Minnesota Health Action Group2019 Annual Employer Benefits SurveyOverview for Minnesota Cities, Counties and School Districts

The Minnesota Health Action Group Annual Employer Benefits Survey, designed by employers for employers, provides comprehensive health plan benefit benchmarks from Minnesota employers. Now in its ninth year, this custom, confidential, free Survey offers an invaluable view of health care benefits, digging deep into what is and isn't working.

Insights to Guide Strategy and Planning Costs are high and continue to rise. Minnesota cities, counties and school districts (CCSDs) are experiencing an annual health care trend of 9.4% on average (including employer and employee share), far outpacing national averages and trending up. Larger organizations are experiencing lower trend. The majority of employers’ concerns, goals, new programs, and initiatives are aimed at combating health care spend.

Improving workplace mental health a top priority. Many organizations have taken actionto address mental health in the past year, typically related to increasing awareness, decreasing stigma, and enhancing general well-being. Even so, the majority have not taken important steps to understand and address potential non-quantitative treatment limits for mental health care.

Employees value cultures that foster well-being. Over 70% of professional workers say they would not work at a leading company if they had to tolerate a poor workplace culture.* Employers are responding with policies that support cultures of well-being.

Eliminating health care waste is gaining traction. Employers have high hopes of eliminating waste from the health care system. Many are focusing on high-cost, high-prevalence conditions and prescription/specialty drugs as a first step.

Employers are ready for change; employees are not. To meet the needs of an increasingly diverse workforce and keep up with today’s pace of change, employers are ready to make significant health care benefit changes. Most employees are not ready, however, meaning benefit transitions will need to be handled strategically and skillfully.

Benefits reflect diverse employee life journeys. Changes such as enhancing total well-being offerings, adopting and promoting new technology to ease access to care and benefits, and improving price transparency are some of the tactics being used to meet diverse employee needs. While many organizations commonly take a serious look at the newest ideas, an increasing number are no longer content with a wait-and-see approach.

Current Level of Readiness to Make Significant Changes in Health Care Benefits

“It’s really helpful to have the results from cities, counties and school districts broken out from general industry. By offering a clearer view of what peer employers are doing, we can continue offering high-value benefits to our employees.” Sue Hoel, Senior Benefits Analyst, Hennepin County

5 (high) 4 3 2 1

(low)

Top management’s readiness

Employee’s readiness

HR and benefits team’s readiness

12% 45% 24% 10% 10%

6% 10% 42% 24% 18%

17% 52% 17% 4% 10%

This overview was prepared for cities, counties and school districts (CCSDs). A separate summary is available for general industry.

The Survey is open to members and non-members of The Action Group.

Of 108 responding organizations, 53 were CCSDs.

The cities, counties and school districts group represents 51,708 employees, with an average employer size of 976.

* Source: 2018 Workplace Culture Trends Survey, LinkedIn

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2

3

4

5

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ABOUT THE 2019 SURVEY

Highlights from the Survey

Top 2019 Health Care PrioritiesHR and benefits professionals face the reality of competing priorities every day. While controlling overall health care spend is king, there are many area considered to be high priorities.

Improving Workplace Mental Health a Key PriorityFor forward-thinking employers, mental health is a top priority, directly related to business success.

Many organizations have taken action to address mental health in the past year, typically related to increasing awareness, decreasing stigma, and enhancing general well-being.

Despite the fact that mental health parity laws have been in effect at the federal and state levels for more than a decade, few organizations have taken important steps related to vendor management such as:

Conducted an independent compliance assessment with mental health parity

Indemnification from vendor for identified risks associated with mental health non-compliance

4%

4%

Low Emotional Well-being and Stress Affect the Workforce

©Minnesota Health Action Group, 5/19

In addition, Survey results show that most organizations have not yet taken action to address barriers in access to mental health care, and the vast majority of organizations either haven’t considered or don’t know what tools, policies, and payment practices are in place. This points to a significant opportunity for employers to engage with their health plan/pharmacy benefit manager (PBM) to improve mental health coverage, reimbursement and outcomes.

Suboptimal performance

at work/ presenteeism

More absenteeism

Conflict at work No impact

71%62%

56%

16%

Mental health is an important part of the health management strategy over the next two years

The mental health of our employees is directly related to the overall performance of our organization

80%

98%

High Priorities

Ensuring legal compliance 61%

Ensuring the benefit strategy meets the needs of the organization and employees of the future 57%

Improving the population health of employees 67%

Managing high-cost claims 44%

Addressing total employee well-being (e.g., physical, mental, financial…)

51%

Providing a mentally healthy workplace (e.g., reduce stress, increase resiliency, mindfulness...) 56%

Effective contracting with and managing vendors

36%

The Action Group’s exclusive “Working Well in Minnesota” is a tool employers can use to drive change that will lead to achieving long-overdue parity in mental health care. The Mental Health Guiding Coalition is currently convening to take action on improving the mental health care system.

There is a lot of RFP activity for 2020, with 43% of CCSDs going out to bid. Managing costs is the top reason for changing health plans.

Controlling overall spend 86%

Creating newand engaging employee communications

24%

Promote mental health as portion of whole-person well-being

Employers are responding to employee expectations for a healthy workplace culture by having health-related policies in place.

©Minnesota Health Action Group, 5/19

89%

53%

43%47%

29%

Tobacco use Work from home or telework

Workplace bullying

Flextime for personal matters

More absenteeism

Conflict at work No impact

Employers Focusing on Cultures of Well-being

“We prefer to talk about overall well-being, rather than wellness, using the Gallup model. We trace a variety of metrics across five elements including turnover, promotion/transfers, PTO utilization, volunteer time off, learning hours, tuition reimbursement, etc. Our efforts are more around nurturing and enhancing our culture, rather than focusing on weight loss or fitness challenges.”

Anonymous Survey Respondent

The majority of employers are still offering wellness programs, too. Although they see good participation and a boost to their culture, they have not seen the effect on health care costs and have difficulty measuring them. Some 34% of Survey respondents say wellness programs have a high impact on company culture; another 63% say there is some impact.

While addressing total well-being and providing a mentally healthy workplace are high on the priority list for CCSDs, the following chart shows the level of interest for related initiatives.

Other InsightsFor general industry and CCSDs, many key issues are similar, however:• Total health care annual premium cost per employee is

lower for general industry than for public sector. The trend is rising faster for general industry than for CCSDs.

• General industry employers continue to pursue more innovations than those in the public sector. They are also more likely to be self-insured and offer HSAs.

• The full Survey report includes additional comparisons between general industry and CCSDs. (The full Survey report is available to all participants. Those who did not participate in 2019 but would like a copy of the full report may obtain one by committing to taking the Survey in 2020.)

For which of the following do you have a health-related policy?

“Minnesota employers are clearly making employee health a priority, with innovative companies willingly tackling complex issues like mental health and specialty drug utilization. It’s promising to see that 78% of our Survey respondents agree that more employer collaboration is needed. The Action Group is committed to supporting employers in managing their own plans and in working together to influence the health care marketplace.”

Deb Krause, Action Group Vice President

Prioritizing employee health and well-being is crucial to the short- and long-term success of any organization, which includes managing cost and waste often associated with high-prevalence conditions. Providing a path to workforce wellness is a wise and important investment.

Top Five Conditions Addressed by CCSDs

Diabetes Mental Health Cardiovascular Specialty Drug Musculoskeletal

26%23%

15%6%

4%

Despite the fact that diabetes is the top condition CCSDs are focusing on, only 29% have adopted the National Diabetes Prevention Program (DPP), an evidence-based strategy for preventing or delaying progression to type 2 diabetes.

1 1.8

Company policies and practices focusedon whole-person well-being2 3.4

Mitigate organizational stress3 3.6

Improve employee resiliency4 3.8

Build emotional intelligence5 4.3

(1=most interest, 7=least interest)Rank the level of interest of the following activities for your organization

Addressing Waste in the Health Care SystemWaste in the U.S. health care system is estimated to be about one-third of all money spent, or $750 billion. Employers have high hopes of eliminating waste from the system, but have not achieved many results to date. Prescription medications, including specialty drugs, are at the forefront of where employers are working to manage health care waste. Other areas of focus include disease screenings (e.g., Pap tests), medical imaging (e.g., MRIs, X-rays), inpatient monitoring, primary care services, specialty physician referrals, preoperative testing, and clinical testing.

About the Minnesota Health Action GroupThe Minnesota Health Action Group is a coalition of public and private purchasers whose sole purpose is to represent the collective voice of those who write the checks for health care in Minnesota. Action Group members collaborate with community stakeholders to drive innovations that support high-quality health care, create engaged consumers, and ensure the economic vitality of all Minnesota communities. Based in Bloomington, MN, the Minnesota Health Action Group was formed in 1988 as the Buyers Health Care Action Group.

To learn more and to access the Working Well toolkit and Specialty Drug Playbook, visit:www.mnhealthactiongroup.org. Follow on YouTube, LinkedIn and Twitter.

For more information about the Survey or to participate in 2020, please contact Deb Krause (dkrause@mnhealthactiongroup.org)

Recommended Strategies to Reduce Waste*• Ask vendors to share information on health care waste and report on their efforts to address overuse (e.g.,

unnecessary imaging and clinical tests).• Consider value-based benefit design strategies that encourage reduced utilization of low-value services (e.g.,

increasing copays, prior authorizations, steering to efficient providers).• Move toward alternative payment mechanisms that do not reward waste (e.g., bundled payments).

• Engage with the Choosing Wisely® initiative and promote select resources with employees.

* Source: National Alliance of Healthcare Purchaser Coalitions: Uncovering Waste to Drive Innovation, Health and Value in Benefits Design

Considering Innovations to Drive Healthy Workplace Changes

Even with the gap that exists between employers who want to make significant health care benefit changes and employees who are not ready to do so, the dynamic landscape and competing priorities require CCSDs to take a serious look at health care innovations to improve access, affordability and quality of benefits and to build healthy, productive workplaces.

When it comes to benefits, what is the pace of change at your organization?

We take a serious look

at the newest ideas

We don’t jump first, but we’re quick to

follow

Historically slow, but

we’re picking up steam

We’ve always been pretty

slow

27%22%

39%

12%

Prescription Drug Spend and TrendOverall prescription drug trend is 5%, lower than the Mercer benchmark national average of 7%. However, it is concerning that trend for generic and specialty drugs are 20% and 24%, respectively. The top specialty pharmacy drug tactics being used to control costs and utilization are:• Prior authorization for specific drugs from PBM and health plan • Medication therapy management• Step therapy for specific drugs from PBM and health plan• Limit supply/partial fill programs• Analyze costs by condition, by provider, including medical and

prescription specialty drugs• Delay or not cover newly approved drugs

To assist employers in addressing the high cost of specialty drugs, The Action Group’s Specialty Drug Employer Playbook is publicly available