July 2018 •
Volume 20 •
Issue 7
Providing Current Information on
Health Insurance Industry Issues and Legislation
Montana's Reference-Base Pricing Experiment a Big Success
Two years ago the State of Montana turned to Reference-Based Pricing in an effort
to control its healthcare costs for state employees. The State entered into contracts
with its 60 hospitals to pay them based on a multiple of the Medicare rate for
their services. This year, the State will save millions versus what it would have paid
without the change. Setting a multiple of the Medicare rate that saves the State
money while enabling the hospitals to make a reasonable profit has been key to
Montana's success.
to control its healthcare costs for state employees. The State entered into contracts
with its 60 hospitals to pay them based on a multiple of the Medicare rate for
their services. This year, the State will save millions versus what it would have paid
without the change. Setting a multiple of the Medicare rate that saves the State
money while enabling the hospitals to make a reasonable profit has been key to
Montana's success.
Reference-Based Pricing (RBP) - Bending the Cost Curve
Smart payors who have had enough of ever increasing premiums are starting to self-
insure. Many are implementing or considering implementing RBP to reign in their
healthcare insurance spend. HHC Group helps payors big and small, their brokers and
TPAs determine if RBP is right for them. We then assist each payor in building and
implementing a customized Plan that best fits their individual needs and situations.
insure. Many are implementing or considering implementing RBP to reign in their
healthcare insurance spend. HHC Group helps payors big and small, their brokers and
TPAs determine if RBP is right for them. We then assist each payor in building and
implementing a customized Plan that best fits their individual needs and situations.
Small Business Owners Worried About Cost of Health Coverage
The cost of healthcare coverage for small businesses jumped by 8% last year, after
decreasing 1% the year before. 8 in 10 small business owners surveyed, said they
were worried about the cost of coverage. They say they need to provide coverage to
attract and retain employees, but the increases are limiting their ability to hire new
employees or award bonuses or raises.
decreasing 1% the year before. 8 in 10 small business owners surveyed, said they
were worried about the cost of coverage. They say they need to provide coverage to
attract and retain employees, but the increases are limiting their ability to hire new
employees or award bonuses or raises.
Healthcare Cost Increases Unsustainable
Healthcare costs are expected to grow by 6% in 2019, again increasing at about 3
times the rate of inflation. Health system consolidation and purchase of more and
more physician practices touted as cost reducers are actually driving costs higher.
So, too, is the greater access to care via telehealth, retail and urgent-care centers,
all of which many thought would help reign in costs.
times the rate of inflation. Health system consolidation and purchase of more and
more physician practices touted as cost reducers are actually driving costs higher.
So, too, is the greater access to care via telehealth, retail and urgent-care centers,
all of which many thought would help reign in costs.
Three Star Preferred Provider Program Additions
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