Helen Darling says that rising health care costs continue to be a "serious concern" for U.S. business leaders. The longtime president and CEO of the National Business Group on Health says employers would like to see a greater focus on value and transparency. The group's latest survey of large employers also found increasing reliance on wellness initiatives and consumer-directed health plans as a means to lower costs. | Interviewed by Matthew Weinstock

Did anything in your latest survey on large employers and health care costs surprise you?

DARLING: Not really. We've been headed in the same direction for a while. However, if you look at what they said is the most effective tactic for controlling health care costs, wellness initiatives to improve health are at the top. Below that is consumer-directed health care. I was only surprised because that is a switch from last year. Secondly, it is optimistic to think that wellness initiatives are really effective. I hope it is true. The fact that they believe it — and presumably have enough evidence to say that — is nice to know.

Are you seeing enough hard evidence that wellness programs work, or is it still based on anecdotes?

DARLING: There's evidence in specific cases where a big company has done a lot to try to improve health. If you push hard enough, it does affect risk factors. But on a broad scale, change is really hard.

Consider someone who has a high BMI, is not active and is not taking medication, but should be. If you take people through a series of steps to help them understand the relationship between BMI and health problems like diabetes, you may get them up from being couch potatoes to taking the stairs or going to the gym. Although you may not see an immediate effect, those people are on a different path.

The survey showed that costs rose by 7 percent for the third straight year. How much does that concern business leaders?

DARLING: We do another survey every year with Towers Watson looking at what employers are actually doing to control costs. We pull out the top performers, those employers that report much lower increases — 3 or 4 percent, not the 7 or 8 percent — and look at what they do that's different. The companies that are not top performers worry about how high the costs are, how costs continue to rise and that they may not be willing to do what is necessary to control those costs, or they may not be able to because they have unions or other issues. Those companies are very worried.

These are the same companies that can see that they'll hit the Cadillac tax before anyone else. The C-suite really gets the effect of the Cadillac tax because it is a cost that's coming right off the top.

Are those companies looking at ways to act more like top performers?

DARLING: Yes. More of them are putting in consumer-directed health plans. Our survey showed that 22 percent are now just saying, "You get one choice and it is a consumer-directed health plan. There may be a choice in from a high deductible and a higher deductible, but you can't have a PPO or traditional HMO anymore."

We are also seeing spousal surcharges and spousal carve-outs, as well as tiers for drug coverage.

You see more employers talking to organizations like the Cleveland Clinic or Johns Hopkins about using them as a center of excellence for things beyond transplants; looking at things like hip and knee replacements.

Do you expect to see more direct contracting or tighter relationships between employers and hospitals?

DARLING: Yes, I do. They are eager to have more narrow networks, as well, so that they have an ability to offer a less-expensive plan.

Do you think that creates tension between employers and their local providers, or does it force local hospitals to focus on improvement?

DARLING: Both, I think. I know of a situation in which an employer contracted with Cleveland Clinic, and the leaders of the premier hospital in that area were upset. They took it as a stunning fact that a company would do that when they felt they offered equally good care. Aside from being angry, they said, "What do we need to do to prevent that from happening again? What do we need to do to be in the game?"

Is there validity to the concern that consumer-directed plans could drive up hospital bad debt?

DARLING: That is a big problem and I'm sure it is bigger in some locations than others. There is no question that the average low-wage employee in a high-deductible plan is unlikely to have the money or be able to spend the money.

Does that raise any red flags with leaders in the business community?

DARLING: In the survey, we ask if wage-based premiums and deductibles are available. In 2014, 33 percent said that they would have wage-based premiums. Another 8 percent are considering it for 2015. It is 5 percent and 1 percent for deductibles. So, there is some concern that the deductibles for people with low wages may be a problem.

Is the health system moving fast enough to value-based purchasing and a focus on outcomes?

DARLING: It is never fast enough to value. It feels as though we've all been at this for more than 20 years and we still aren't where we need to be. There's been more movement over the last couple of years than ever, though. Some of that has been driven by health IT. Some of the legislation on Medicare has been driving it as well, especially in the area of patient safety and quality, but we are worried about the speed with which real value is demonstrated and we are worried about the lack of transparency.

We will be pushing hard for anything to do with transparency, which we think benefits everybody.

What does that mean?

DARLING: Anything we are involved in, which includes initiatives with hospitals; we are all working together to reach agreement on the right metrics that everyone can live with, but will drive the system forward faster and will allow not just consumers, but purchasers, to know what works, what it should cost and who is paying for it.

The Darling File

C.V.
Darling also leads NBGH's Institute on Health Care Costs and Solutions and chairs the National Quality Forum's Committee on Performance Measurement.

READING
A "voracious" reader of The New Yorker. Mann Booker award finalists also go "right to my reading list."

MENTOR
"My father taught my sister and me to be independent, work very hard at anything we ever did, always do the best possible and rely on ourselves in life."

LIVING WELL

NBGH walks the talk on wellness. All catered meals are "healthful and delicious." Conferences include walks and yoga. Many NBGH staff use pedometers daily (Darling's been doing so for eight years) and get a monthly $25 allowance for wellness activities.