How can benefits advisors filter out marketing hype & misleading metrics?

Following the pandemic-era direct to consumer digital health boom and resulting change in market dynamics, many behavioral health companies are pivoting their business models to sell digital health benefit solutions directly to employers and insurers. In an attempt to battle spiraling health costs, employers and their benefits advisors are increasingly shopping around for better cost savings. But it can be difficult to cut through the clutter to understand which vendor’s ROI and cost savings claims are legit and which are more marketing hype than reality. 

It’s no secret that benefits leaders and advisors are overwhelmed with the options, information and cost-saving claims presented to them. At the same time, they must balance the mounting pressure to directly impact health outcomes and savings while managing a workforce with ever-evolving health needs and benefits expectations. 

Value-based care with performance guarantees is fast becoming table stakes in vendor evaluation and selection, but discerning ROI from marketing hype and misleading metrics can help take the decision-making process to the next level. Let’s take a closer look at how benefits advisors and employers searching for the right solution for their population can quickly and intelligently assess ROI and cost-saving claims. 

True ROI? 

Real-world data (RWD) and real-world evidence (RWE) — including information from medical claims and digital app data — are often used to describe the practical impact of digital health tools on patient health  outcomes and health care delivery. RWD and RWE can demonstrate cost savings and improved patient care, resulting in actual clinical value and patient and clinician benefit. They are also a significant part of presenting an accurate, honest ROI calculation for behavioral health technology.

With a shift toward market consolidation and a “one-size-fits-all” approach to employee benefits, we’re increasingly finding that many employee assistance programs (EAPs) and behavioral health providers start with a conclusion, such as achieving a 2.5x ROI, and then work backwards from that conclusion, matching the data to achieve a strong enough ROI. They also mask their true ROI by excluding subscription per-employee-per-month fees and/or behavioral health claims, thereby inaccurately representing the true cost of the program. This understandably creates challenges for benefits leaders and brokers trying to decode the ingredients that went into that ROI recipe. However, with a quick understanding of what’s behind ROI claims and by asking the right questions, benefits leaders can take a more strategic and efficient approach to vetting ROI claims for accuracy and honesty. 

Following are three key elements that go into an accurate ROI, and four critical questions that benefits leaders can ask. 

3 pillars of true ROI

ROI rests on three pillars of truth. Once they are established, an organization can confidently know that what is being reported is real. The three pillars of true ROI are: 1) honest communication of the population that the ROI study, validation, or certification is based upon; 2) discrepancy-free reporting; and 3) the inclusion of all medical/health care claims sources. 

1. When a study population is clearly defined and honestly communicated, it means that: 

• The diagnoses the study’s results pertain to are clearly defined 
• The study’s inclusion criteria reflect real-world conditions in which people seek and receive care – without selectively choosing participants 

2. When the bottom-line ROI reported is discrepancy-free, it means that it: 

• Includes all costs, including all program fees and all therapy sessions 
• Costs exceeding provider coverage are accounted for 
• Savings attributed to non-behavioral health medical conditions are thoroughly explained

3. When the ROI analysis includes all claims sources, it means:

• All medical claims and mental illness/behavioral health claims are included 
• The analysis accounts for any additional appointments that get billed through a behavioral health plan 

Once we understand these three pillars, there are four final questions that can help dig deeper to weed out unreliable claims.  

1. What diagnoses does your ROI study include/cover? 

An accurate reflection of diagnoses, especially behavioral health conditions such as mental illness and substance use disorders, is critical to understanding what the focus of the reported ROI. Remember, mental health illness versus substance use disorders versus other types of disorders such as behavioral (non-substance-related) addictions are all very different behavioral health conditions. You can further ask: 

• What % of participants in the ROI reporting has each of the diagnoses? 
• What % of your ROI implications can be attributed to each of those diagnoses?

2. How many sessions does the average member need versus the number of sessions required for study participation?

This reinforces the fact that an ROI study, validation, or certification claim should reflect real-world circumstances, and only then can reported ROI reflect the true ROI clients actually receive. You can further ask: 

• How many sessions does the average member require for outcome success?
• How many sessions are required to participate in the study?
• How many sessions per member do you account for in your calculation?

3. Are there any other underlying discrepancies or misleading calculations that result in unrealistic ROI scenarios? 

ROI calculations can be complex, which means they can often be manipulated to show more favorable results. You can further ask:

• Are both medical and behavioral health claims included in your ROI calculation? If not, why not; and how did this impact the final ROI calculation?
• Do you include all individuals enrolled in the program, regardless of their level of participation?
• Are all therapy/treatment/coaching session fees included in the ROI calculation, or just base program fees?

4. Did you pay for an “independent and objective” third-party validation of your ROI? 

While it’s not unusual for vendors to enlist consultants or organizations to validate or certify their ROI, disclosure and transparency is critical. Simply put, a behavioral health provider, vendor, or EAP should disclose if it is paying for a 3rd-party ROI study, validation or certification. Not doing so fails to disclose a potential conflict of interest. 

Given the complexity of health care delivery and the diverse stakeholders involved, understanding true ROI is critical in benefits decision making. Following a few simple steps and strategic questions can help give benefits leaders and brokers the confidence that provider, vendor and EAP claims are connected to real-world outcomes. This helps them better understand a program’s ROI claims and impact on medical care costs and utilization. 

Yusuf Sherwani, M.D., Co-Founder and CEO, Pelago.