By Craig Gottwals
In this case, a cool $64 million over the next 11 years awaits. Will you seize it?
On Tuesday, I looked at the 5-year cost of a move to reference-based pricing. I used the latest Milliman study as the basis of that analysis and looked a 300-employee group. For this one, we use, mostly, the Kaiser Family Foundation data, extrapolated into a PEPM with a slight adjustment based on The Mahoney Group’s book of business. And this assumes 500 employees.
Reference-Based Pricing (RBP) is a form of self-funded health plan that reimburses providers at a set percentage above Medicare or above the hospital’s self-reported costs, whichever is greater, delivering transparent and predictable costs for employers and employees. Seven of my last eight new clients coming in have opted for one form of RBP or another. I feel like I’m letting them down as a trusted advisor if I don’t show them RBP, the most powerful cost containment mechanism in all of American healthcare.
2016 through 2024 is based on actual data. 2025 and beyond is, obviously, a projection. But it is a pretty conservative one based on past performance. If there is one thing we know in healthcare and benefits, it is that change is constant.
The potential savings for a 500-employee company are staggering. Shoot me a message. We’re doing this with all kinds of narrow-margin businesses. We’d be honored to help.
Reading Assignment For Today: The Cost of Convenience
