Reference Based Pricing Gaining Attention

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Many employers have begun to adopt a strategy known as “reference pricing” to help reduce health care costs. Under this benefit design, employees get insurance plans that set price caps on certain services and procedures. Enrollees are allowed to use any provider. But if they use providers with fees higher than the “reference price,” they must pay the difference between the reference price limit, determined by the employer or insurer, and the actual charge.

http://www.fiercehealthpayer.com/story/reference-pricing-saves-insurers-patients-money/2013-11-19?utm_medium=nl&utm_source=internal

Monday, November 18, 2013

(SOURCE – http://www.allhealth.org/briefing_detail.asp?bi=310)

Many employers have begun to adopt a strategy known as “reference pricing” to help reduce health care costs. Under this benefit design, employees get insurance plans that set price caps on certain services and procedures. Enrollees are allowed to use any provider. But if they use providers with fees higher than the “reference price,” they must pay the difference between the reference price limit, determined by the employer or insurer, and the actual charge.

Reference pricing can help raise awareness among patients about price differences across service providers, and exert competitive pressure on high-cost providers to bring down their prices. But questions remain about this benefit design and the problems it aims to solve. Evidence has shown that reference pricing can lower costs and increase value in prescription drug plans, but what about medical and surgical services? Are there certain procedures in which reference pricing is likely to be more effective? What are the challenges to employers, insurers, and providers? What concerns might employees have under this design? Are there lessons for public coverage plans in this experience?

Belman Presentation (Adobe Acrobat PDF), 11/18/2013
Caballero Presentation (Adobe Acrobat PDF), 11/18/2013
Cowling Presentation (Adobe Acrobat PDF), 11/18/2013
Monti Presentation (Adobe Acrobat PDF), 11/18/2013

MUST READ MATERIAL FOR HEALTH CARE REVOLUTIONARIES:

Employers Test Plans That Cap Health Costs, The New York Times, 6/23/2013
Reference Pricing and Bundled Payments. A Match to Change Markets. (Adobe Acrobat PDF),Catalyst for Payment Reform; Health Care Incentives Improvement Institute, 10/1/2013
From Reference Pricing To Value Pricing (Adobe Acrobat PDF),Catalyst for Payment Reform, 1/1/2013
Stunning Results from California, National Center for Policy Analysis, 8/7/2013
Quality Matters. Health Care Price Transparency: Can It Promote High-Value Care?, The Commonwealth Fund, 4/1/2012
Closing the Gap: Reducing Price Variance in Health Care with Reference-Based Pricing, Castlight Health, 7/1/2012
Bending the Cost Curve with Reference Pricing, The Health Care Blog, 7/27/2013
Hospital Ratings are in the Eye of the Beholder, Kaiser Health News, 3/18/2013
Reference Pricing: Stimulating Cost-Conscious Purchasing and Countering Provider Market Power (Adobe Acrobat PDF),National Institute for Health Care Management, 10/1/2013
The Sleeper in Health care Payment Reform, The New York Times, 8/2/2013
Towers Watson/NBGH Employer Survey on Purchasing Value in Health Care, Towers Watson, 3/7/2013
High and Varying Prices for Privately Insured Patients Underscore Hospital Market Power, Center for Studying Health System Change, 9/1/2013
Hospital Quality Reporting: Separating the Signal from the Noise, National Institute for Health Care Reform, 4/1/2013
Ensuring Competitive Markets for Health Care Services (Adobe Acrobat PDF),Catalyst for Payment Reform, 1/1/2013
Wide Variation in Hospital and Physician Payment Rates Evidence of Provider Market Power, Center for Studying Health System Change, 11/1/2010
A Systematic Review of Reference Pricing: Implications for US Prescription Drug Spending, American Journal of Managed Care, 11/1/2012
Price Transparency (Adobe Acrobat PDF),Catalyst for Payment Reform, 1/1/2013
Payers Test Reference Pricing And Centers Of Excellence To Steer Patients To Low-Price And High Quality Providers, Health Affairs, 9/1/2012
Increases in Consumer Cost Sharing Redirect Patient Volumes and Reduce Hospital Prices For Orthopedic Surgery, Health Affairs, 8/1/2013

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