Benefits advisors’ point solution fatigue: Is there a cure?
The explosion of self-funding is forcing benefits consultants to deliver best-in-class solutions for every claims category, resulting in a whole new phenomenon: point solution fatigue.
My travels across our sales territories this year have confirmed this seismic shift. In large cities once hesitant to adopt self-funding in the mid-market, employers as small as 200 lives are now taking the plunge. It’s clear that traditional health insurance models are buckling under the pressure and this massive shift presents a new set of challenges for benefits consultants:
- Managing an overwhelming number of point solutions tailored to the unique needs of each client
- Mounting pressure to adopt more creative vendor strategies
Self-funding offers employers tighter control over cash flow, enhanced data transparency, and flexibility to incorporate more creative program offerings.
This creativity comes via third-party point solutions designed to reduce health care costs and improve health outcomes through tailored intervention and specialized care for a specific health condition (e.g., diabetes, mental health,etc.). As a result, the point solution marketplace has exploded in the past several years as more employers adopt them into their strategy.
This growth in program offerings is forcing benefits consultants to deliver best-in-class solutions for every claims category, resulting in a whole new phenomenon: point solution fatigue.
The realities of point solution fatigue
A crowded lineup of point solution vendors can weaken employee engagement and make calculating a return on investment challenging. Survey results from Willis Towers Watson found that 56% of employers experience low point solution engagement and 41% cite a lack of outcomes measurement to assess value.
Given these challenges, removing point solutions from your clients’ benefits strategy may seem like the best option. But the reality is, you can’t get rid of point solutions and hit your goals. Instead, it’s best to optimize what’s already in place.
Let’s diagnose a few of the top challenges.
Top 4 point solution challenges
1. Access to best-in-class vendors
Smaller groups might not have access to competitive rates or even be able to work with top-tier point solution vendors, as many prefer larger group sizes.
Working with captives offers creativity for smaller groups and access to best-in-class solutions. Another option is leveraging a care navigation platform and tapping into their vendor ecosystem. Most care navigation platforms offer unique contracting capabilities to help smaller groups work with vendors they might not have access to otherwise.
2. Evaluation and implementation
The avalanche of available point solutions makes it difficult to identify and evaluate the best options. Even with time to fully vet solutions, consultants may hesitate to implement a new point solution due to perceived complexity.
Care navigation reduces the burden of vendor management, offering a centralized platform to streamline the process of adding new solutions.
3. Driving engagement
Programs can still be underutilized even when the perfect point solution line-up is in place. This can often be attributed to a general lack of awareness. MetLife’s 2023 Employee Benefit Trends Study found that “about 50% of workers said they wish they were more informed about their company’s total rewards.”
When the responsibility to drive awareness shifts to a care navigation platform, employers can scale engagement with technology and automation. Care navigation platforms leveraging generative AI further boost engagement by tailoring care recommendations based on an employee’s health profile and individual needs.
4. The question of ROI
According to a Willis Towers Watson vendor strategy survey, “ROI is a key metric in evaluating benefits, yet 44% of employers say vendor reporting lacks employer-specific ROI.” Care navigation platforms not only boost engagement, but also provide real-time tracking of performance metrics, such as claims reduction, preventive care uptake, and savings. Ultimately, this gives an employer and their consultant a clear view of ROI.
Embracing a connected approach
Embracing an integrated approach to point solution management is key to containing costs and improving employee health outcomes.
In an increasingly complex health care environment, benefits consultants should seek solutions that integrate vendors, drive engagement to optimize performance and guide informed decision-making around vendor selection.
Justin Holland is CEO and co-founder of HealthJoy.