Three Critical Questions You Need to Answer to Manage Your Healthcare Costs

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Three Critical Questions You Need to Answer to Manage Your Healthcare Costs

Hey employers, whether you like it or not, you're in the population health management business. You may not think of it in those terms just yet, but your company is responsible for keeping your employees (and often their family members) healthy and cared for. In our experience, we have identified three critical questions that employers need to answer in order to manage their health care costs efficiently while keeping their employee population healthy and happy.

1. How well do I understand the disease states occurring in my employee population?

“Disease states” is healthcare industry talk for what medical conditions and issues are affecting your employees. Every employer’s population has a different make up of challenges and health trends. Effectively managing your employee’s health care is impossible without an understanding of the disease states your population is most likely to face. In addition to employees, companies are often responsible for the health care of their families. When combined, you have the entire population of lives which determine your healthcare costs.

For the lives you're responsible for, the question evolves into, "Do I know what percentage has Type 2 Diabetes, Congestive Heart Failure, COPD, or other common disease states?" How well do I understand how those percentages affect the company's health care expenses? Awareness of the disease states trending in a population helps equip companies to:

  • choose more appropriate plans with their insurance companies
  • negotiate better deals for drugs and treatments
  • know when to hire outside third-party vendors
  • determine which wellness and fitness programs to invest in and when

2. What wellness efforts will most effectively lower our greatest health care expenses?

If you fully understand the disease states in your employee population, you can move on to making effective and proactive decisions on your wellness efforts throughout your organization. Additionally, you can better evaluate the outcomes and participations in your wellness efforts and understand how they address (or often don’t address) your employee population’s actual risk factors and disease states.

For example, engine manufacturing behemoth Cummins built a dedicated employee health care center called LiveWell with the goal of providing primary care and urgent care services, but also proactive lifestyle coaching and education programming to help their employees live healthier, happier lives. This more holistic approach includes features like an on-site chef and meal preparation lessons to teach Cummins employees to cook healthier food for themselves and their families. The Cummins LiveWell Center is managed by Premise Health, the nation’s leading worksite health and wellness provider. (

3. Do we have the right formulary for our employee population?

Negotiation for drug prices and treatments are one of the biggest ways you can control your expenses. With the right data, you can make better decisions on where to focus your efforts. When equipped with the right data, your formulary can be tailored to address the primary disease states and needs of your employee population.

A good example is a recent client who was paying for employees to use a 1x/day extended release aspirin. Recent studies showed that the drug had no increased benefits to the user over regular baby aspirin, which was 96% less expensive. Because this was being used to treat a high proportion of disease states in the population, switching saved thousands of dollars with no negative effects.

Data visualization makes all the difference.

Ultimately, the goal is to use your data to facilitate continuous improvement for your employee’s wellbeing and your bottom line. We have learned that most organizations have this data floating around but haven’t been able to visualize it in a way to effectively make decisions. Developing visual dashboards and monitoring tools that equip you with the reporting will make reviewing your data simple, which plays a key role in giving you the ability to dive deeper into the data for in-depth decision making. Remember, whether you like it or not, you're in the population health management business.


Kent Hiller LinkedIn Kent Hiller
Perscio | Partner
(317) 696-1697

About Kent:

Kent is a 25+ year technology executive with experience spanning many disciplines and industries including aerospace, state government, financial services, learning management, healthcare, technology & management consulting.

The first portion of his career was spent as a design engineer in the defense sector for Boeing Defense & Space Group. While there, Kent transitioned to data and software and has remained in that arena ever since. The following 10 years was spent managing all aspects of software development and delivery. The last third of Kent’s career has been focused on the business aspects of technology.

Kent’s expertise covers strategic planning, new market development, web-based product management, product strategy, partnership/relationship management, and sales. Kent’s primary focus for the last 6+ years has been healthcare where he has built and delivered solutions for both providers and payers. Kent earned a B.S. in Mechanical Engineering Technology from Purdue University and an MBA from Seattle University. In addition, Kent serves as a councilor on the Dean's Advisory Council (DAC) at IU School of Informatics and Computing.