A better way

The current health care system is unsustainable and it costs too much. The Health Transformation Alliance’s goal is to improve the way corporations provide health care benefits in an effort to create better health care outcomes for their employees. By coming together to share expertise, the companies seek to make the current multilayered supply chain more efficient. We view it as A Better Way.


America’s health care system is unsustainable.

It is a patchwork of complicated, expensive and wasteful systems. The time has come to stop adding bandages and address what’s fundamentally wrong.

For employers and employees, the price of premiums, copayments and deductibles is rising at a rate that is making health care unaffordable to millions of workers, and to their employers as well.

To transform the system and create a better way of delivering health care benefits to workers, 20 of America’s most successful corporations have joined together.

The companies have done as much as they can to improve the system individually. By banding together, they can make a bigger difference.

The initiative focuses on reducing the redundancies and waste in the supply chain that drive up the cost of health care coverage. By coming together to share expertise, the companies seek to make the current multilayered supply chain more efficient.

The effort to transform the system will be led by a not-for-profit entity known as the Health Transformation Alliance℠. The Alliance will serve as part of each company’s health strategy, bringing increased innovation, better analyses of the latest data, and greater leverage into how corporations obtain coverage for their workers.

The Alliance seeks to fundamentally transform the corporate health care benefit marketplace by first focusing on four areas:

  • Greater Marketplace Efficiencies

    Today, employers rely on a broad range of organizations to procure health care services, and often these organizations serve interests not aligned with the interests of employers and the people they employ. The Alliance will pool the resources and expertise of its member companies to gain leverage and create an organization whose sole focus will be to ensure the health care needs of employees are being met more effectively and efficiently.

  • Learning from Data

    Employers have become experts in studying data and trends to make wise business decisions in a variety of areas. The health care marketplace lags behind other sectors in using data available to identify best treatments, good outcomes and cost reductions. By pooling aggregated data that doesn’t identify individual patient information and using it to improve the effectiveness of the health care supply chain, the Alliance anticipates delivering better health care while reducing costs.

  • Educating Employees

    Employers have considerable experience working directly with their employees to explain companywide benefits, but the complexities of health care are difficult and costly to explain. By pooling their knowledge and resources, members of the Alliance will be able to develop better and more helpful tools to educate employees about their health care choices. Helping employees to better navigate these choices will result in better outcomes, increased savings and more satisfied employees.

  • Breaking Bad Habits

    Patients, along with the health care system, too often pay for prescription drugs that are not the most cost effective for their care. Doctors, along with patients, aren’t always armed with a full range of facts concerning best outcomes and pricing for pharmaceuticals. This happens in part because incentives currently built into the delivery system have made it habitual to pass costs along. The Alliance will seek to change costly and inefficient purchasing and contracting systems that don’t deliver better health care results, but do drive up health care costs.

Collectively, the 20 companies are responsible for health care benefits for four million people and spend more than $14 billion annually on health care for employees, their dependents and retirees.

The HTA will be built and organized throughout 2016. Beginning as soon as 2017, pilot projects will be launched to help employees obtain more affordable prescription medications. The rest of the major initiatives are planned to begin in 2018 or later.

© 2015 Health Transformation Alliance

Frequently Asked Questions

The health care status quo cannot be maintained. We want to deliver better health care outcomes for our workers and to do something about rising prices. Costs, especially premiums, deductibles and copayments for workers, are rising faster than can be afforded. We believe that by joining together, we can fix what’s broken and transform the corporate health care marketplace to help our employees, retirees and their dependents.
Yes, we expect others will join. These companies represent a mix of industries and regions across the country. We started with companies that are members of the HR Policy Association and that’s why these are the first to join.
Every benefit manager and senior corporate executive knows that health care is one of the most expensive, wasteful and complicated systems in America. We are confident that by working together we can achieve considerable savings and make the health care system work more efficiently for our employees. There is widespread recognition that the status quo cannot be sustained.
  • Can you be more specific?

    An example is found in the way employees, retirees and their families receive care from hospitals and physician groups. If we conclude that contracting directly with these providers for high-quality care is more effective and efficient than using traditional networks, we will do so.

    Another example is:

    The Centers for Disease Control and Prevention (CDC) recently reported that 58 percent of Americans who test positive for high levels of cholesterol—and who therefore bear a high risk of strokes and heart attacks—are receiving no care for their condition.

    Working with doctors, nurses and health caregivers, we will use the best analytics tools to figure out what kind of care works best for people with high cholesterol— which prevention programs and which medicines most effectively prevent strokes and heart attacks.

    Then we will analyze which kinds of patient education programs work best to get and keep people involved in improving their health, and we will invest in those programs to help our people.

    We also intend to personalize this care—to make available testing that matches patients with the medicines that work best with their genetic profile.

    We are confident that these smart investments in our people will be rewarded many times over—in strokes and heart attacks avoided and lives saved.

Under the Health Transformation Alliance℠ (HTA), health care providers will compete on the basis of value and performance quality for the right to serve our members. Benefit managers will gain additional leverage in the health care marketplace and more options to design their health care plans. Also, benefit managers will appreciate HTA’s role in vetting new technologies from an impartial perspective, which will give them an even greater ability to benefit from new technological breakthroughs and the knowledge of their peers.
The quest for an improved employer-sponsored health system has been in the works for years, and large employers have long been in the vanguard of making cutting-edge and innovative changes to the employer-sponsored insurance (ESI) system. In the 2000s, employer efforts in wellness plans and Consumer Directed Health Plans contributed to the recent stabilization of health care inflation. And in the spring of 2014, the American Health Policy Institute was formed to help employers think of solutions to the challenges facing employer-sponsored health care. In May of 2015, AHPI issued its Call to Action, signaling that employers were ready to try a new approach to securing better health coverage for employees and dependents. The HTA grew out of that Call to Action.
Extensive meetings were held in the summer and fall of 2015 designing the concept and getting ready for this announcement. We first met with numerous CHROs, other corporate leaders and their staffs to listen to their needs and concerns and to include their feedback in the concept. We are ready now to proceed with the announcement.
The goal of the ACA was to make health care more affordable, and we share that goal. The HTA, however, is a private sector response to what’s happening in the marketplace, and we are not seeking any assistance from Washington. The HTA is designed to work on its own, regardless of the twists and turns that take place in government health policy.
We will be building the HTA throughout 2016 and growing its membership. We anticipate beginning as soon as 2017 pilot projects that would help our employees obtain more affordable prescription medications, and we anticipate the rest of our major initiatives would begin in 2018 or later.

Yes, subject to the provisions of bylaws that have been adopted by the Founding Members. The HTA welcomes the opportunity to incorporate both supply-chain and non-supply-chain participants from the perspective of their roles as employers. Employers, regardless of their business models, are facing real challenges in trying to provide affordable health care for their employees, and the HTA is designed to address those challenges.

We hope to hear from the supply chain about how it can work with us to recast a system that everyone agrees needs to be improved. We are looking for innovators in the supply chain, the pioneers who want to break from the status quo and work with the group of pioneering employers who want to build a better way.

No. We will not. The data we receive will not have any personal identifying information attached to it. As is standard practice, all names and other identifying information will be stripped from the data, allowing us to have access to trends that show what the best practices are to deliver the best health care at affordable costs. We need to know the macro trends— what works and what doesn’t. We will not have any other information.

Unlike a private exchange, the HTA is not a product. Nor is it operated by brokers or insurers. Rather, the HTA is an alliance comprising large employers working together to find innovative ways to provide high-value and high-quality health care benefits to their employees.

No. The rules regarding trusts prevent collusion among entities seeking to sell their products. The Alliance is a joint venture among employers in a variety of industries seeking to improve the way they purchase and provide health care benefits.

No. The crucial identifying characteristic of a Multi-Employer Welfare Arrangement (MEWA) is its assumption of financial and/or performance risk in the delivery of benefits. The Alliance will not bear any such risk. Instead, the HTA will facilitate contracting opportunities between the members of the Alliance and service providers. When member companies choose to avail themselves of such an opportunity, they will contract directly with the service provider. The Alliance will not receive funds from these contracts nor bear legal responsibility for the service provider’s performance under the contract.

The HTA is a private sector initiative, and its future will not be determined by whatever happens, or does not happen, to the ACA. Regardless of governmental health care policy, the private sector has to confront the impact of rising health care costs, and the HTA is our approach to it.

The private sector has a good record in taking on big challenges like this. By working together, instead of company by company, we believe we can make transformational changes in the way health care benefits are provided that make health care more affordable. Because of the consolidation of the supply chain during the past four years, we know that CHROs and other corporate leaders have a strong desire for the services we will provide, and that gives us confidence we will be successful. This effort is being driven at the C-Suite level by the Founding Members.

No. The HTA is not an ACA-subsidized co-op. It is a private, employer-owned entity formed under state business cooperative laws. The Affordable Care Act subsidized insurance co-ops in an attempt to make sure there was a market for insurance plans in the ACA exchanges. That is not related to our effort.

For legal reasons, the HTA is labeled as a nonprofit cooperative, but it is better described as an alliance of major corporations working together to transform employer-sponsored health care for the better. Under the Alliance, service providers will compete on the basis of value and performance quality for the right to serve our members. As a legal entity, the HTA is self-governing and is obligated to the return of net revenues to the benefit of member companies.
The HTA is a market-based solution to the fact that Washington cannot solve the problems that unions and employers alike face in trying to provide robust health care options for their members and employees. Unlike the ACA co-ops, it is not an insurance company subsidized by the government. And unlike recent union co-ops, it is employer-based and focused on long-term market transformation rather than short-term discount plays.

Unions are trying to create a co-op because they, like all other entities concerned about the state of health care, are looking for new solutions.

The HTA, however, takes a markedly different approach. A normal union practice is to conduct its activities through consultants with whom it is closely aligned. Under the HTA, service providers will compete on the basis of value and performance quality for the right to serve our members. The HTA is self-governing and is committed to the return of net revenues to the benefit of member companies.

Further, union plans often focus on short-term discounts. The HTA, in contrast, will pursue transformation of the delivery system that is at the root of our health care cost explosion. The aggregated purchasing power of the HTA certainly holds the promise to generate early and significant savings, but that power will also be directed toward sustainable long-term savings. Such savings will ensue when (and only when) we transform provider behavior from focusing on sick care to a system grounded in prevention and wellness.

The HTA is a market-based solution to the fact that Washington cannot solve the problems that unions and employers alike face in trying to provide robust health care options for their members and employees.

No aspect of the Alliance will pre-empt or interfere with any collective bargaining agreement. The extent to which a member company includes its employees covered by a CBA will be determined by the terms negotiated by the member in its CBAs.

The HTA will give benefit managers additional leverage in making purchases and present them with additional options for designing health care plans. In addition, benefit managers will appreciate the HTA’s role in vetting new technologies from an impartial perspective, giving them even greater ability to benefit from new technological breakthroughs. Further, current practices prevent employers from using health care transactional data to figure out the best way to deploy their resources. Benefit managers will gain greater insights into what works and what doesn’t through the HTA’s data analytics capacity. Benefit managers also have had significant input into the planning of the Alliance, and many have expressed their appreciation that participation in the Alliance may free up resources and time for benefit managers to pursue other priorities, such as promoting employee health and wellness. Members will use the offerings of the Alliance as much or as little as they choose.

Former Deputy Secretary of HHS Tevi Troy is the CEO of the American Health Policy Institute, a 501(c)(3) think tank formed in 2014 to help employers think through some of the challenges they are facing in providing employer sponsored health care. One of the missions of the American Health Policy Institute has been to explore new options for large employers for providing quality and affordable health coverage to their employees. In that capacity, the Institute developed the concept that has grown into the Health Transformation Alliance. In addition to his role at AHPI, Dr. Troy will also be serving as the Executive Vice President for Public Policy of the HTA.

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