The second largest expense for most companies is HealthCare with relentlessly increasing premiums. The burden is so onerous most larger companies have decided to Self-Insure and accept the risk themselves. Employee Health claims are a perceived fixed cost in the sense that the decision maker for the Employer (i.e. CFO, Owner) does not monitor the actual individual claims, other than to typically require their Employees to get approval for more complex HealthCare procedures.
Whether an Employee needs an X-Ray to find out if they broke their wrist, a blood test to check their cholesterol, or an out-patient surgery such as getting a mammogram, the Employee is provided with all the choices where they are going to have the procedure done whether that is at a Hospital, Surgery Center, Clinic, or facility that provides the services that they need to have completed, including the facility that offers the best price. Employers and Employees alike are provided an online portal to access all the info.
Most Employers are not aware that due to current regulatory oversight in the United States, Private Equity firms have been allowed to not only purchase equity interests in the Insurance Companies underwriting HealthCare policies; but, also have been actively acquiring equity interests in the HealthCare providers themselves such as Hospitals and Outpatient Clinics. In this children’s fable, the fox now owns the henhouse and the hens!
The Employer has not had a solution that can provide real-time comparative cost savings within the geographic area proximate to their business or where their Employees reside. This means that the Employer, systemically, is paying a substantial amount of money more on an annual basis to subsidize their Employee HealthCare than they need to be paying in most of the gateway and secondary Cities in the United States, where there are multiple choices available for the same HealthCare procedure.
The good news is that there is now an option for the Employer to engage the services of an online HealthCare appointment oversight service that operates on a performance based shared benefit basis without any set-up fee or monthly subscription fees.
Here is how it works. Eligible businesses or organizations which are those that pay for their own Employees HealthCare costs are known to be Self-Insured, and have been in business for over three (3) years. While any Self-Insured entity is eligible, typically half those businesses and organizations who have over five-hundred (500) W-2 Employees. Statistically, 98% of businesses with one-thousand (1,000) or more Employees.
Once they have signed up, they provide the service provider with their historical claims data for the past three (3) to five (5) years. That data provides a comprehensive benchmark showing what the Employer was paying for HealthCare services such as Colonoscopy’s, MRI’s, Blood Tests, and X-Rays prior to them engaging the services of the HealthCare cost optimization provider.
The cost savings that are being identified include: 1) Bloodwork, 2) Imaging, 3) Urgent Care, which does not require getting an appointment which can include getting diagnosed and treating maladies such as Back Pain, Cold or Flu, Cuts or Small Wounds, Diarrhea, Earache or Sinus Pain, Minor Fever or Headache, Minor injury such as a Sprained Ankle, Painful Sore Throat, Rash or Minor Allergic Reaction, Small Burns, Urinary Tract Infections, or the Employee’s Primary Care Doctor’s Office is closed. 4) Surgeries, which can include Cataract, Colonoscopy, Ear-Nose-Throat, Endoscopy, Gall Bladder, Gynecological Procedures, Hemodialysis, Hemorrhoid Procedures, Lumpectomy, Minor Orthopedic, Skin Procedures, Urologic Procedures.
Prior to this new technology, when an Employee needed a medical procedure, they would just make an appointment. As an Employer, you had no idea how much money that medical appointment was going to cost you. So, if your Employee needed an MRI Exam, you might be paying an additional $2,000 for the same exam where there was another In-Network HealthCare provider that your Employee could have made an appointment with that charged $2,000 less for the same procedure. Now, when your Employee needs a medical procedure, you know the total cost of every provider that is delivering the same service.
The HealthCare Cost Saving Service provider which uses a proprietary Artificial Intelligence (AI) technology that provides the Employer with the myriad of HealthCare Appointment options has historically achieved gross savings of 40-55%, which means that Employers engaging their services can expect a net 20-27.5% cost savings by signing up for their services. So, if an Employer is paying $1,000,000 a year to cover their Employees Outpatient HealthCare costs, they can expect to pay only $725,000-800,000.
After each month, the Employer will be billed $1 for every $2 that the HealthCare Medical Appointment Cost Optimization service provider has obtained for them. In other words, every time that the HealthCare Medical Appointment Cost Optimization provider saves the Employer $2, the month after those cost savings have been realized, based on the Employers historical prior HealthCare Claims provided to the service provider, the Employer pays back the HealthCare Appointment Cost Optimization service provider $1. Simply put, if you buy a carton of milk at a Convenience Store, such as 7/11, you are going to pay more for that carton of milk than buying the same carton of milk from a wholesaler such as Costco. The Employer has the option of having their Staff look up HealthCare procedure options in real-time when an Employee in need of a procedure makes a request to have a medical appointment or allow the Employee to utilize the online comparative cost pricing to identify the lowest cost provider for the same procedure in their geographic area.
The Employer can establish in their Employee Handbook their policy of allowing the Employee to schedule their own HealthCare procedures by indicating to them that it must be the most cost-effective one identified.
