Is Group Purchasing The Solution To Your Healthcare Woes?
In simplest form the idea of group purchasing is for businesses to get together and pool their money to pay for healthcare themselves, bypassing insurance companies in the process. A radical change to be sure, but there is sound reasoning behind it.
Removing the middleman - health insurance companies in this case - sounds like a simple and elegant solution, but does it work? In truth, group purchasing does seem to offer many advantages including:
- Fewer entities impacting health plan spend which leads to more stability in pricing
- Less confusion for employees, who often don't understand their bills for treatment
- Lower costs overall since there is no insurance carrier to take a cut of profits
- No restrictive provider network to constrain employee choice
As with anything else there is no one-size-fits-all approach. Though group purchasing alliances can remove the undesirable influence of a profit driven insurance company; to experience these advantages it will be important that you engage the services of an knowledgeable consultant with expertise in health-risk containment, stop-loss captives, alternative-funding such as referenced based pricing, and overall risk mitigation. In such, by spreading out the risk while providing more stability and transparency in pricing, group purchasing could be very successful for some employers.
The Future Of Health Insurance
In many ways insurance carriers have failed to keep up with the changing world. The modern employee has access to a wealth of information online and a seemingly infinite number of choices. Today’s consumer expects access and choice in all aspects of life, including healthcare. A system where the insurance carrier limits you to certain providers and then does not allow you complete and transparent access to how the providers’ charges were developed and what the carriers discounts were based on is quite simply, outdated.
That's not to say there is no future for healthcare providers, they will continue to play an important role to patients seeking care and their families. It’s the pricing model and influence of the health insurance carrier to that model, that needs to be challenged. When a provider can give patients who are uninsured greater discounts than those who have insurance, the pricing model is clearly lacking.
As an employer you can't afford to sit around waiting for the problem to solve itself. That's why exploring alternative options such as group purchasing alliances and group self-funded health insurance is so vital. These solutions, along with several others, can enable you to take back control of your health plan spend.
As companies increasingly become aware of the flaws in the current system and look into alternative models the value of flexibility is more apparent than ever. It's still true that there is no one-size-fits-all solution to cutting your healthcare costs, so it's important to be open minded to all of the potential options for doing so. The challenge you may face is that though the possibilities for cost cutting seem endless, your time is not.
Though most business owners and CFO’s want to have the flexibility to drive results for their organization, they simply don't have the resources to figure it out in-house. That is where working with an advisor who is aware of the latest cost containment methods and how they fit into your business landscape will not only help you to immediately and dramatically lower your health plan expenses, but will also make your life that much easier.
At Summerlin-Roberts we leverage our expertise in cost containment to provide the best possible benefits at the lowest possible price. This results in more sustainable health plans and cleaner budgets for our clients. For more information on seeing what’s behind the curtain and reducing healthcare spend that affect your bottom line, please contact us today.