By Chris Deacon – Speaker. Thought Leader. Truth Teller. Disruptor. *All Content non-AI Generated*
I have to give Cigna Healthcare credit. This may be the most transparent explanation of why employers need transparency.
In a few short paragraphs, Cigna openly acknowledges that it may receive revenue from vendors it selects, vendors it steers business toward, formulary arrangements, out-of-network negotiations, subrogation recoveries, and affiliated companies providing services to employer health plans.
That’s refreshingly candid.
The irony, of course, is that Cigna is one of the most aggressive carriers when it comes to limiting employer access to the claims, payment, vendor, and financial data necessary to determine how much money is actually flowing through these arrangements and whether they affect plan costs or decision-making.
So employers are left with a curious form of transparency:
“Yes, these conflicts exist.”
“Yes, we may profit from them.”
“No, you can’t have enough information to determine how much, how often, or how bad.”
Cigna is effectively making the case for employer transparency legislation better than most transparency advocates ever could!
Every category disclosed here represents real conflicts of interest.
If Cigna receives compensation from a vendor, it has an incentive to select vendors that generate revenue for Cigna rather than vendors that generate the best outcomes or lowest costs for the employer.
If Cigna is paid for steering business to a vendor, it has an incentive to drive utilization toward that vendor regardless of whether competing solutions offer better value.
If Cigna receives compensation tied to formulary placement, it has an incentive to favor drugs that maximize its own revenue, even when lower-cost or clinically comparable alternatives may be available.
If Cigna receives a percentage of payment integrity recoveries, it has an incentive to allow improper payments to occur in the first place and then profit from finding and recovering them later.
If Cigna receives a percentage of out-of-network savings, it has an incentive to anchor negotiations against inflated billed charges because larger starting numbers create larger reported savings and larger fees.
If Cigna’s affiliates provide services to the plan, Cigna has an incentive to direct business to companies it owns and pay them more, thereby increasing revenue within the corporate family.
In the end, this may be the most effective argument for employer data transparency yet.
So, thank you Cigna Healthcare (Evernorth Health Services).
Now that you’ve openly disclosed all the ways you can profit from a health plan, withholding the data starts to look a lot less like protecting proprietary information and a lot more like protecting the grift.
