On the ground with Local Markets CEO: Strategic cost management is among top priorities for employers

UnitedHealthcare Local Markets CEO explains why employers, regardless of size or location, are seeking ways to better manage their health care costs.

Feb. 16, 2023

Authored by Darren Moquist, CEO of Local Markets with UnitedHealthcare Employer & Individual

In my role as Local Markets CEO for UnitedHealthcare Employer & Individual, I’m working with health plan and regional leadership to understand what employers, brokers and consultants are focused on across the nation when it comes to health care. In 2023, it’s clear that the economy has pushed one priority to the top of the list: cost management.

Employers are looking for opportunities to reduce costs within almost every aspect of their business. Since health care costs are often the second-largest expense on an employer’s balance sheet behind employee compensation, it’s no surprise companies may be considering paring back on their health benefits or shifting some of the costs onto their employees. We understand those decisions are difficult to make, because they come with the potential risk of lowering employee satisfaction and leading to worse health outcomes and higher costs down the road.

At UnitedHealthcare, we are working to bring effective cost-management strategies and solutions to market that fit within employers’ budgets, while also meeting the needs of their employees and their families.

Let's talk cost management

Video transcript

Funky bass music builds as four smiling people in suits appear, one at a time. The view focuses on a man with glasses in a checkered grey and black blazer. In the right corner of the view, a small grey version of the UnitedHealthcare logo—the letter U, split into three stripes on its right arm—appears. A blue banner below and to the left of the man’s face shows his name and affiliation in white text:
ONSCREEN TEXT: Darren Moquist, CEO of Local Markets, UnitedHealthcare Employer & Individual
DARREN MOQUIST: I’m Darren Moquist, CEO of Local Markets. I have the opportunity to work with all of our health plans across the country. That also includes working with our regional CEOs, and we work together to formalize strategies in terms of our position in the marketplace, how do we go to market, our product positioning, and our network plans across the country.
Now navy-blue text fades on to the center of a white background:
ONSCREEN TEXT: Let’s talk cost management
The text vanishes, and a ribbon resembling the UnitedHealthcare logo—navy blue, with three stripes—winds across the background. The view returns to Darren.
DARREN MOQUIST: Healthcare costs are rising at an unsustainable rate across the country.
Now a man in a black suit jacket and pale blue shirt speaks. A blue banner in the bottom left of the view displays white text:
ONSCREEN TEXT: Dave Milich CEO, Central Region, UnitedHealthcare Employer & Individual
DAVE MILICH: And so what it’s forced is a much more strategic conversation with customers about what are other levers that they can push and pull that will enable them to control the cost of their benefit plan.
Next, a blonde woman in a black blazer and red blouse speaks. White text in a blue banner to her left reads:
ONSCREEN TEXT: Beth Soberg, CEO, West Region, UnitedHealthcare Employer & Individual
BETH SOBERG: Our ability to bring them solutions that address those cost issues in a durable way without transferring that onto their employees and family members is an area that UnitedHealthcare is uniquely positioned to bring.
A man in a navy blazer and a burgundy and white checkered shirt speaks before a wall of windows. White text on a blue banner in the bottom left corner of the view reads:
ONSCREEN TEXT: Greg Reidy, CEO, East Region, UnitedHealthcare Employer & Individual
GREG REIDY: Our employers that we serve, and their employees, are looking for us to deliver something different—something that engages them, something that offers them choice, something that allows them to be a consumer and navigate a very complex system in a way that is different than it was five or ten years ago.
Greg’s banner disappears. Now people smile as they lead meetings and work at laptops in a white open-concept office. On a couch, a man nods at a tablet, and a woman works at a laptop in a farmhouse-style kitchen. The view returns to Greg, then Darren.
DARREN MOQUIST: It’s key going forward that we all partner together. This includes partnering with employers, employees, brokers, and consultants to find that sustainable solution. Key to this is obviously network and plan designs, our clinical strategies, but more importantly, how do we continue to engage and better engage the consumer as part of their healthcare journey.
A white background wipes across the screen, and navy-blue words pop on one by one as Darren speaks:
ONSCREEN TEXT: Employers, employees, brokers and consultants
New text appears:
ONSCREEN TEXT: Sustainable solution
The text drops away from the bottom of the way, replaced by blue and teal icons in the center. A navy-blue circle with a teal ring in the center and three white dots appears. Next, a navy-blue circle with a teal and white book in the middle appears, followed by a circle with a stethoscope in it on the right. Now a woman in a white blouse and pink paperbag-waist pants strides past the glass wall of a busy boardroom. A woman talks on the phone while holding a baby, and a man pushes a grinning child in a cardboard box down a smooth hallway. The view returns to Dave, then Darren.

DAVE MILICH: Where we can help employers understand the value of decision-making that their employees and their families make to reduce costs is becoming more and more important.
DARREN MOQUIST: For me it’s really exciting to work for a company that cares for its employees and for the employers and members that we get to serve every single day. Cost management is critical to that, and we wake up every single day looking at how do we help our members with their care journeys, and how do we reduce costs for the employers—all making it simpler for everyone in the healthcare system.
Now navy-blue text appears on a white background. Each word pops into the center of the view one at a time:
ONSCREEN TEXT: Cost management that meets the moment
New blue text appears in the center:
ONSCREEN TEXT: Talk to your broker, consultant, or UnitedHealthcare representative to learn more
As the music comes to a jazzy conclusion, three navy-blue stripes wind their way to the center of the white background. They form the UnitedHealthcare logo—a stylized, navy-blue letter U that splits into three stripes on the right-hand side. The logo disappears, and navy text fades in to the middle:
ONSCREEN TEXT: United Healthcare
Black fine print fades in beneath the text:
ONSCREEN TEXT: Insurance coverage provided by or through UnitedHealthcare Insurance Company or its affiliates. Administrative services provided by United HealthCare Services, Inc. or their affiliates.

© 2023 United HealthCare Services, Inc. All Rights Reserved. 22-186171-M 2/23

Taking a holistic approach to cost of care

UnitedHealthcare has not taken our eye off the ball in terms of total cost of care. While some of our competitors have focused more on unit cost and making sure that they're getting the lowest cost they can from various providers, we continue to stay focused on the full continuum of care. That means, we’re focused on the cost that we pay and making sure that we have a fair reimbursement to providers, including how we reward and incentivize providers and making sure that they are aligned with us and with what the member requires in terms of experience and quality outcomes.

We’re also committed to making sure that the out-of-pocket cost doesn't create an environment that's unintended, such as where care is deferred due to affordability on the part of the member. So, our ongoing focus is across that full continuum, and it continues to differentiate us in the market.

What’s trending across the nation?

Understanding an employer’s priorities requires us to know the ins and outs of the business and the state of the employee population’s health. By combing through data, insights and the performance of an employer’s health plan over time, we are helping to pinpoint the right blend of health plan and network design, clinical strategies and employee engagement programs that work together to improve health outcomes and reduce costs.

For example, level-funded plans continue to gain popularity across markets, especially with small and midsize businesses. This funding structure offers employers the potential savings of self-funded plans with reduced risk, as well as the predictability of fully insured plans at a potentially lower cost. Surest is another health plan growing in popularity for its ability to provide price clarity and empower employees to make more informed health care decisions.

Investing in networks that promote providers who deliver quality care at lower costs is another avenue employers are taking. In the West, the philosophy that primary care providers help guide employees to quality care at lower costs is gaining traction among employers through PCP-centered health plans. In the Central region, many employers are leveraging health plans that take a portion of the savings generated from these quality-focused networks and returning those savings in the form of richer health benefits. And in the East region, as well as across the country, both tiered and narrow networks are helping to reduce costs and drive better health outcomes for employers.¹

These health plan and network designs are complemented by integrated clinical solutions that help guide employees throughout their health journey and employee engagement programs that incentivize and empower employees to make healthier choices.

Cost has consistently been a focus for employers and for us at UnitedHealthcare, but the environment we’re living and working in today is challenging us all to think more strategically about how we manage costs.

Contact your broker, consultant or UnitedHealthcare representative to learn more about the cost-management strategies that may be available to you.

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Footnotes

Network configurations may help improve care quality while reducing costs. UnitedHealthcare, 2023. Available: https://www.uhc.com/broker-consultant/news-strategies/resources/more-employers-consider-network-configurations-to-help-improve-care-quality-and-reduce-costs.

Disclaimers

Surest: Insurance coverage for fully insured plans is provided by All Savers Insurance Company (for FL, GA, OH, UT and VA) or by UnitedHealthcare Insurance Company (for AZ, AR, MI, MN, MO, OK, PA, SC and TN). These policies have exclusions, limitations, and terms under which the policy may be continued in force or discontinued. For costs and complete details of the coverage, contact either your broker or the company. Administrative services for insurance products underwritten by All Savers Insurance Company and UnitedHealthcare Insurance Company, and for self-funded plans, are provided by Bind Benefits, Inc. d/b/a Surest, its affiliate United HealthCare Services, Inc., or by Bind Benefits, Inc. d/b/a Surest Administrators Services, in CA. Stop loss insurance for level-funded plans is underwritten by United Healthcare Insurance Company.

UnitedHealthcare Level Funded: Administrative services provided by United HealthCare Services, Inc. or their affiliates, and UnitedHealthcare Service LLC in NY. Stop-loss insurance is underwritten by UnitedHealthcare Insurance Company or their affiliates, including UnitedHealthcare Life Insurance Company in NJ, and UnitedHealthcare Insurance Company of New York in NY.

UnitedHealthcare Fully Insured and Self-funded: Insurance coverage provided by or through UnitedHealthcare Insurance Company or its affiliates. Administrative services provided by United HealthCare Services, Inc. or their affiliates.