By Melanie Evans
Employers are increasingly going the distance to control health
spending, paying to send workers across the country to get medical
care and bypassing local health-care providers.
One of the latest is Amazon.com Inc., which will pay travel
costs for workers diagnosed with cancer who choose to see doctors
at City of Hope, a Los Angeles-area health system. More than
380,000 of the Seattle-based company's employees and families
across the U.S. are eligible for the travel benefit.
Travel programs are winning over employers despite added costs
for airfare, hotels and gasoline. Proponents say companies can get
competitive prices and employees get better care -- such as
avoiding unnecessary treatment -- by shopping around the country
instead of always relying on local providers. Employer health
plans, which cover roughly 153 million people in the U.S., struggle
to command competitive prices and quality controls in some markets
as health-care providers have consolidated and gained leverage in
"If you're able to look nationally, you're just going to have
more choices," for top doctors, said Lee Lewis, chief strategy
officer of the Health Transformation Alliance, an employer group
aimed at holding down health spending. Still, travel programs
require more work to run, he said, and employees can be reluctant
to be away from home when ill or undergoing a procedure.
City of Hope began to contract with employers last year with
multiple programs, including one through a program jointly run by
the Pacific Business Group on Health and consultants Health Design
Plus. An employer with 30,000 U.S. workers began to cover
cancer-care travel costs in March, according to PBGH, an employer
group. Four other employers signed on to its travel programs this
year, including two large regional employers in the Midwest and
Southeast that in January started to cover travel for spine and
joint-replacement surgeries, the group said.
About 10% of those eligible to travel to City of Hope for cancer
care are expected to do so, according to Health Design Plus. City
of Hope declined to say how many Amazon workers have traveled to
see its doctors since April, when that program was launched.
By paying employees' way to travel for medical care, Amazon
hopes to increase workers' choices and curb health spending by
getting workers to top specialists and reducing the chance of the
wrong diagnosis or treatment, said Dene Sparrman, the company's
director of global benefits.
Workers who travel to City of Hope meet with specialists who
review local doctors' records and might seek additional
information, such as genetic testing, to make treatment
"Instead of waiting for patients to get the wrong care first,
then reaching out to the expert, this model is designed so that the
patient has access to expertise as early as possible to help ensure
the correct care is delivered first," Ms. Sparrman said.
Amazon has stepped up its focus on employee health care. The
company last year announced a venture with Berkshire Hathaway Inc.
and JPMorgan Chase & Co. to reduce health costs. The venture,
named Haven, wasn't involved in the launch of Amazon's new travel
benefit, Haven and Amazon officials said.
Travel benefits are one of many strategies by employers seeking
to tamp down growth in health-benefit spending, which Labor
Department data show has increased faster than wages, though not
Employers typically cover about 70% of premium costs for
workers' health insurance, annual Kaiser Family Foundation data
show. Premiums have increased an average of 7% a year in the past
two decades, reaching about $20,500 for a family.
Some employers still balk at sending employees long distance for
care, said Dr. Jeff Dobro, health and benefits strategy and
innovation leader for consulting firm Mercer. That is changing with
more data to compare price and quality for hospitals and doctors,
he said. "Let's accept the fact that there are some hospital
systems and some doctors that do get better outcomes than others,"
Dr. Dobro added.
Other employers have run travel programs for years. Published
results are limited but suggest the programs save money and reduce
unnecessary care. Walmart Inc., Lowe's Cos. and McKesson Corp.
saved an estimated total of $19.4 million in 2017 as workers who
traveled to see spine and joint surgeons avoided unnecessary care,
Walmart reported in the Harvard Business Review in April.
Walmart workers diagnosed with breast, lung or colorectal cancer
can travel to the Mayo Clinic for evaluation. Of those who traveled
to Mayo for cancer care since 2015, about 10% received a new
diagnosis, the Bentonville, Ark., retailer's data show.
City of Hope said doctors have recommended a new diagnosis or
treatment for 84% of complex cancer patients in one of its employer
Amazon previously paid for travel only when no treatment was
available within 100 miles for life-threatening conditions, such as
advanced heart surgery. The new travel benefit can be used for any
cancer diagnosis, regardless of local options. Those who choose to
remain home can meet with City of Hope doctors by videoconference,
when state regulations allow.
Write to Melanie Evans at Melanie.Evans@wsj.com
(END) Dow Jones Newswires
October 15, 2019 05:44 ET (09:44 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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