Reference-based pricing (RBP) works. This self-insured model brings a rational approach to employer-sponsored health care by leveraging the actual cost of a service and basing reimbursement on a fair margin above that cost. In doing so, RBP provides reasonable payments to medical providers and delivers significant savings to employers, who can save anywhere from 20% to 30% of their total health care costs.
And yet, at a time when costs are expected to climb, and organizations are seriously in need of better health care options, some companies are reluctant to leave their traditional plans behind.
Companies that have been providing RBP solutions and member support to health plans over at least the past 10 years have been collecting unique and valuable data. Now, these companies are on the precipice of delivering more advanced RBP solutions by harnessing the power of artificial intelligence (AI) to positively impact member experience.
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Powering care navigation services
AI synthesizes multiple elements of health care, such as claim and provider data, regional cost structures, and independent quality scores to help guide members to providers and facilities that deliver high-quality care and work well with their health plan.
This takes away the guesswork from members and helps route them to the best possible care at the lowest price. In addition to improving health outcomes, it also reduces costs for employers and plan members alike, while significantly minimizing the likelihood of balance bills.
The next evolution of AI will help create opportunities to proactively steer members to high-quality providers and facilities that historically accept RBP payments. This could include regular health maintenance such as notifying members when and where to go for routine tests and screenings.
With up-to-date member data like claim history, medical records, and prescriptions, AI can also help identify those at risk for certain diseases, systemic health issues, future hospitalizations, ER visits, and readmissions, assisting with navigation of a member's care before they get sick.
A personal guide for your health care journey
We've all experienced what it's like to have a friend or loved one trapped in the health care ecosystem. Lost and afraid. Overwhelmed by multiple providers and bills and struggling to decipher information and instructions from different sources.
The questions seem endless. Where do I go for care? Who is the best provider? The best hospital? How much will this all cost? Will my insurance cover it? The list goes on.
Having a trusted advocate makes all the difference for anyone going through this situation. When those advocates have access to relevant and critical health care information, it completely transforms the decision-making process from "in the dark" to "informed."
That is where the benefit of utilizing AI and a data-driven approach can have a dramatic effect on the health care journey. The information that AI delivers effectively smooths the rough edges of RBP by supporting the care journey, while also reducing costs.
Ultimately, this combination can bring a sense of stability and comfort to one of life's most challenging experiences, both in terms of physical wellbeing and finances.
AI is the ultimate game changer
They say that "data is king," but it's only as valuable as your ability to process it, make sense of it, and use it to make informed decisions.
It's no secret that large traditional health plan organizations have access to endless data sources. Ideally, these would be mined to effectively guide members and help them save on health care costs.
Unfortunately, it's also true that "cash is king." Considering the additional data that health insurance conglomerates can access through contractual relationships with hospitals, tremendous opportunity exists to reduce costs for members and support smart care decisions.
The federal regulations being implemented to increase transparency are a step in the right direction, but there are several large systemic hurdles that need to be resolved. So, for businesses that are ready to save now and improve their employees' health care journey immediately, the solution lies elsewhere.
Smart providers are using AI to accomplish these tasks by harnessing the power of data and vast experience. This allows them to better serve the health plan and health care journeys of employers and the employees they sponsor.
This is exactly the impact that we're seeing with RBP today, and the future looks even brighter. The power of AI will continue to influence RBP health plans and the health care industry overall. It promises to be a great news reel.
Brian Atkinson is the Chief Operating Officer for ELAP Services, a leading health care solution for self-funded employers across the U.S. Founded in 2007, ELAP leverages almost 15 years of data to power its negotiation models and help organizations reduce their healthcare spend.
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