Self-Insurance Expert
Bending the Cost Curve
When battling ever-rising healthcare costs, do you sometimes feel like Sisyphus of Greek mythology—always facing an uphill battle that never ends?

Many employers with fully insured plans have never considered partial self insurance; for the rest, too many of them have been willing to focus almost exclusively on the fixed costs of administration and stop-loss insurance, as if the variable claims costs cannot be affected. The adage, “The claims are the claims” does not need to be true. These employers might even have taken the advanced step of adding an on-site clinic, but if they stop there they are greatly sub-optimizing their opportunities.

 

Consider the options below. Wouldn’t your employees be better off and healthier (and wouldn’t you spend less money) if the employees had access to actionable quality information? We use or consult on these tools below:
Tools in the Battle Against Healthcare Costs
Statistically Valid Surgeon and Hospital Quality Data
Unbiased, statistically valid quality information on surgeons and hospitals (with rankings from 100 to 800) by type of surgery is finally available. This is based on unbiased Medicare and Medicaid data and is weighted for severity— and, by the way, the best quality doctors tend to have lower overall costs dues to fewer complications. Sadly, one of the premier Centers of Excellence in the country has a worst possible rating of 100 for some mainstream surgical procedures. Would your employees know that if they went there? They can now. The program provides the most detailed and unbiased information available, even down to the specific medical procedure.
Transparent Drug Pricing and Specialized Rx Cost Containment
One of the largest components of increased medical spend is the rapid rise of prescription drug costs, with a special emphasis on specialty drugs. Traditional PBMs make their money off of the spread between what they buy the drug for from the pharmacist or drug manufacturer and what they charge the plan. A newer approach is a transparent fee-based model where the PBM only makes money off of its clearly disclosed fees. Whether the transparent model saves money is not automatic, but rather requires special analysis.
Reducing Administrative Costs, Including Stop-Loss Coverage

Most consultants do a fair to good job on shopping the market for stop-loss coverage, but there is much more to shopping for the best program than most realize. Consultants generally have access to traditional markets but do they also have access to specialized pools that offer no lasers for as long as the client remains insured, with premiums capped at very low levels (see www.gibraltarstoplossplan.com)? Special dividend-paying pools, captive programs, and carved out Rx-only stop-loss coverage? also exist. Does the consultant’s report show options such as aggregating specific contracts (not to be confused with aggregate coverage)? Does it show gapless contracts if a 12/15 contract is shown, and if a 12/15 or 12/24 is shown, is it compared to a paid contract, with or without the Terminal Liability Option (TLO)?  If different deductible limits are shown, are Monte Carlo simulations run to see which option is likely better, based on past claims experience? There is much more here than most people realize.

Vitally Important Second Opinions from World-Leading Specialists at No Employee Cost
It is now possible to attack the serious national problem of improper diagnosis and faulty treatment plans. 60% of the largest employers have now expert second opinion programs, but fortunately those programs are now available to the smallest employers. One vendor found with one of its largest clients that its orthopedic surgeons experienced a 63% change in diagnosis, and 56% of the original proposed surgeries were cancelled or switched to a less invasive procedure. How much help would you and your employees receive if you could duplicate that result?
Controlling Consulting Costs
Yes, it is possible to negotiate consultant compensation. Some consultants charge reasonable fees and provide good value, but others can gouge without the client even knowing it. Has the consultant offered any kind of performance guarantee? A business relationship should be transparent.
Insure Only Those That You Need to Insure
With the high cost of health insurance, it only makes sense that a cost-conscious employer would want to cover only those employees and dependents that they needed to. Dependent audits can be helpful to make sure only eligible dependents are covered, but beyond that it is possible to set up special dependent eligibility tests so that a spouse who is eligible for other coverage is not eligible for your plan or has to pay a premium. (While some employers attempt to offer pre-tax payments as inducements for spouses to take other coverage, that needs to be examined closely before going down that path.)
Negotiated Hospital Costs

Is the cost your health plan pays for hospital charges a function of their true cost to provide services or instead whatever the market will bear? Hospitals are required to provide the federal government with their true internal costs in order to receive Medicare reimbursement, and yet too often hospitals charge commercial clients more than 250% or more of what they accept from Medicare. (The American Hospital Association in 2019 determined that on average Medicare and Medicaid paid hospitals about 13% below their costs, and 34% of hospitals were even paid by Medicare at cost or higher—so do we really need to pay for a 100-300% mark up?) It is time to do something about that. There are tools that can be used to negotiate a fair level of reimbursement from hospitals. It might be the best investment you make all year.

Data Analytics
It is possible to use sophisticated tools to analyze medical and prescription drug claims in order to potentially achieve a host of plan objectives, such as:

  • Find the members who have gaps in care, which can include those not using their medications on a timely basis.
  • Find the diabetics or other seriously ill members who do not appear to be following their treatment regimens.
  • Determine the cost effectiveness of an on-site clinic.
  • Analyze the Rx usage to look for waste or abuse (including opiods).

These are just some of the potential uses of a sophisticated data analytics program, which holds the potential to find tomorrow’s large claimants today. If that goal is met, everyone wins.