Twenty large companies are joining forces in an effort to stabilize the cost of providing employees with healthcare benefits, according to The Wall Street Journal.
The newly formed cadre of companies, called the Health Transformation Alliance, includes major U.S. companies such as American Express, Macy's and Verizon Communications. The 20 companies cover a collective four million people.
They plan to share data and information about employee health spending and outcomes with the ultimate goal of using findings to better inform how they contract for employee healthcare.
Here are five things to know about the new alliance, according to WSJ.
1. Participants in the new group said they hope other companies will ultimately sign on to their effort to control the costs of employer-sponsored health plans, which cover nearly 170 million Americans. The 20 companies joining the alliance said they are committed to continuing to provide healthcare coverage to their employees, but they must seek a new approach.
"Healthcare is one of the things that employees need and want," said Marc Reed, chief administrative officer of Verizon, according to the report. "What we're trying to do is to make this sustainable so that kind of coverage can continue."
2. An insurance industry official proposed insurers could benefit from backing initiatives like the new alliance, pointing out that insurers also seek increased transparency into healthcare costs and treatment outcomes, according to the report.
3. Under the Health Transformation Alliance, participating companies will begin to aggregate data about provider costs and patients outcomes as early as this year. The alliance is also expected to announce a 2017 pilot project dedicated to controlling costs of prescription drugs, according to the report.
4. Executives at some of the participating companies said they believe it is too early to identify which areas of employees' healthcare will generate the most savings, but several people interviewed by WSJ said they hope the shared data and analysis across the 20 companies could reveal which treatments and healthcare providers showed better outcomes for treating certain conditions and illnesses. In turn, employers would gain a better sense of where to direct employees for high-value healthcare.
5. Some members say they may eventually form a purchasing cooperative to negotiate with payers for lower prices and improve relations with drug benefit managers.
Ultimately, the alliance "could end up morphing into some kind of cooperative where we could use our aggregate scale to purchase these types of services on behalf of our employees," said Mr. Reed, according to the report.