Here’s a fact: Today we have unprecedented ability to save lives, extend lifespan, and improve health. Here’s another fact: We don’t have unlimited dollars to pay for this medical care.
The collision between medical advances and health care spending is leading policy experts, insurance companies, physicians and consumers to search for ways to expand quality health care — without bankrupting the system.
Efficiency is the goal. The mention of the word, however, can make people uncomfortable. How can you put a price on health? What is it worth, in dollars and cents, to suffer from fewer diabetes complications or to return to the track quickly after a running injury?
We should also realize that today’s health care innovators aren’t seeking to deny care or ration service. They’re implementing strategies to be more efficient. Delivering better health care, at a lower cost, is creating greater access for more Americans.
If you’re one of the health plans providing coverage, here’s an idea:
Select a small network of doctors and hospitals. Set criteria for quality and efficiency, and access to all specialties. Then negotiate hard on price, but not just unit price. Negotiate on the total cost of care and share risk. Together, remove administrative barriers, streamline patient care, and improve outcomes. That’s how you generate a long-term, sustainable solution.
The result is a high-value provider network.
Variations on the high-value network theme are being implemented by health plans across Wisconsin and the nation. And the results are impressive:
• Lower costs. A McKinsey study found that for 2015, median premiums for health plans with high-value networks are 15 percent to 23 percent lower.
• Quality care. There is no meaningful performance difference between broad and high-value networks, according to the study.
• Patient satisfaction. A Commonwealth Fund poll found that 94 percent of privately-insured Americans are overwhelmingly satisfied with the number of physicians, hospitals and other health care professionals in their plan’s network.
• Increasing popularity. A strong majority of Americans surveyed by Morning Consult say they prefer “less expensive plans with a limited network of doctors and hospitals” over “more expensive plans with a broader network of doctors and hospitals.”
As president of a benefits consulting firm, I’ve watched how this trend has played out in Wisconsin. Initially, high-value networks were implemented as a last resort due to their low cost. Today, leading high-value networks are taking risk, and coordinated care is driving payment reform and improving health outcomes. Premier employers are now successfully receiving the access their employees demand, improved quality of care, and reduced long-term premiums.
Of course, high-value networks are not right for everyone. No health care solution is. They are, however, essential options.
In some cases, the long-term cost savings can make the difference between a family affording health insurance or going without. They can enable a company to offer health benefits for the first time, and to finally gain the worker loyalty and productivity that ensues. Employee benefits can be a driver for attracting and retaining a quality Wisconsin workforce.
Sadly, additional, unnecessary regulation could soon eliminate some of these choices.
This would be a profound loss. In 2015 alone, patients around the nation gained access to more than 1,000 new health plans. Each health plan that gets introduced to the market represents another solution specially tailored to a different subset of health care consumers.
Taken together, a myriad of high-quality health plan choices will inevitably provide better, smarter, more efficient healthcare than any one-size-fits-all approach. Hopefully, Wisconsin’s insurance officials will keep this fact in mind. By doing so, we can ensure continued quality, innovation and affordability in the health care marketplace.
Jerry Frye is president of The Benefit Services Group Inc. in Pewaukee.
