Latest / Beyond the Paycheck / From Cost Shift to Care Shift: Tom Armani on Value-Based Primary Care and Personalizing Benefits
Transcript
- Kelsey Willock (00:01.474) Welcome Tom Armani, most recently the Director of Global Benefits at DayForce. We are so excited to have you on this Friday. For our audience, I'd love for you to share a little bit about your career and background, where you're calling in from, and your current role today. Tom Armani (00:16.92) Happy to do that. Again, Tom Armani, I am calling in from the Twin Cities, Minneapolis, Minnesota. And I have been a leader in the benefit space for the past 20 to 25 years. So we'll start there. Kelsey Willock (00:42.254) So I always love getting to know the folks that I interview more personally first. So before we dive into all the great things that you've done in the world of benefits and HR, I want to get to know you more personally. So if you'll indulge me, can you share with me your earliest memory of money? Tom Armani (00:54.296) you Tom Armani (00:59.446) I can, I came from a solid middle-class background. My dad was a blue collar worker. My mom was actually the associate dean of a nursing school, which was pretty progressive, but definitely instilled with a strong work ethic. you know, again, just a deep appreciation of the value of money. They definitely were. impacted and influenced by the depression. so again, there was, again, growing up, not a lot of extraneous spending on fast food or, you know, things that today would be considered fairly routine. again, I'd say that earliest memories would be again, this. depression era influenced perspective on the value of earning money, saving money, being diligent about how money's spent. How's that? Kelsey Willock (02:10.968) Perfect answer. What was your first job and do you remember what you did with your first paycheck? Tom Armani (02:18.496) I'd say first job was probably delivering papers as a paperboy, working in the neighborhood for neighbors pulling weeds. So I think it was cash only transactions back in the day. I'd say that first legitimate job was probably working at a gas station before college and then during college. working summer jobs in order to be able to save for money to spend at college. Assumption is that the first paycheck was more than likely spent because of just the age and. know, lack of responsibility when you're 16, 17. Kelsey Willock (03:12.014) How do you think your parents' money story, the values that they instilled in you, even your own experience making money for the first time, has shaped how you think about paying benefits for your employees? Tom Armani (03:27.97) You know, I think it makes me very cognizant of affordability issues with respect to paying benefits and honestly what it means to live paycheck to paycheck. think that, you know, again, I didn't grow up in a family where, you know, there was ever need, but there was never any type of extravagance or an abundance of excess disposable income. I mean, it seemed like my parents were in a pretty tight household. And, you know, I can remember, again, throughout my early career, you know, to certain extent, living paycheck to paycheck, but never being in a position where if a car broke down or a furnace went out, you know, it didn't cause a financial hardship. And You know, I think that that's more relevant now than ever today. think that one of the biggest threats to people in America is unexpected medical debt. again, just potential exposure to what an unexpected illness or unexpected hospitalization can do to people financially. Again, it can be extremely devastating and I think it's, again, it's difficult for people to get in front of that due to a lack of disposable income and just the tightness of where a lot of people are living day to day with respect to being able to save versus spending money on household necessities. Kelsey Willock (05:14.606) Yeah, I couldn't agree more with you there. I think that when you really unpack all the data, half of people making over $100,000 right now in the United States are living paycheck to paycheck. These are large salary numbers. And so what does that mean for the broader workforce? It means that people are having a harder time. And you're also completely right on medical debt. My dad actually works in the healthcare industry and works specifically with cancer patients and something that he had shared with me that I find really jarring is so many people that he works with are more afraid of debt than they are to die. The passing down of that debt to family members and it's because medical debt can be such a problem. Tom Armani (05:57.848) No, having, you know, having young adult children, I've got four daughters in between the ages of 25 and 33. You know, again, I see with, I see them struggle with the desire to be able to save, to someday purchase a home. But it's difficult. You know, two of them live in New York City. So again, saving there is virtually impossible and You know, it's a struggle, especially when they don't necessarily have the experience or the tool sets to know what that next best action is with respect to saving, how to save, where to put money. So it's interesting to observe through living vicariously through your children, I guess. Kelsey Willock (07:04.142) And they're coming up in a different world, Like affordability and home ownership right now is a real challenge with so many, you know, sounds like millennials and Gen Z, and their children. It's a pervasive problem. So I think it's actually a really good segue into kind of, you know, talking about what's going on in the world and today's challenges with benefits. Where do you think compensation and benefits are breaking down most often today? Tom Armani (07:33.783) Well, think a lot of employers and a number of professionals that are in charge of their company's benefits spend don't view it really as its own separate small business. If you're self-funded, your pharmacy and healthcare spend is more than likely your second largest spend behind. your compensation, what you're actually paying your people. You know, there are a lot of perverse misaligned incentives that are, you know, in that space that if people don't understand a lot of times they are following the advice or going down a path which isn't necessarily in their best self-interest as the steward of the employer's spend. You know, I'd say additionally, again, one of the challenges as a benefits leader is trying to wear that hat and beyond that fulcrum that kind of balances, you your responsibility from a stewardship perspective with you trying to grow and develop the employer's value proposition and also be an advocate for employees as they're trying to navigate the space. What I've seen over the last 10 years is really the development of an affordability crisis that employees are seeing more and more evident. For years, employers have cost shifted as they've seen ever increasing renewals and trend increases. And I think we've gotten to this inflection point where it is Tom Armani (09:34.391) becoming more and more difficult for employers to pass that burden on to employees. You're finding a lot of employers with high deductible health plans and benefit designs, which are exposing employees to a lack of first dollar coverage, where individuals are to a certain extent functionally uninsured. have the insurance. Tom Armani (10:03.672) to incur claims where they've got that first dollar cost exposure. So they're putting off things like preventative care, which, for the most part should be free if they really understand how the plans work, but they also will put off visits to doctors when things start to emerge in their own health journey. so... You know, think that as a country, we're very reactive with respect to how we approach medicine as opposed to proactive. And I think as a result, a lot of people, again, because of the potential first dollar cost exposure, end up putting off care in the short term that ends up costing them and employers a lot more in the long term. Kelsey Willock (10:59.246) On the subject of putting things off and talking a little bit about financial anxiety, people, given these high deductible plans, will put off care and then end up in the emergency room. And that cost is so much more expensive to the employer. But obviously, a lot of this has to do with where regulatory and law sits. at a certain point, things do need to change. I just wonder when they will change because continuing to expect employees to eat this cost eventually it becomes unsustainable. Tom Armani (11:33.655) Yeah, there's, I mean, there's, there's definitely a renewed focus on this from a regulatory concern. You know, there are politicians that are starting to ask the right questions. There are people like Mark Cuban that are lending their voice to, to the argument and to, you know, trying to put a spotlight again on the misaligned incentives with respect to how the overall health care system operates. mean, you've got You know, you got insurance companies that own provider systems that also own PBMs. And, know, again, it's in my opinion, it's all about following the money. You know, one of the things that I recently did was I put, I put in an arrangement with a company that is an aggregator of independent, advanced primary care. Kelsey Willock (12:03.789) you Kelsey Willock (12:15.278) V. Tom Armani (12:31.283) Again, in my opinion, there are some misaligned incentives with primary care with respect to health system owned primary care, where it's more of a place where they're not looking to solve health problems and get people better. It's more of a feeder system to specialists further downstream, which again is a revenue source for these health systems. Again, with health systems, all about heads and beds. It's not necessarily, you know, you're not going to drive revenue by fixing people on the front end. And so again, you know, one of the things I've recently introduced prior to leaving my former employer was an organization called the Align Marketplace that again, is a curator of independent. advanced primary care providers across the country, where it's a value-based arrangement, where there are actually fees at risk based on, you know, if they are able to improve people's health and there's a clinical reconciliation done at the back end to make sure that you're actually paying for value. I think that, I think you're going to see more and more employers begin to focus on value and I think that maybe jumping ahead of some future questions, I think one of the biggest challenges to employers right now is actually employee engagement. We connect and offer amazing programs through digital vendors, but if people don't really understand the benefit to them of engaging in these programs, You know, a lot of times they'll hear about them, but they won't participate. so I think what you're going to see is more and more future personalization where through technology, through AI, you're going to see more personalized outreach that engages people, you know, just in time with. Tom Armani (14:47.465) some of the solutioning that's out there that's specifically relevant to them based on their claims information, their biometric data, their personal spending habits, their preferences. So, you know, we all wear, we all wear, or rings or Fitbits or Apple watches. And, you know, a lot of times this data seems to be going into a black hole, but I think it's some time, at some point in the future, the data will all be connected where it will serve as a way to be a catalyst and trigger an outreach that is relevant to an individual where they'll be able to take an action. So again, I'm hoping we're gonna shift from this reactive framework to a more proactive framework where through functional medicine, through... proactive screenings and through proactive interventions tied to root cause, healthcare concerns, you're going to see more and more people that are trying to get in front of it as opposed to waiting to react to it. Kelsey Willock (16:00.878) How do get legal teams on board? Given the sensitivity of personal information is also continuing to grow, the personalization aspect as well as targeted marketing is often in conflict with legal teams and PII. So how do you think about that? Tom Armani (16:15.275) Yeah, I as employers, mean, you definitely need to be aware of the confines of HIPAA. you know, again, I think the solution there more is in contracting with organizations that have access to a lot of that information where they're doing outreach on your behalf as an employer, but you don't necessarily know who's participating or what an individual's personal health situation is. I mean, we do this currently, again, we engage with digital health programs where we're hooking up the health plan and the claims data with the digital health provider so that they can do targeted marketing specific to... an individual's health state without disclosing that information to the employer so that from a privacy perspective, the information is kept private. And there are, again, all sorts of BAAs and NDAs and all the legalese in place to make sure that that's above board. But the problem again is, in my opinion, until... until there's relevance to an individual with respect to, you know, that outreach really resonating because of something, you know, again, somebody is specifically dealing with where they can connect the dots. It's just, it's really tough to proactively drive that engagement. think, again, that's as the employer, you can put in the best programs and you can communicate and advertise them. You know, but the minute somebody leaves a webinar or moves on to the next topic, it just doesn't stick. Kelsey Willock (18:11.246) Yeah, I've done hundreds of these interviews in the past two years, and I would say the most common word that comes up is engagement and lack thereof of it with, you know, it's not just a problem in terms of the employees not getting value, the employer spending an exorbitant amount of money on something that goes unused. So figuring out how we can meet people when things are most applicable and also communicate the value. of things to them to get them to engage at a higher rate, especially given, you know, I get targeted marketing on Instagram. Like we are living in a world where it's no longer weird and creepy. It's, the norm. So how do we start bringing that culture into the workforce and treating our employees, you know, as even customers of the company. Tom Armani (19:02.315) Well, again, I think of my children and I think of the complexity of the healthcare world we live in. you know, again, you look at any person that's newly engaged in the workforce trying to enroll in benefits for the first time. And, you know, again, they don't have the advocacy or they don't have the guidance that's really necessary for them to help start to build. just remedial knowledge with respect to being able to advocate on their own behalf. It's fraught with concepts that are confusing and plans that have a ton of complexity, whether it's... you know, somebody trying to get a prescription filled where there are prior authorization requirements or somebody trying to understand, what it means to schedule an appointment with an in-network versus an out-of-network. mean, again, I think that, until we start to address healthcare literacy and, educating people, you know, at an early age, it's, it just makes that, that, that chasm. bigger and more difficult to bridge as people continue to participate with their employer health plan. It's not until they actually need it and are exposed to both the risk and the benefit that they really engage and have the necessity to learn. Kelsey Willock (20:47.822) So last question for you as we wrap up, what's maybe an experiment or a piece of financial advice that you can give our listeners? And I imagine it could be related to how to get yourself educated in terms of your health plan. But what would you say? Tom Armani (21:06.487) Um, you know, a couple of things come to mind. think, you know, specific to financing, it's, kind of like, again, understand like you're the next best action. you know, again, you don't understand the value of taking advantage of an employer match and retirement plan. You don't understand the value of putting money away into. an FSA or an HSA with respect to, you know, being able to leverage pre-tax dollars. you know, it's understanding the value of, of trying to create and save, for emergencies by using tools to create an emergency savings fund. but I think it's also, you know, Look to understand from an advocacy perspective where you can get help. A lot of employers do have advocacy partners. Don't be afraid to ask questions and I think don't be afraid to realize that this is confusing and it's challenging even for people that work in the space. Kelsey Willock (22:20.974) And I think when you understand that, it makes it a little less scary. So thank you so much, Tom, for all of your time, your wisdom, your candor. I really sincerely appreciate it, particularly as we head into this holiday weekend. Where can our listeners connect with you beyond this conversation? Tom Armani (22:38.689) You know, they can look me up on LinkedIn and again, I love connecting with people on the space. So again, happy to engage and accept any questions or outreach that people are willing to put out there. Kelsey Willock (23:03.126) Awesome. Well, please do reach out to Tom and hope you have a wonderful weekend. Thanks for the conversation. Tom Armani (23:10.175) I enjoyed it. Thank you. Have a great weekend.