Troy Brennan, executive vice president and chief medical officer at CVS Caremark Corp., gave his recommendation on what employers should do when health insurance exchanges come into play in 2014, as mandated by health care reform.


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CVS chief medical officer sizes up health exchanges

October 27th, 2011

BOSTON – Troy Brennan, executive vice president and chief medical officer at CVS Caremark Corp., gave his recommendation on what employers should do when health insurance exchanges come into play in 2014, as mandated by health care reform.

Speaking to attendees Thursday at the National Business Group on Health (NBGH) annual meeting in Boston, Brennan said employers should continue company-sponsored health plans rather than move workers to choose health care coverage via insurance exchanges.

Why go that route? Employers would maintain more influence in their employees' health, which ultimately impacts their business, he noted.

"The decision you make regarding how to manage your employees' health care moving forward is important for your employees and your business," Brennan said at the meeting. "Do you stay in the driver's seat and proactively manage the health and productivity of your workforce, or do you climb into the back seat and take your chances?"

Brennan reviewed projections from six analysts on the impact that the Affordable Care Act health reform law will have on the health care market. The review included forecasts from the Congressional Budget Office, Rand Corp., the Urban Institute, Goldman Sachs, the Lewin Group, Deutsche Bank and one developed for CVS Caremark.

Although all of the independent projections projected that the nation's uninsured population will shrink as a result of the health care reform, they weren't conclusive about the future of employee-sponsored health plans. Several projections forecast a market decline for employee-sponsored health coverage, while others show slight growth.

Looking at the track record of workplace health and wellness programs and their impact on medical costs, Brennan said 25 years of peer-reviewed studies show inconsistent results. For example, recent research into health care savings from aggressive smoking-cessation and weight-loss programs showed employers realizing significant medical cost savings. One study examining smoking cessation programs projected a 10-year savings in excess of $7 billion. Yet Brennan said other studies found less dramatic and sometimes mixed results when it came to medical cost savings.

"I wish the literature was conclusive, but it is not," Brennan told attendees. "What we know is that there are actions and programs that have had a direct impact on employee heath and productivity. It seems clear those of us in the health care industry have to be creative and diligent in developing and administering these programs, because absenteeism and productivity go to the bottom line."

He added, "We found successful programs are run by companies where the leadership fully supports developing a healthy culture. The research shows employers need to use all the tools at their disposal — web, telephone, incentives and face-to-face counseling — to encourage healthy individual behaviors. By aggressively managing employee benefits, we can achieve a healthy and productive workforce and lower medical costs."

Brennan is a former professor of medicine, law and public health at Harvard University and formerly served as president and chief executive officer of Brigham and Women's Physician Organization and chief medical officer of Aetna Inc. before joining CVS Caremark.

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