Less is Better

It started three years ago with employers beginning to realize the fallacy of PPO network discount “savings” and finally doing something about it. Bill Miller BBQ, a San Antonio based restuarant chain, was the first employer in Texas take the initiative which started the Cost-Plus revolution (Bill Miller Forbes).

Relying on less providers to provide health care makes sense for both the consumer and the provider. It has certainly worked well for Bill Miller BBQ and over 45 other employer groups in Texas that have followed their lead.

Providers get paid a fair and reasonable fee, quickly and hassel free while consumers enjoy significant savings. And, the situation gets even better with improved benefits to the employees, and less Accounts Receivable problems for the providers.

With the savings realized, calendar year deductibles can be removed, hard to track out-of-pocket expenses are eliminated, replaced with a co-pay system in place for all benefits, including hospital admissions. Patients know up front what their cost will be, and providers know up front what their reimbursement will be too. No secretive PPO contracts to worry about – total transparency.

 Now that Health Care Reform has passed, carriers are scrambling to make sense of the bill, and devise strategies to survive competitively in the upcoming months and years. Carriers are beginning to realize that “Less is Better” too, as outlined in a recent article (http://www.nytimes.com/2010/07/18/business/18choice.html).

In an earlier posting, we noted that there will be tremendous opportunities for those of us in the insurance industry that have the ability to think out of the box and seize upon events as they unfold in the marketplace. We promised to post a piece on “Opportunities Before Us that Will Make Us Millionaires” in total, however with things moving so rapidly these days, we decided to provide this posting as a hint of future postings to be made here for the benefit of our four readers (yes, we added one new reader over the weekend – thank you Dino).