Employers Fed Up With Insurance Companies

Any employer who relies on payer contracts they can’t see has got to be dumb…….

By Bill Rusteberg

More self-funded employers are realizing they can get better deals in partnership with local providers instead of relying on out-of-state and out-of-touch third party intermediaries.

Why is that so? Well, our three readers should have a pretty good understanding by now. Over the past 13 years this blog has exposed all the secrets the health care industry doesn’t want you to know.

For example, a clear understanding of “Working The Spread” will make your toenails curl once you realize where your money is going (hint, not all of it goes to health care). Remember that blog entry some time ago where a plan sponsor learned his insurance company was skimming 9.6% of the discount savings and disguising it as a claim cost?

Any employer who relies on payer contracts they can’t see has got to be dumb. Common sense dictates that you don’t enter into a contract without knowing what its going to cost you.

CFO: “Hey Boss, let’s go with Blue Cross this year. They have the best network! Everyone is on it!” Besides, everyone in the universe recognizes the Blue Cross logo which will be on our I.D. cards.

CEO: “What percentage of Medicare will we be required to pay our local hospital? And have you reviewed the Blue Cross hospital contract with our local hospital?

CFO: “No boss, they won’t let me see the contract and when I asked the Blue Cross rep. what percentage of Medicare our self-funded plan would be required to pay, she said ‘Sorry, that’s confidential information and I can’t tell you.”

CEO: What!! It’s our money! Tell them to Go To Hell. Tell our TPA to begin processing all claims at a straight % of Medicare. And give me a list of providers our employees have been using so we can reach out to them on a direct basis.

CFO: Ok boss. But what do I say to the providers when they call?

CEO: Ask them if they take Medicare. If they say yes, then say “Great. You’re gonna really like what we are gonna pay you because its more, a lot more, like 20% more or even higher if we can agree. Tell them we’ll pay them quickly, in fact so fast it will make their heads spin. And tell them they won’t be required to jump through hoops, rules and regulations typical of managed care contracts, that all we want them to do is to get paid the right way and to practice medicine….. and not spend 40% of their time dealing with onerous administrative duties. Then email them one page, 190 word Letter of Agreement” for their signature.

More employers are reaching out directly to local providers these days. The following article is an indication of that trend:

Employers, fed up with insurance companies, turn to ASCs

Laura Dyrda – Tuesday, April 27th, 2021  Print  | Email

Employers are increasingly interested in direct contracting with surgery centers through regional and national contracts, and ASCs are ready partners as high quality, low cost sites of care.

“As the cost of healthcare benefits for employees continues to rise, we are seeing continued requests for contracts that allow employers to provide high quality care services to their employees at a significant cost savings to the employer,” said Mike Grant, administrator of Surgery Center of Amarillo (Texas).

Direct-to-employer contracting can provide an additional revenue stream for physicians and surgery centers, especially if commercial payers are narrowing their networks and lowering reimbursement rates.

“ASCs that have an ability to bundle their services for specific procedures will have the opportunity to negotiate directly with self-insured employers, enabling their employees to get concierge-type services at reduced rates. By doing so, employers will reduce their loss time injuries and ensure that their employees receive high quality services in a controlled environment,” said Christina Goodall, RN, DNP, administrator of Atlanta Orthopedic Institute.

Nader Samii, CEO of National Medical Billing Services, and Alison Kuley, senior spine coder at the company, advised ASCs to enter into direct-to-employer contracts with specific companies to drive more spine surgeries to the facility in a September 2020 Becker’s article. They said ASCs could approach large employers with a discount for employees in exchange for encouraging employees to select the center.

“Given the significant cost of spine procedures, this will be very attractive to employers and will provide employees with a high-quality destination for their surgeries,” they wrote.

National ASC chains are also engaging in direct-to-employer contracts. ValueHealth, which has a network of ASCs across the U.S., offers a program to employers, SurgerySavings, to provide surgery for employees. The company claims to provide more than $10,000 in savings per episode of care on high-value procedures.

Dallas-based United Surgical Partners International executives are in the early stages of developing direct-to-employer, value-based contracts for its surgery centers.

“It brings USPI centers and doctors’ patients from distant geographies based upon employers that are looking for high quality and high values,” said Saum Sutaria, president and COO of Tenet, USPI’s parent company, during the first-quarter earnings call April 21.

The American Medical Association recommends physicians entering into direct-to-employer contracts make sure contract language is clear that employers control the plan, but not the practice of medicine. The contract should also cover data-sharing and stewardship, compensation, patient privacy and expected timing for progress reports.

RiskManagers.us is a specialty company in the benefits market that, while not an insurance company, works directly with health entities, medical providers, and businesses to identify and develop cost effective benefits packages, emphasizing transparency and fairness in direct reimbursement compensation methods. MedSave Management LLC, a RiskManagers.us company, provides direct provider contracting for Reference Based Pricing plans