Maximizing Savings and Care: The Benefits of Custom Networks for Self-Funded Employers

As the healthcare landscape continues to evolve, self-funded employers are seeking strategies to balance cost control with access to high-quality care for their employees. Custom provider networks have emerged as a solution, enabling employers to tailor healthcare access based on the unique needs of their workforce.  

Unlike traditional fully insured plans where employers pay fixed premiums, self-insured health plans offer the flexibility to manage healthcare costs directly. Self-funded employers have the power to choose the right providers for optimal care and savings. This is where custom networks come into play, allowing employers to build a network that prioritizes access, quality, and cost-efficiency to meet the needs of their workforce.  

The Role of Custom Networks for Self-Funded Employers 

Self-funding gives employers control over their health plans, including the ability to design a custom provider network. A custom network enables self-funded employers to contract directly with providers and health systems. This allows them to negotiate better rates, manage costs, and improve care access. The Alliance contracts directly with providers on behalf of its employer-members. This ensures access to high-quality care at competitive prices. 

Custom provider networks are designed to meet the specific healthcare needs of an organization’s employee population, which can vary by geographic location, medical needs, and employee preferences. These networks often emphasize preferred-value providers who deliver quality care at lower costs. By building strategic partnerships, employers can substantially lower healthcare costs while maintaining high-quality care for their employees. 

Advantages of Custom Networks for Self-Funded Employers

Tailored Network Design

Unlike standard provider networks, custom networks are designed with an organization’s specific goals in mind. Employers can choose to include local providers, specialists, and even centers of excellence for particular procedures like knee replacements. This tailored approach improves employee satisfaction. it also helps employers offer healthcare benefits that meet diverse needs of their workforce.  

Enhanced Cost Control

By selecting providers based on cost efficiency, employers can better manage their healthcare spend. Custom networks often involve Reference-Based Contracting (also known as Medicare-based pricing) or direct contracting with providers, ensuring predictable and often lower rates for services. This cost control empowers employers to reduce premium increases and manage their healthcare budgets more effectively.  

Reference-Based Contracting offers a benchmark for fair pricing, moving beyond discounts of total charges. By paying providers a percentage of Medicare rates, The Alliance establishes a standard for assessing value. This approach also empowers employers to design plans that encourage employees to choose high-quality, cost-effective providers. The Alliance has implemented Reference-Based Contracting in over 80% of its contracts. 

Increased Transparency and Data Utilization

Self-funded employers have access to claims data that provide insight into their employees’ healthcare usage and costs and lead to more informed decision-making. This transparency enables employers to identify cost-saving opportunities, improve care coordination, and guide employees toward preferred-value providers. 

Flexibility in Benefit Design

With custom networks, employers can structure their benefit plan to incentivize employees to choose preferred-value providers. This often involves steering through tiered benefit structures, where employees pay lower out-of-pocket costs when they use preferred-value providers. Such designs help align employee choices with the organization’s cost and quality goals.  

The Alliance’s Premier Networks are customizable and can include up to four tiers. By including major health systems along with alternative care options like independent providers for primary care, behavioral health, imaging, and laboratory services, we ensure that individuals can access care where they’re most comfortable, receiving timely, high-quality services at a fair cost. 

The Alliance partners with employers to create custom networks that emphasize cost savings and high-value care. We contract with over 39,000 healthcare professionals throughout the Midwest, including 9,700 clinics, 150 hospitals, and 395 home health providers. Our Comprehensive Network covers 91 percent of Wisconsin and gives employers a broad selection to offer their employees and covered family members. 

We are continuously expanding our networks in key areas for our employer-members. For example, Western Wisconsin was affected by hospital closures this year. The Alliance added multiple preferred-value providers in this region to ensure self-funded employers and their employees in Western Wisconsin have convenient, cost-effective healthcare options.  

Data-Driven Decision Making 

The Alliance leverages robust data analytics to uncover hidden savings opportunities. We provide this analysis to our employer-members in a customized report called our Smarter Health^SM analysis. These insights help employers guide employees toward providers who offer the best value, further maximizing the impact of their custom network. By analyzing claims data, utilization patterns, and provider performance, employers gain a clearer understanding of how to optimize their benefit strategy. 

Comprehensive Support 

From network design to ongoing support, The Alliance’s resources help employers stay current on healthcare trends and challenges. Educational events by The Alliance promote knowledge sharing among employers and resources like our Find a Doctor tool empower employees to make informed decisions based on cost and quality comparisons.   

Looking Ahead: Maximizing Value with Custom Networks 

As healthcare costs continue to rise, the ability to control costs without sacrificing quality is crucial. Custom networks offer a strategic advantage for self-funded employers in today’s complex healthcare environment. Self-funded employers who embrace custom networks can unlock new levels of savings and care. This ensures a healthier future for their organizations and their employees. 

Reach out to our Business Development team to learn how The Alliance can help your organization self-fund smart with customized provider networks.