Would We Be Better Off If Employers Stopped Paying For Health Insurance?

Editor’s Note: Reinhardt is a genius. He has started a great debate:

By UWE REINHARDT

In his “Are Employers to Blame for Our High Medical Prices?,” David Dranove takes issue with my statement in a New York Times blog post:

“One reason for the employers’ passivity in paying health care bills may be that they know, or should know, that the fringe benefits they purchase for their employees ultimately come out of the employees’ total pay package. In a sense, employers behave like pickpockets who take from their employees’ wallets and with the money lifted purchase goodies for their employees.”

He writes:

“The correct economic argument is a bit more nuanced. Employees do not care about the cost of their benefits; they care about the benefits. If an employer can procure the same benefits at a lower cost, the employer need not increase wages one iota. In this regard, there is nothing special about health benefits. Suppose an employer offers employees the use of company cars. Workers don’t care what the employer paid for the cars, and if the employer can purchase cars at a deep discount, it will pocket the savings.”

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Reference Based Pricing, Individual Responsibility & Willing Providers

booker

By William Rusteberg

Reference Based Pricing with limited balance billing advocacy and legal defense services is the “grown-up” way of offering employer sponsored health insurance.

We have all been worried about the effects of balance billing…………..upset employees, lawsuits, dinged credit, etc. But, if an employer educates his workers (Ah yes, just another chore for HR), for the first time plan participants will  understand that they have skin in the game. It’s called individual responsibility……………money affects behavior.

Balance billing advocacy and legal representation could continue to be important for emergency hospital admissions, while non-emergency services can be shopped for the best pricing and outcomes. Hospital bill audits would continue to be an important part of plan management, fulfilling fiduciary duties through prudent business practice.

There are service providers active in this market and more to enter, we expect.

The future, we believe, is in direct contracting with a limited number of willing providers at rates that are more attractive to providers than government reimbursement rates, yet less than the sometimes exorbitant managed care rates we see routinely. Proprietary panels of providers for specific employers ensures quick and efficient access to medical care versus waiting for days and weeks to see a primary care physician, or even months for a specialist once ObamaCare takes full effect in 2014.

Employers can and should initiate direct contact with their local provider community now.

http://blog.riskmanagers.us/?p=10699

Medical Care Consultants Inc.

clinic

Medical Care Consultants, Inc. (MCC) provides High-quality, low-cost, convenient healthcare that saves companies, employees and their dependents money on medical claims costs. MCC will provide a turnkey employee health clinic on or near site and is an “ADD-ON” to your current medical benefit program with NO PLAN CHANGES required.  With accessible and affordable care companies can save as much as 20% on their overall medical claims cost.

We will finance the start up cost to establish your employee health care clinic.    See www.mcchealthcenters.com

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