Restaurant management

Can concierge medical services work in the restaurant industry? | modern restaurant management

For several years, we have been considering the viability of highly tactile healthcare concierge programs in the restaurant space. The market leaders in this area are several third-party providers, although some carriers also develop and offer these services. The appeal of the strategy is improved employee perception of the plans while reducing plan costs. One of our restaurant clients has adopted this strategy and our initial analysis is that first year medical expenses have been reduced by approximately 5% and more importantly a reduced rate of increase of 2% is expected in the years to come.

These results are achieved by dramatically increasing employee engagement and awareness of the benefits offering and gently guiding members to the highest value vendors and facilities. The premise is that employees (especially those with significant health issues) find it difficult to navigate the world of health insurance and, as a result, are likely to make poor and ineffective choices. The theory is that continued interaction and support will build trust. This is accomplished by changing the way they receive services and advice. Rather than contacting the insurance company for questions about benefits or services and care, members are encouraged to call a single number to speak to a concierge who will assist them directly (no more call trees). Types and scope of services include:

  • Identity card applications
  • Questions about coverage and benefits
  • Assistance in finding service providers and making appointments
  • Verification and advice before admission
  • Leave coordination and planning
  • Overall coordination of care
  • Outbound calls based on individual health conditions and claims activity
  • Questions and disputes about medical bills
  • Taking all supplier calls

Rather than trying to figure out which number to call or whether to call, employees only need to call one number for all benefits-related issues. Since each employer is assigned a small dedicated team, the goal is to build trust between the concierge and employees through ongoing interactions. Benefit program perception is improved by providing a significantly increased level of service, costs are controlled by helping to manage care gaps and identifying potential large claims earlier.

While the success of these programs in more traditional industries is well documented, we were uncomfortable if a restaurant workforce would engage with the services: would this type of workforce appreciate help in navigating the field of medical care? Additionally, the traditional belief was that it can take years to develop the confidence needed to succeed – a significant hurdle in an industry with high turnover. The data we see for a large client (ABC) indicates that the approach can achieve the objectives.

As stated earlier, the key to this type of program is the degree of commitment of the participants. Accordingly, we focused on four key indicators:

  • The number of members who have engaged (used) the program
  • The percentage of members with claims over $10,000 who have committed
  • The percentage of high claimants ($50,000) and above who are committed
  • Quality user reviews

Average interactions per member over the past 12 months for ABC were 4.5 versus 4.3 for the entire business portfolio. More importantly, during the initial 12 month period, 66% of ABC members contacted the service. This figure has fallen to 54% in the last 12 months, but it remains close to the Book of Business rate of 56%.

Savings are usually generated by engaging the main requesters. A significant difference between the model and typical carrier or TPA claims management programs is that there is a concerted effort to handle claims up to $10,000 (as simple as a routine delivery). The interception rate (direct contact) with these complaints was 94%. More importantly, on average, there was contact involving these claim situations 56 days earlier than would have occurred under a traditional carrier or TPA medical claims management model. This means that it was possible to have an impact on the situation before the treatment program was fully defined.

Prior to the concierge program, we were continually frustrated with the rate of handling major cases. It was not uncommon to have engagement results below 10%. High Seekers are not comfortable engaging with a service with which they have had little or no prior interaction during a time of high stress. With the concierge program, we see a 10-15x higher connection rate for claims over $100,000.

Finally, these programs will only be successful in the long term if the participants are satisfied with the service. This level of satisfaction is also critical to the employer’s goal of increasing plan perception. A typical measure for the service industry is the National Promoter Score (NPS). The two-year results based on responses from ABC participants were 83. Equally important, 86% said they would promote the service. This compares to the average insurer score of 57.

The piece that has yet to be addressed is that of cost savings. While we have clear indications that the level of engagement is driving the projected savings, given the volatility in claims trends during this time of COVID, we are uncomfortable drawing concrete conclusions. Additionally, while early results are encouraging, it is important to note that concierge programs will have varying pricing models that can be challenging from an upfront budget or funding perspective. Our client realized, at least initially, that the extra dollars spent created a return on investment with the expectation of even better results as employee engagement continues to increase.

As restaurants continue to struggle with recruiting and retaining staff, improving benefits programs may be part of the answer. A well-designed and managed program can have the rare impact of improving the participant experience while controlling costs. While they may not be the answer in every situation, they are certainly worth considering.