A recently published whitepaper demonstrates how employers can align benefit design with alternative payment models. Here are three ways employers can better design plan benefits to exercise more control over spending and create more value:

Negotiate value guarantees with carriers. Strategic engagement with carriers is key to implementing and optimizing value-based benefit design. Carriers can be tasked with quantifying potentially low-value services and held contractually accountable for performance guarantees. These guarantees should hold carriers accountable for decreasing low-value care while increasing high-value care. With benchmarks in place, employers have the ability to demand refunds from carriers when low-value utilization targets are not met.
Advocate for value-based rate adjustments. Employers may have limited control over payment models, but they still have the power to select carriers that offer robust APMs, as well as the ability to encourage carriers to expand and iterate models that work. While there is no doubt that the shift to value-based care is accelerating, the traditional fee-for-service system will continue to be the dominant form of payment for the majority of services for the foreseeable future. However, employers still have the ability to create value within that system by pressuring carriers to negotiate contracts that give rate increases to high-value, underutilized services while decreasing rates for low-value, overutilized services.
Lower cost-sharing by incentivizing high-value clinical services. Employers can keep cost-sharing low by using value-based insurance designs that waive deductibles and lower co-pays for high-value services. While the increased use of essential care is unlikely to generate significant short-term savings, it can mitigate unintended consequences of other changes to cost-sharing designed to reduce spending.

As more employers align value-based insurance design with quality-driven payment reform, they will begin realizing improvements to the health of their employees and beneficiaries while simultaneously enhancing the efficiency of their medical spending.

Instant Insights /

3 strategies for employers considering value-based insurance design

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