Evidence-Based Benefit Design: Toward a Sustainable Health Care Future for Employers

Abstract

Health care costs for employers are rising much faster than inflation. The common approach to health benefit design of increasing cost sharing has failed to contain costs. Some employers, however, have been successful at mitigating the cost trend or actually reducing health care costs. These employers have in common a dedication to data analysis, a search for cost drivers, and a willingness to adjust their approach to health benefit design to address these cost drivers. This approach has much in common with the movement in clinical practice toward evidence-based medicine. We propose that employers adopt a similar approach toward health benefits termed evidence-based benefit design, which is based on a health and productivity framework focused on direct and indirect costs. Evidence-based benefit design incorporates the relevant literature and employer-specific data that are integrated and regularly analyzed.