiting employer cost – Limiting employer risk 25 Mercer Human Resource Consulting Employers Being More Involved ? Collective Purchasing ? High Performance Networks ? Direct Contracting ? Consumer Accountability ? Leap Frog ? Lobbying ? Disease Management/Preventive Care ? What these approaches share is an eye toward reducing cost from the employer’s system, and in some cases, the entire health care system. 26 Mercer Human Resource Consulting Collective Purchasing Use employer and plan manager clout to negotiate favorable payment arrangements ? Background – Traditional work negotiations are volume driven ? Approaches to achieve lower costs include – Aggregated purchasing to improve negotiating strength ? Coalitions ? Formal alliances ? Informal alliances – Directing care to most costeffective source of quality care – Reviewing effectiveness, efficiency and “fit” of current vendor relationships。 employer contributions are taxfree to the retiree and deductible for employer under Sections 105, 106 and 162 of IRC ? Can be funded or unfunded ? For Medicareeligible, Medicare+Choice, Medigap and traditional Medicare available。 $5/month/year of service for 20 years of service) – Fixed or increases annually。 amount not used can be carried over or not ? Aggregate (“l(fā)ump sum”) promise – Employer promise is onetime credit (., $30,000。 accounts earn interest (., at Tbill rate) or not。 ends when fund exhausted), or “l(fā)ump sum” is converted to an annuity (multiple options) 39 Mercer Human Resource Consulting Reimbursement Plans ? Employer often requires submission of receipts for health care expenditures – Premiums – OutofPocket costs ? Typically defined with a maximum reimbursable limit (. $75/month) ? Most mon is reimbursement (or prepayment) of Medicare Part B premium for Medicare eligible retirees – Current cost $ per month with moderate yeartoyear trends – Employer motivated to ensure Part B in effect for Medicareeligible retirees – Part D reimbursement may bee popular ? Employer achieving – Escape from plan sponsorship (for whichever segment of his population the plan applies to) – Fixed costs。 liabilities approximately 189。 employee pays the remainder. % for Benchmark。 the employee pays the balance in cost. Pure DC Employer pays $Z per employee. Employee must pay balance for whatever plan is picked. The employer contribution is not tied directly to the cost of any plan. Employer Contribution Level DC Health Plans % of Cost No Contribution (wages only) % for Benchmark Plans。 Ohio Medicare SelectC: $94 54 Mercer Human Resource Consulting Agenda ? The Environment ? The Catch22 ? Paths Away from Traditional Delivery: Two Camps ? Opportunities Along Path 2 ? The Answer ? Additional Topics 55 Mercer Human Resource Consulting The Answer ? Yes, it may be time for employers to consider new approaches ? But which direction are your clients heading? ? Standing still is likely not an option 56 Mercer Human Resource