20 HR Policy Members Announce Formation of the Health Transformation Alliance

February 05, 2016

Eleven months after the Association's 2015 CHRO Summit—at which there was consensus that a better way is needed to deliver health care to employees—20 HR Policy members, including companies who are part of the health care supply chain, have joined together to improve the way health care benefits will be purchased for employees in an effort to create better health care outcomes.  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.  Their goal, as described in a statement released today, "is to break with existing marketplace practices that are costly, wasteful and inefficient, all of which have resulted in employees paying higher premiums, copayments and deductibles every year."  "The current system is unsustainable and it costs our employees too much," said Kevin Cox, the Chief Human Resources Officer (CHRO) of American Express who serves as Chair of the HTA.  "Even the most successful companies won't be able to afford the rising costs of health care in the not too distant future."  According to Kim Hauer, CHRO at Caterpillar, "Our priority in this coalition is supporting positive health outcomes for our strongest asset—our employees.  Health care benefits are too important to our people for us to sit on the sidelines; the status quo needs to change, and we have to be part of the solution."  The initiative focuses on reforms to the supply chain that are designed to reduce redundancies and waste, all of which 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.  Regarding how the HTA plans to work with the supply chain, Kevin Cox said, "We are looking for innovators.  We want to identify and work with those who want to break from some of the traditional, costly ways the health care marketplace is working so that we can create a better way to purchase health care for our employees.  The HTA will be retaining a number of service providers to help it achieve its objective, and the Alliance will be strongly attracted to those organizations interested in helping us achieve those objectives."  Additional information regarding the Alliance can be found on its website.