Businesses, Not the Government, Still Steer Healthcare Innovation

During World War II, federally imposed controls prohibited employers from raising wages to attract workers, but the War Labor Board at that time decided that “fringe” benefits, such as health insurance, didn’t count as wages. And that was the rise of employer-sponsored health insurance as we know it today—a way for companies to differentiate themselves and attract talent.

When people ask me how I think healthcare reform will ultimately change the healthcare and health insurance landscape in America, I often think of this and other similar historical examples where when you look back it was employers, not the government, that innovated and drove real change.

We’ve already started seeing sparks of this across the country—organizations redesigning their benefit plans, creating wellness programs, and working to get their employees to think more about their health-related expenses—all in an effort to deal with skyrocketing and unsustainable healthcare costs.

For instance, companies like IBM and Baylor Health Care System now give incentive payments to employees who adopt healthy behaviors. Some organizations like UPS have decided to stop providing health coverage to employees’ spouses. And others—also including Baylor—are no longer hiring smokers.

There are also companies like Sears creating their own private exchanges, and companies like Walmart that have partnered with healthcare providers to drive employees to seek care proven efficient and effective, even if it’s further from home.

For the past few years, while all eyes have been on the decisions coming out of Washington, many of America’s employers have created their own brands of healthcare reform. And that will continue.

So back to the employer-sponsored health insurance model that proliferated more than seven decades ago—are the recently opened health insurance exchanges the beginning of the end to that model? I think not. The American way, employers competing via innovative benefit offerings to stay efficient and attract and retain talent, is as alive today as ever.

Joel Allison is CEO of Baylor Scott & White Health.

Posted in Expert Opinions.