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Employers Score Savings When Patients Shop By Price

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

A list of facilities—as many as 10—is displayed, but the provider names are withheld. Charges are represented by dollar signs with one dollar sign the lowest cost and five individual dollar signs representing the highest cost. The price differential between the lowest and highest costs is about 200%. All facilities are part of the Anthem network.

Employers set the incentives, which typically are $100 to $250 depending on the procedure, and are responsible for making the incentive payments to the employees. Anthem is testing payments up to $1,000 for price comparing on some more expensive procedures such as MRIs.

An Anthem spokesperson offered this example based on colonoscopy costs at locations less than four miles apart from one another in Hartford: Provider A charges $3,280, provider B charges $2,821 and provider C charges $1,718. The patient receives a $100 incentive for selecting provider C and the employer saves between $1,103 and $1,562 on the cost of the procedure.

Savings are captured and reported to the employer each month. Self-funded employers save money by paying less for medical services.

Ulbrich sees more potential savings by improving the health of his employees. "Over the long-term, wellness is the way to hold down the cost of our health benefits. Our employees are getting the medical care they need and through this program they'll have a better idea of how much healthcare really costs and how much can be saved by shopping around," he explained.

Ulbrich admitted that he has heard some physicians complain that the Smart Shopper program is more about saving money than improving the quality of care. "I see this as beginning to help our people understand why their premiums increase and what they can do to help us hold down costs. All of the facilities are in the Anthem network so they're already available to our employees."

 


Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
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