National Academy of Medicine

Understanding What Employers Are Up To: Think Managed Consumerism, Not Exit

By Robert Galvin
August 15, 2014 | Commentary

Employers have a major impact on the U.S. health care system through their sponsorship of health benefits for more than 150 million Americans. In response to the changes occurring in the context of the Affordable Care Act, firms are reassessing and changing their health care strategies with more urgency than since the double digit inflationary era of the 1980s. Determining a unifying theme for a new employer approach is challenging because employers act very differently based on their labor markets, and there is no accepted central “voice” that speaks on behalf of employers. In my opinion, the contrasting opinions currently gaining traction on employer direction on the one hand predicting that employers will exit the sponsorship of health benefits due to some large firms having adopted a defined contribution approach, or on the other hand that employers are intensifying health care management efforts (because several companies have invested in worksite medical clinics) are both inaccurate. Based on both my read of the literature and annual meetings with the chief executive officers (CEOs) of the 50 small and large companies for whom I buy health benefits, the emerging framework shift is best described as moving from paternalism to “managed consumerism.”



Suggested Citation

Galvin, R. 2014. Understanding What Employers Are Up to: Think Managed Consumerism, Not Exit. NAM Perspectives. Commentary, National Academy of Medicine, Washington, DC. doi: 10.31478/201408b


Disclaimer: The views expressed in this paper are those of the authors and not necessarily of the authors’ organizations, the National Academy of Medicine (NAM), or the National Academies of Sciences, Engineering, and Medicine (the National Academies). The paper is intended to help inform and stimulate discussion. It is not a report of the NAM or the National Academies. Copyright by the National Academy of Sciences. All rights reserved.