Employer Clinic, Employer Health Benefits

Strategic Rx Stewardship: We Can Influence Costs and Outcomes

Week 12 – R X S T E W A R D S H I P


Why do we offer health benefits, or any benefit? It’s really quite simple, we want the healthiest, happiest, and most productive employees showing up each and every day. Sadly, most of the conversation around health benefits these days is centered on the shifting of costs, the restriction of options, the poor results, and the resulting pressure to decrease what we’re offering.

As employers, the message we’re receiving is: “brace yourself, costs are increasing, and there is little you can do about it.” Meanwhile, overall health outcomes continue to slide, we struggle to attract and retain employees, and the feeling of powerlessness grows. Through this process, we’re discovering that there is more at stake than the maddening acceleration of costs; in many cases, the benefits we’re providing are not helping our employees thrive or be their best.

So, why do we offer health benefits? Yes, we want employees to thrive and, yes, we want to attract and retain great people. However, if we take a bit deeper look at the “why” of our benefits, we discover that those benefits are born of our desire to influence the circumstances surrounding our employees health that cause them to thrive, to show up, and to stay. In this way, our health benefits are a lever we pull hoping to get the results for which we are aiming.

The problem is that the big lever we call “health benefits” is not producing the results we desire, and even worse, it is continuing to cost us more. Nowhere is this more evident than in the world of drug costs; a world in which costs are rising very, very, quickly. Enter the concept of Strategic Rx Stewardship, the idea that we can turn those drug costs into an investment by stepping beyond the restrictive and opaque world of out traditional pharmacy benefit and stewarding those Rx dollars in a way that actually reduces healthcare costs and improves the health outcomes of our employees.

The truth is, you, as a self-funded employer, have far more influence than you think. You have many, many choices. This is the case for broader medical care as well as the pharmacy benefit side of the equation. For purposes of this post, I’ll outline the conceptual framework for a model of stewardship that, fully implemented, takes us far beyond what is typically being done to influence costs and outcomes today. This post will introduce a framework, the next post in this series will focus on partnering for good stewardship.

The great news for those of us wrestling with healthcare costs and outcomes is that there are many opportunities. The Strategic Rx Stewardship framework is a process of identifying the opportunities, acting upon those opportunities, and then monitoring the ongoing effectiveness of those actions. Employee health is a long, continuous game. We must approach it that way to begin to win. Strategic Rx Stewardship is comprised of three broad elements: Insight, Influence, and Impact.


The way forward begins with finding insights hidden in the data telling the health cost and outcome story of our employees. First, we’ve got to have timely visibility on all of our relevant data. Ideally, we can see it in real-time if we want. Our goal is to find opportunities and react to them so timeliness is critical. Great, now we can see it, however, that is not enough. We need to understand what we’re seeing. What does it mean?

Two key problems we see with the data provided today are timeliness and volume. Access to the right data at the right time provides the first opportunity: actionable insights. The right data at the right time and in the right amount enables us to find challenges on which we can take action. Now, we have to build a plan to act upon those insights. This takes us to the second element of the framework: Influence.


Influence is the operative word. As good stewards of company resources and of our employees’ well being, we want to find ways to positively influence healthcare costs and outcomes. Why do companies turn to self-funded plans? Because we think we can manage it more cost effectively than fully insured plans; we self-fund to better influence costs and outcomes. The first step centers on access; access to care and access to medications. Employer-sponsored health centers are a powerful point of access and influence on medical costs as well as drug costs.

Strategic Rx Stewardship leverages health centers with Rx at the point-of-care as well as home delivery of prescriptions. This can be done alongside traditional pharmacy benefit options as a first step. However, traditional PBM’s are typically a big part of the cost problem. As employers, we absorb 25-30% cost premiums on our overall spend for the privilege of working with the big PBMs. Yes, this is another opportunity. For now, we’re focused on influence through access. Point of care and home delivery are great access points from a cost-savings and medication adherence perspective.

Access is of little help without engagement. We may provide opportunities for our employees to thrive but they are not always interested or motivated to act upon them. Wellness programs aimed broadly at diverse employee populations are notoriously ineffective at fostering meaningful change in the aggregate. As a framework for influence, Strategic Rx Stewardship focuses on high cost groups first, engaging employees wrestling with chronic disease with programs that leverage Rx cost savings and easy access. Programmatically engaging and managing patients enables us to prioritize efforts, focus our Rx investment, and actually influence better health results…which bring lower costs.

The last piece of the influence puzzle centers on empowerment. Empowering employees with the tools to navigate the benefit that is available to them, participate in the programs in which they are enrolled, access resources to answer questions or give guidance, and participate in their health journey in new and more meaningful ways. The same tools bring healthcare providers into the mix so that patient and provider operate from a shared understanding. Yes, this is available and is another opportunity.


The last element of Strategic Rx Stewardship is about Impact. Impact starts by measuring how we’re doing in our efforts to impact costs and outcomes. Knowledge is knowing what can be measured but we really need wisdom. Wisdom is knowing what should be measured. Our goal is to measure what is meaningful and ultimately point toward our earlier opportunities: actionable insights.

Once we know what to measure, we need to implement mechanisms for ongoing monitoring. Are our efforts working? How well? Is it enough? Monitoring provides rapid feedback so that we can actually respond to what is happening. We don’t want to wait until the end of the quarter or the year. We may want to act next month. Now we begin to see the pattern. Insight, influence, and impact create a virtuous circle bringing us greater opportunities to influence costs and outcomes.

We’ve measured and monitored, now we must adjust. The long game of employee health is iterative and evolutionary. More art than science. Yes, we know the inputs and the outputs, what drugs provide what benefits, however, the program must evolve along with the patients it is designed to benefit. Our ultimate impact, and success, will depend on our ability to iterate through the effective, and ineffective, ideas we implement.

We’re all looking for the right levers to pull or the right buttons to push. Wouldn’t it be nice if there was a silver bullet to slay the evil werewolf of rising healthcare costs and declining health outcomes? The problems are complex and the solutions need to be sophisticated, practical, and affordable. That doesn’t mean they have to be complicated. Perhaps that’s a concept for a future post.

Ultimately, Strategic Rx Stewardship is a categorically different want to approach the money you spend on pharmacy for your employees. An approach that is based in the science of data, medicine, and pharmacology. However, it is also an approach built on the art of proven program management, process improvement, and the nimbleness necessary to adjust to incredibly dynamic circumstances. There is no easy button, one-lever, solution, however, there is now a powerful option for sophisticated groups demanding more and willing to roll up their sleeves in a collaborative approach to influence healthcare costs and employee health outcomes.

Stay tuned.

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