Why Did It Take So Long To Realize PPO’s Suck?

Agents, brokers and consultants, once so welded to the status quo, are now some of the most vocal and ardent supporters of the movement away from PPOs……………

By Bill Rusteberg

Why is it that brokers / consultants are just now jumping off the PPO bandwagon in droves and embracing non-network strategies for their clients?

I can’t answer that question with any certainty.

“Bill, I sense a fundamental transition in the market, a watershed moment and I too can’t tell you what’s causing it” opined a friend recently. “Its like someone turned on a light just yesterday, creating a rapid market momentum towards change which seems unstoppable.”

What’s fueling this?

Moving away from PPO’s is not new. We have been doing that since the mid 2000’s here in Texas. In the beginning there was fierce opposition to our strategies. Carrier reps were the most aggressive, selling fear of balance billing, lawsuits, and credit dings. Some even went as far as to attempt to get local hospitals to circle the wagons in a collaborative effort to defeat our efforts. So I certainly understand why agents, brokers and consultants during those early years looked askance at these strategies and choose to remain within the status quo.

But the early years quickly established legitimacy of the process. The paralyzing fear of balance billing, lawsuits and credit dings proved essentially unfounded. Empirical evidence proved significant savings of 40% and more, above and beyond PPO “discounts.” Providers accepted our members and cashed our checks.

The Big Bad Wolf failed to blow the house down. The blow back quickly became an occasional whiff. 

Agents, brokers and consultants, once so welded to the status quo, are now some of the most vocal and ardent supporters of the movement away from PPOs. Some have joined associations of other like minded outside-the-box believers forming energized cartels of missionary warriors hell bent on destroying PPO’s and replacing them with Reference Based Pricing, Direct Contracting and other common sense strategies.

So back to the original question – Why now? Why now are brokers and consultants so excited about “spreading the word” on a decade old strategy?

Maybe it has to do with health care financing. With their financial backs to the wall, plan sponsors are more receptive to change. They are eager, hungry for knowledge about health care cost drivers. They are willing students. Once they learn the truth behind rising health care costs they get pissed, really pissed. That’s when the “Me Too” brokers and consultants take note and join the growing “anything but PPO’s” movement around the country.

So I think the driver here is (1) Financial, (2) Knowledge based decision making on the part of plan sponsors using common sense and traditional American business practices and (3) a handful of early adopter brokers who have done a phenomenal job in stirring up the market and catching the attention of their competitors.

So the driving force for broker / consultant behavioral change could be due to “If you can’t beat them, join them” Or is it “Yeh, me too, I don’t like PPO’s either………….”