Employers are one of the largest groups that pay for healthcare in the U.S. but often founders do not know how to navigate the employer landscape. We sat down with Tamra Lair to get her thoughts.
Tara Bishop: You’ve been working in healthcare for a long time. When did you start working with employers and what was the employer space like?
Tamra Lair: I began working with employers about 10 years into my career. Prior to that, I did research with and then for the federal government — with what is now called the Agency for Healthcare Research and Quality and for CMS. I was interested in the employer space because some of the outcomes I imagined employers cared about were more challenging to measure and impact — things like productivity and lost time, for example. This was also in the early days of infusing analytics into HR and benefits, so we got to implement creative and innovative ideas, some of which I’m happy to say are now mainstays of benefits and HR consulting.
Tara Bishop: How have you seen employer healthcare, wellness, and benefits evolve?
Tamra Lair: The two most significant macro drivers of change in employer healthcare are underlying healthcare cost trends and the competitiveness of the labor market at any point in time. These are the pressures that HR and benefits professionals are most expected to respond to. Of course, the rise in technology has also created an avalanche of new levers employers can pull to impact the costs and engagement of their workforce. There are also things that cycle with certain employers, such as direct contracting with providers and narrow networks. The various runs at the idea of wellness have also risen and fallen and risen again in terms of popularity. And now, the long-overdue emphasis on equity and mental health has very appropriately seen a surge.
As someone who has tried to emphasize and encourage innovation in employer-sponsored healthcare, because let’s face it, we haven’t figured it out yet, the struggle is that while employers want and need to be innovative, they often require evidence of impact, which is often, by definition, in conflict with being at the leading edge.
Tara Bishop: As a consultant, what did you look for when new programs or offerings came your way?
Tamra Lair: There are a few key questions I’ve always tried to focus on. These are the questions that I think are important to sort through the shiny pennies to find the thoughtful innovation, even among employers who tend to be early adopters.
First, is the solution solving an important and large enough issue in this employer’s population? This is not about focusing on a solution just because the total cost of a particular condition is significant. The employer and the potential solution providers need to make the extra effort to quantify the opportunities associated with poorly or unmanaged cases. Sure, diabetes is always a large expense, but if the majority of those diabetics are doing what they need to do, perhaps the employer needs to identify other more pressing issues.
Second, has the solution provider thought through the complexities of integration, administration, communication, and adoption? Here they don’t need to have done it all or figured it all out, but I want to see that they proactively recognize the complexities and realities employers face and have a tangible plan to address them..
Third, does the solution have a thoughtful and meaningful approach to monitoring progress and measuring impact? Again, they don’t need to have all the answers and data (otherwise the solution wouldn’t be all that “new”), but they do need to have a concrete plan to assess performance in ways that are meaningful to employer buyers, along with a commitment to honest delivery.
Tara Bishop: Moving forward, how do you see employer healthcare and benefits changing in the future?
Tamra Lair: I think the biggest changes are (or should be) at the interface of the supply and demand sides of healthcare. There will continue to be massive changes in care delivery, particularly as a result of virtual care and, unfortunately, provider consolidation. As such, innovative alternatives in the supply and payment of care will hopefully have a meaningful impact. Also, for the last 10 years, it seems we have overly drifted toward expecting the consumer to drive all of the change. I think more employers should consider the adoption of reference-based pricing, centers of excellence, narrower networks, and episode or other capitation models of payment. Employers will need to take more risks than they’ve been accustomed to, to really move the needle. These decisions should also be made with better data.
Tara Bishop: Do you have any advice for start-up founders who want to develop and sell a product to employers?
Tamra Lair: Fully understand the problem your solution is solving, sweat over your buyers’ details, respect your prospects and the issues they face, and analyze your promise and performance way earlier than you normally do.
Tara Bishop: Let’s shift gears a bit-your LinkedIn profile says that clear-eyed analytics can help transform healthcare. What do you mean by that?
Tamra Lair: Clear-eyed is the key. We need to ask ourselves hard questions about the problems we’re trying to solve as well as the impact our solutions are having. And we need to be truly honest about what we learn. That said, it’s also important to resist the urge to keep analyzing the data because you don’t like the answer. We are solving big issues, so finding the right level of grain in terms of understanding the problem and evaluating a solution’s impact is difficult. Spinning on analysis until the right answer pops out is an urge we need to resist.
Tara Bishop: What things should start-ups think about concerning analytics and product evaluation?
Tamra Lair: There are two major things I strongly urge start-ups to consider.
First, it’s never too early to think about building a capability around performance analytics-a function that has a broad mandate to do the clear-eyed analytics we spoke about earlier. This function should be accountable for building performance plans that will, over time, give feedback to product development, operations, marketing, sales, and clients. The second thing is that this type of function needs to start with the key questions and expectations about product performance and not with what data is laying around. It is so easy to lose discipline around what data the organization should look at. And it’s also easy to lack clarity around the data readiness priorities. That would mean the tail was wagging the dog.
Tara Bishop: Any tips for a start-up that is just starting to build this capability?
Tamra Lair: If you start with and prioritize a ton of clarity on the solution’s business commitments to its customers and build from there (as opposed to starting with the data or the tech), you should be in good shape.
This article was originally published on Medium.