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Really Want to Control Your Health Spend?

1) Understand that price is the major driver behind spend. The Health Care Cost Institute's 2017 Health Care Cost and Utilization Report found that the total cumulative change in price from 2013-2017 was a 17.1% increase while utilization remained relaitvely stable. Overall spend increased 16.7% for this same time period. 

(2) Continue effective traditional approaches to control cost. Willis Towers Watson's 2018 23rd Annual Best Practices in Health Care Employer Survey found employers taking these steps:

  • Concentrating on clinical conditions that drive high-cost claims
  • Better managing pharmacy, especially specialty pharmacy
  • Increasing utilization of centers of excellence, telemedicine, and high-performing networks
  • Evaluating "low point-of-care cost plans" as an option
  • Focusing on employee total "well-being"

You might think that the most effective way to decrease spend is to reduce the amount of care needed and used. But the industry has traditionally responded to utlization decreases with price increases resulting in keeping themselves "whole" and increasing your spend. 

(3) Pair effective traditional cost control approaches with explicit price control/reduction strategies, such as Medicare contracted reference-based pricing (i.e., no balance bill to patient). Other new payment models, such as bundled pricing, captitation, and global payments may also stem the tide of rising prices, but only if the negotiated price is set at a fair level and subject to resetting over time.

(4) Shift care to lower-price sites of care, such as home dialysis, freestanding infusion centers, ambulatory surgery centers.

These are just a few strategies that you should consider adding to your spend management. 

Posted by Cristie Travis at 8:16 AM

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