Buck Bond Group

Understanding the Past, Building the Future: Health Care

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As we continue to celebrate our 100th anniversary, we went to our consulting practice leaders and asked them three questions:

  • How have things changed in their fields in the past 100 years?
  • What are the biggest challenges they – and their clients – are about to face?
  • What’s the most exciting thing they speculate is coming along?

This post looks at those questions through the eyes of our Health consulting practice leaders around the world. Here’s what they told us.

United Kingdom

(by Anne-Marie Ayre, with Simon Crew)

From friendly societies to penicillin

Anne-Marie Ayre

“As governments become less important in provision of global health care and well-being, employees will look increasingly to employers for support and assistance to ensure health and well-being.”
Anne-Marie Ayre, Head of Health & Productivity, Corporate Solutions, London

The employee health care landscape is unrecognisable from 100 years ago. Advances in medical practices have led to a revolution in personal health care, and average life expectancy has increased from 54 to 81.50. In 1915, 50% of children in the UK aged between 5 and 9 died from infectious diseases; now, with advances in medicine and introduction of the NHS, these figures have reduced to negligible amounts.

In early part of the twentieth century the vast majority of employees only had access to medical services via industry-related “friendly societies” (shipbuilders, steelworkers, railwaymen, etc. – these are still in existence as the modern day Health Cash Plan), and this remained the situation until the formation of the NHS in 1948.

One of the most important changes in health care over the past 100 years was the accidental discovery of penicillin by Alexander Fleming (1928) and the subsequent antibiotic revolution. The irony of this discovery is the current rise in antibiotic resistant bacteria due to our overuse and over reliance on antibiotics (In May 2016 the first patient was identified with a bacteria infectious resistant to Colistin, the antibiotic of last resort).

Double vision 

The next 20 years in health and wellness will go one of two ways – or somewhere in-between.

The first vision is based upon some apocalyptic predictions which will make even the most optimistic individual doubt our future:

  • Aging population; 36% increase in population in next 30 years and doubling of those aged over 75
  • Growing obesity rates; obesity prevalence has increased from 15% to 26% in last 20 years and direct costs to NHS will double from current £5 billion by 2050
  • Increasing costs for chronic disease management; healthy life expectancy is increasing however those living with chronic disease will continue to increase
  • Antibiotic resistant ‘superbugs’; the British Government recently reported that the decline in effectiveness of antibiotics and rise in ‘superbugs’ will lead to someone dying every 3 seconds in the year 2050.

The second vision is based upon technological advances that will revolutionise the workplace and employee health:

  • Nano-biotechnological developments will allow for live streaming biometrics and immediate diagnostics via under skin implants
  • Virtual GP services will be developed to the stage of AI systems with ability to diagnose, source remedies and arrange for automatic delivery of prescriptions.
  • Genome engineering will result in a Huxley-like world where genetics are manipulated pre-birth to determine physical and mental attributes as well as removing the risk of hereditary genetic diseases.
  • Improved health care provision will result in increased longevity with average life expectancy in excess of 90, albeit healthy life expectancy will remain in the 60’s due to increase in lifestyle related chronic diseases.

The future will realistically be a combination of the two scenarios with the employee benefit proposition altering accordingly. Improved health care provision and the resulting increased life expectancy will mean the concept of retirement will become irrelevant as people work into their 70’s and 80’s. Employers will become even more responsible for employees as chronic disease management makes the NHS unable to deliver service to all.

New products will be needed to provide cover past current age limits, especially in health care where insurers do not cover chronic conditions.

There will be a much greater focus on prevention in earlier years to prevent diseases in later life. Employers and Governments will have to implement stick rather than carrot approach.

An ounce of prevention

The most exciting change to happen in employee health and wellness over the next few years will be the wholesale recognition that investment in prevention is better than an investment in a cure. Redistribution of resources from insurance to wellness and prevention will result in changes in the market led by the employee/employer rather than the insurer/provider. Globalisation will continue at its current pace and the cultural differences between workforces will reduce, resulting in truly global application of employee benefits recognising that prevention is identical in every location.

Improved technology and digitalisation of health care provision will allow greater communication and engagement with employees around the globe, providing employers with live streaming data on absence, engagement, productivity and health of workforce. Employees will benefit from up-to-date information on physical and mental health, with more options and support to improve.

As governments become less important in providing global health care and well-being, employees will look increasingly to employers for support and assistance to ensure health and well-being


(by Lizann Reitmeier)

The move to “free” health care

“The most exciting thing is the number of diseases that will be cured and eradicated, not just treated, in the future.” Lizann Reitmeier, Health Practice Leader, Toronto

“The most exciting thing is the number of diseases that will be cured and eradicated, not just treated, in the future.”
Lizann Reitmeier, Health Practice Leader, Toronto

A hundred years ago, Canada was a young country with a population of about eight million. They were divided almost evenly between urban and rural dwellers. Many widespread illnesses went undiagnosed previous to 1916; however, when Canada pledged a force of 500,000 to the effort of World War One, the prevalence of illnesses such as undiagnosed tuberculosis became a concern. Many different factors combined around this time to highlight the weaknesses in health care in Canada. Soldiers were returning from the war with injuries, an explosion in Halifax harbor killed almost 2,000 people and injured another 9,000 and influenza swept across the country, killing thousands. These were serious setbacks to the growth of Canada.

From this, over the next few decades came a focus on improving the health of Canadians, through better access to medical care for all, especially new mothers, babies and recent immigrants. But it became apparent that many people were electing to not seek medical care as they could not afford to pay for the services of doctors (and, as technology advanced, the expensive diagnostics such as x-rays), the discussion of a national health care program began. And then came the Depression and World War Two. These both highlighted the need for a health care program and pushed it further along the government’s agenda.

In 1947, the province of Saskatchewan launched public hospital care which eventually spread across the country and grew into the first nationalized public health care plan in 1957 and was adopted by all provinces by 1961. The Canadian government subsequently expanded this policy to universal health care with the Medical Care Act in 1966. The Act has been revised several times, most recently in 1984, with the Canada Health Act. The act specifies the following principles for public health care in Canada:

  1. Universality: all eligible residents are entitled to public health insurance coverage on uniform terms and conditions;
  2. Portability: coverage for insured services must be maintained when an insured person moves or travels within Canada or travels outside the country
  3. Public administration: the health insurance plan of a province or territory must be administered on a non-profit basis by a public authority
  4. Accessibility: reasonable access by insured persons to medically necessary hospital and physician services must not be impeded by financial or other barriers
  5. Comprehensiveness: all medically necessary services provided by hospitals and doctors must be insured.

The act bans user fees and extra billing by physicians. Strangely, while the Canada Health Act is federal legislation, health care is actually administered provincially, with each provinces allocating and administering the funds transferred from the federal government. While all physicians’ care and hospitalization costs are covered under the provincial plan, each province has the discretion to determine what else is covered. Coverage for some services, such as paramedical practitioners and some diagnostic testing, varies by province.

This is the single most important development in health care benefits in Canada in the past 100 years, as it influences the health of the employee population, increasing longevity and reducing illness. It limits the scope of benefits offered by insurance carriers and provided by employers, and it reduces employees’ reliance on employers to ensure a level of income or protection to cover unforeseen medical emergencies. It also encourages an entitlement mentality in Canadians. Medical care is generally viewed as free, so employees place little value on health insurance.

The Rx for change

When I think back on what has changed in the past 20 years to help formulate my vision of the future, I realize much has improved. Many diseases that were terminal 20 years ago, particularly cancers and HIV, are now treatable and some are even curable. These have presented a new challenge to plan sponsors, insurers and employees alike: The majority of new treatments are drugs that are being introduced to the market with a very high price tag. Drugs are not covered under public health plans.

This cost shift is a new paradigm for Canadian employers. As more new drugs hit the Canadian market with high price tags, employers will have no choice but to reassess the benefits they offer in light of sustainability. This will force insurers to restructure their offerings to support both the employer and the employee. We’ll see an increase in high deductible plans, focusing on providing true insurance for employees and employers against the financial impact of a high-cost drug. Greater focus will be put on the potential for catastrophic losses and there will be a trend away from providing coverage for affordable or non-life sustaining treatment.

Alternatively, employers will elect to cap the benefits available under the plan. This will cause a resurgence of employee-directed health plans, as employees will determine their own risk tolerance for cost at either the high end or the low end, depending on their employers’ offering.

Technology targets health

The most exciting thing happening in health and well-being is the number of diseases that will be cured and eradicated, not just treated, in the future. Genome mapping will allow targeted treatment of disease and eventually lead to cures for many illnesses. The focus will shift away from the treatment of chronic disease to maintaining a quality of life for all people at all ages.

As a fan of technology, I also see humans using technology to take better control of their lives. Technology can play a role in freeing up time to allow better self-care through physical activity and proper food selection. Technology will continue to lead to breakthroughs in disease diagnosis and treatment and will help overcome some of the barriers to healthy living.

United States

(by Hope Manion, with Dave Kerrigan)

Accident of history


“What if we had data feeds that correlated prescription usage, sick time off, and weather data…what if we knew an employee had migraines, and knew that they were triggered by sharp barometric pressure changes?” Hope Manion, Global Health Practice Leader, Philadelphia

A cliché comes to mind – the more things change, the more things stay the same.  Well, with a couple caveats, I think.  Bear with me…

100 years ago, there was no landscape.  Health care was largely self-funded by workers and families.  in the 1910s, the US generally lagged behind European counterparts in terms of interest in insuring against health care claims.

I only recently learned that the first employee group health insurance plan was started in Texas – in 1929, Justin Kimball created what would ultimately become Blue Cross Blue Shield of Texas when he set up a hospitalization insurance plan for the employees of the Dallas school district in conjunction with Baylor University Health System.  The scheme was arranged under an assumption that both hospitals and insurance plans are intended to not-for-profit public institutions.  This was effectively a vertical, Integrated Delivery Network – the doctors provided care, and the insurance plan paid for care – both entities were aligned with the health outcomes of the patient as the fundamental goal.

The accident of history that accelerated the evolution of employer-sponsored health care benefits in the US occurred as a reaction to wage and price controls during World War II.  From there, complex dynamics have been playing out ever since – employers, insurers, and providers continually trying to find the right mix of controls and influence to keep health care costs under control… and maximize one’s own profits, of course.

We know the rest – steep rises in health care costs in the 1950s, continuing into the ‘60s and 70s, some efforts to control costs in the 1980s via HMOs backfiring into a swing back to fee-for-service in the 90s.  By the mid-90s, health insurance was so expensive it was driving employment decisions, and millions of Americans were without coverage.

Of course, a meaningful portion of the inflation is due to advances in care and resulting extended life spans.   Still, I think many in our society are looking at care now – particularly at the end of life – and wondering if we’ve simply added to life spans without the accompanying quality of life to make the additional costs worthwhile (how actuarial of me, I know.)

Aligning incentives

So here we are in 2016 – PPACA is continuing to shape the landscape.  I think many are realizing now that exchanges aren’t going to be a quick solution  – they represent an important option for many, but the employer-sponsored plan has not gone the way of the dinosaur as predicted.

What I find very interesting is the movement BACK to the Dallas/Baylor model that we started with!  Integrated Delivery Systems, Accountable Care Organizations, Patient Centered Homes, whatever you call them, they represent a renewed focus on aligning incentives  to achieve better outcomes for the patients.   To say I welcome this is an understatement.  In my years as a business leader, things have never run so effectively and efficiently as when we have been able to align incentives for the total success of the practice.  Seems to me a no-brainer to apply this principal to our health care system.

Interesting dynamic

Health care costs will continue to go up, but if we can get the incentives aligned the increases will almost fully attributable to real and meaningful advances in care that prolong comfortable, active, dignified life.  And I think we’d all support that.

Examples of technologies on the horizon include DNA therapy, tissue engineering, and nanotechnology.  But I don’t feel qualified to write at length about those things…what’s more relevant to us as a benefits consulting firm is – how are we going to pay for that?

We’re going to have to work to eliminate preventable disease in order to make room in the economy for the cutting edge treatments – and employee benefits programs can help achieve that through wellness engagement.

This is where Health and Productivity Consulting will shine.  One interesting dynamic in this is the erosion of the fear of sharing one’s data.   Unlike Boomers and Gen Xers, the recently arrived and emerging  segments of the workforce are far less squeamish about sharing their personal data.  I see a future where biostatistics are freely shared with vendors, allowing for effective messaging and prompts that help employees manage their care.

We will work with employees to facilitate ownership of their own data, and design support programs that drive behaviors with individualized prompts at highly specified moments in employees’ lives.

An interesting idea along these lines that I heard about from my friend Dave Kerrigan last week – what if we had data feeds that correlated prescription usage, sick time off, and weather data…what if we knew an employee had migraines, and knew that they were triggered by sharp barometric pressure changes?  Could we have an engagement/support programs that notify that employee than a front is coming through within a day or so, and suggest that they prepare to work at home in order to minimize pain as well as time away from work?  The possibilities along these lines feel endless.

You can have the most efficient network discounts and best pharmacy contract possible, but if your employees aren’t engaged, aren’t armed with data and knowledge to take ownership of their health outcomes, you’re not even moving the needle over the long term. This is where I believe employee benefits consulting will be making the most impact for our clients in the future.


Your turn – What’s your vision of the future of employer-sponsored health programs? Let us now in the comment box below.