Top 5 Questions for Employers to Ask ‘Point Solutions’

Top 5 Questions for Employers to Ask ‘Point Solutions’

Many employers, insurance brokers and benefits consultants use the term ‘Point Solution Burnout.’ First, employee health plan point solutions are narrow in scope and address a single health category or condition.

For example, the point solution may address diabetes, musculoskeletal pain, or mental health.

Second, ‘burnout’ comes from the sheer volume of employee health plan point solutions. Most point solution companies are newer venture capital or private equity-backed companies. 

The number of new digital healthcare companies per year increased from 94 in 2011 to 738 in 2021… a 785% increase. The amount of investment in new digital healthcare companies increased from $10.8B in 2015 to $57.2B in 2021… a 530% increase.

Many—but not all—of these new digital health companies are employee benefits point solutions.

Employers, insurance brokers, and benefits consultants have dozens if not hundreds of point solutions to evaluate and potentially implement.

It is challenging for employers and their broker/benefits consultant to evaluate all of these point solution vendors; however, the ‘5 Why’s’ approach that was invented by the founder of Toyota Motors offers a helpful framework for assessing point solutions and not getting burned out.

The 5 Why’s for Employee Health Plan Point Solutions:

1. Why does the point solution work?

Most point solutions report great results, but an employer must know if the WAY the point solution achieved those results will work for their own employee health plan population. For example, a musculoskeletal point solution may involve doing physical therapy exercises guided by a video on a smartphone app. Trucking company employees may not be able to perform these exercises because they are literally driving or ‘on the road’ at truck stops.

2. Why do employees use it?

The number one problem for point solutions is Low Utilization. Again, understanding the WHY behind utilization allows an employer to determine if their own employee health plan members will use the solution. For example, a diabetes point solution may involve counseling to eat less sugar. Frankly, employee health plan members may have little interest in eating less sugar. They like the way it tastes and makes them feel.

3. Why is implementation easy?

Every point solution SAYS that implementation is easy. However, it is necessary for a point solution to SHOW that implementation is easy be giving the potential customer a detailed Gantt Chart of the implementation project plan with assignments for WHO is responsible for each task and WHEN each task is due.

4. Why is it priced this way?

Most employee benefits professionals need to convince the CFO, purchasing, or finance departments that the point solution is of good value… i.e. has a low price. Point solutions need to have a pricing model that is straight-forward to allow the HR department to easily show their finance colleagues the solution’s value.

5. Why should I buy this point solution now?

Most point solutions try to say they are addressing some ‘impending doom’ for an employee health plan… but is it really a crisis? Employers need to use data from their own health plan to determine their clinical priorities.

Employee health plan point solutions can be instrumental for the success of the plan. The point is NOT to avoid all point solutions. Rather, the point is to systematically have an approach for evaluating point solutions so as to separate the ‘wheat’ from the ‘chaff’ and not be overwhelmed in the process.