3 levers to cut healthcare costs
2. Reference pricing
Another way to encourage consumers to choose high-value, low-cost providers is reference pricing, according to Rosenthal. She cited the success of CalPERS and Anthem Blue Cross' reference pricing for hip and knee replacements.
Anthem set a reference price of $30,000 for the procedures; consumers who went to a hospital above the limit would pay the difference. The reference pricing saved $5.5 million over two years. And the prices for knee replacement dropped by 25 percent as patients shifted to lower-cost hospitals and hospitals renegotiated their rates to keep from losing patients, she explained.
The competitive payer environment, price variations and the challenge of convincing patients that low cost doesn't mean low value could prevent reference pricing from becoming widespread. So minor, elective procedures might work best for reference pricing, Rosenthal noted.
3. New delivery and payment models
Payers need to take new delivery models and layer on payment reforms to achieve significant savings. Those new delivery models include technology-supported healthcare delivery, team-based chronic care models, patient-centered medical homes and care management programs, to name a few.
In addition to incentivizing those proactive, systematic delivery models, payers must implement new risk sharing payment models--such as bundled payments, global payments and shared savings, Rosenthal noted. For example, accountable care organizations are the delivery system framework for global payments in Medicare.
"A mix of all of these levers is surely the right way to go," she told the audience.
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