“PPO Discounts Are The Best”………………….I Don’t Agree.
Founder @ Altiqe | Turning Benefits Challenges into Strategic Success | Benefits Expert | Podcast Host | National Speaker
“PPO Discounts are the best”
I don’t agree.
Understanding the pricing is the best.
EXAMPLE: Same surgery, same facility, same SURGEON
⬆ Billed charges: $80,762
➡ PPO cost: $36,342
↘ Direct Contract cost: $11,522
⬇ Reference Based Pricing (RBP) cost: $10,527
🔄 Medicare cost: $5,790
Things to consider:
1 Hospitals cannot survive on Medicare, so they charge commercial members more. Topic for another day.
2 If a member doesn’t understand RBP (hint: members do not understand RBP nor do they care), there are other options, like Direct Contracts.
3 The user experience is important and “PPO” is the easy button that people who have insurance understand…..
As an employer, can you stomach an ~ 300% cost differential for surgeries?
I would argue no.
And more importantly, you should not be constrained to believe that “PPO” is your only choice.
