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Employers Score Savings When Patients Shop By Price

Margaret Dick Tocknell, for HealthLeaders Media, October 20, 2011

An Anthem Blue Cross and Blue Shield pilot program under way in three states aims to determine whether cash incentives offered by employers can move healthcare consumers to select low-cost facilities for medical care.

Smart Shopper is being piloted by self-insured employers in Connecticut, Indiana, and New Hampshire by Anthem Blue Cross and Blue Shield. The on-line program is offered as part of health insurance benefit packages and is voluntary for employees.

Chris Ulbrich's family-owned stainless steel and special metals manufacturing business in North Haven, CT has about 300 employees participating in the Smart Shopper pilot. The company pays about $7 million annually for health insurance benefits. "We've cost-shifted about 25% to our employees but we were looking for other ways to trim our expenses when this program came along."

Based on 2010 utilization Ulbrich's company expects to save about $160,000 on medical services during the one-year pilot. That includes any incentive payments and the administrative costs of the program. "At that rate in six years we'll save almost $1 million. That's money we can invest in the business and our employees," said Ulbrich.

The program targets more than 35 high volume procedures and tests, including: ACL repair by arthroscopy, cataract removal, colonoscopy, computerized tomography or CT scans, hysterectomy, knee arthroscopy, mammogram, MRIs, sinus surgery, and upper GI endoscopy.

Smart Shopper works a bit like the Priceline service for booking hotels and airlines. When a physician recommends a medical service or diagnostic test, the patient logs onto the Smart Shopper site and enters information about the prescribed services and the zip code where the service will be supplied.

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