2007 Leap Into Uncharted Waters Saves Clients Millions

riskmanagers.logo“It has been seven years since our first client exited the managed care world. Subsequently more clients have embarked on the same journey, most with equally good results. None have returned to the world of managed care” – 

(Excerpt from Forbes Article by Dave Chase)

Bill Rusteberg produced a report (Beating Medical Trend – Managed Care vs Reference Based Pricing) on Reference-based Reimbursement that said the following:

In 2007 – 2008 we approached several of our clients to suggest something different to control costs. The concept was simple. Eschew managed care contracts in lieu of claim benchmarking off multiple data points such as Medicare reimbursement rates. Removing managed care contracts, i.e, PPO, and paying providers quickly, fairly and directly had an immediate impact on claim costs.

After 15 months we performed a study by running 100% of claims back through the prior PPO network reimbursement rates. This exercise proved a net savings of 43% above and beyond the PPO discounts we would have otherwise experienced. Instead of doing the same thing year after year, our clients did something different and it worked.

It has been seven years since our first client exited the managed care world. Subsequently more clients have embarked on the same journey, most with equally good results. None have returned to the world of managed care.

The graph below shows one example from a school district. Wise districts such as this one and those in Pittsburgh have recognized that teacher unions and management have common interest in tackling healthcare’s easily avoidable inflation if they put kids ahead of healthcare industry profits. Click on the image to see other similar examples.

chase

Reference-based reimbursement data (courtesy of RiskManagers.us) 

Click here for additional examples.

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Read Complete Article Here – https://www.forbes.com/sites/davechase/2016/09/05/have-ppo-networks-perpetrated-the-greatest-heist-in-american-history/#306e378b3330