{"id":3826,"date":"2025-07-08T15:53:27","date_gmt":"2025-07-08T15:53:27","guid":{"rendered":"https:\/\/aomtodayprod.wpenginepowered.com\/?p=3826"},"modified":"2025-07-08T15:53:27","modified_gmt":"2025-07-08T15:53:27","slug":"why-executives-have-to-take-responsibility-for-healthcare","status":"publish","type":"post","link":"https:\/\/www.aom.org\/today\/why-executives-have-to-take-responsibility-for-healthcare\/","title":{"rendered":"Why Executives Have to Take Responsibility for Healthcare"},"content":{"rendered":"

By Daniel Butcher<\/a><\/p>\n

Many U.S. CEOs and CFOs see health insurance as a nice benefit that they subsidize for employees, but it isn\u2019t part of their organization\u2019s strategic plan, and they don\u2019t see it as part of their responsibility, even though a healthier a workforce is a more productive workforce.<\/p>\n

Academy of Management Scholar Jeffrey Pfeffer of Stanford University<\/a> said that most C-suite executives delegate benefits administration to human resources (HR), which in turn delegates it to a benefits specialist or team, who, in many cases, delegates it to a benefits consultant such as Aon Hewitt and Mercer.<\/p>\n

\u201cIt gets delegated out, and nobody is providing the oversight that they should,\u201d Pfeffer said. \u201cWe have vendors that have hours only during working days, which means if your employees have to engage with their vendor, they have to do it during work time\u2014I don\u2019t think most companies are paying their employees to deal with that.<\/p>\n

\u201cThe employers should be looking at percentage of claims denied, how much time employees are having to spend hassling with their administrators, and whether the administrators are doing a good job, just as you would look at any other vendor,\u201d he said. \u201cIf I hire McKinsey as a consultant to provide some strategic insight, I would ask, \u2018At the end of the engagement, did they do a good job? Do I know something that I didn\u2019t know previously?\u2019<\/p>\n

\u201cEmployers hold vendors accountable in every domain except for this one, healthcare, which is considered to be too weird or too complex, and so employers have offloaded a lot of responsibility without any oversight, and that missing oversight is why we have the problems that we have.\u201d<\/p>\n

Oversight of employers should extend not only to what benefits are accepted, but also the administrative burdens on employees for getting the benefits that they pay for, especially during the process for appealing denials.<\/p>\n

\u201cOne of the reasons why the U.S. healthcare system is so expensive, why healthcare costs so much here, even though, by any measure of performance, the U.S. does not rank in the top 20 in the world of industrialized countries in the quality of healthcare, is because of this enormous administrative burden,\u201d Pfeffer said. \u201cYou have people who are trying to get authorization for services and others who are fighting overbilling.<\/p>\n

\u201cYou have people who are making marketing claims to sell this stuff to people,\u201d he said. \u201cIn the U.S. health insurance and benefits administration industries, you have all kinds of stuff, none of which adds value or provides healthcare, and this administrative burden is why healthcare costs so much in the U.S.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

By Daniel Butcher Many U.S. CEOs and CFOs see health insurance as a nice benefit that they subsidize for employees, but it isn\u2019t part of their organization\u2019s strategic plan, and they don\u2019t see it as part of their responsibility, even though a healthier a workforce is a more productive workforce. Academy of Management Scholar Jeffrey […]<\/p>\n","protected":false},"author":4,"featured_media":4124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27,19,78,46],"tags":[],"sp_smart_badges":[],"ppma_author":[70],"class_list":["post-3826","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-c-suite","category-leadership","category-policy","category-well-being"],"acf":[],"yoast_head":"\nWhy Executives Have to Take Responsibility for Healthcare - Academy of Management Today<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aom.org\/today\/why-executives-have-to-take-responsibility-for-healthcare\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Daniel Butcher\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/\"},\"author\":{\"name\":\"Daniel Butcher\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/#\\\/schema\\\/person\\\/d1297a59039d9ca7bac9d9f0952e508c\"},\"headline\":\"Why Executives Have to Take Responsibility for Healthcare\",\"datePublished\":\"2025-07-08T15:53:27+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/\"},\"wordCount\":454,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.aom.org\\\/today\\\/wp-content\\\/uploads\\\/2025\\\/04\\\/doctor-mom-boy.jpg\",\"articleSection\":[\"C-SUITE\",\"LEADERSHIP\",\"POLICY\",\"WELL-BEING\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/\",\"url\":\"https:\\\/\\\/www.aom.org\\\/today\\\/why-executives-have-to-take-responsibility-for-healthcare\\\/\",\"name\":\"Why Executives Have to Take Responsibility for Healthcare - 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