Wisconsin Can Save $394 Million by Steering Patients to High-Value Health Care

In a new study released by GNS Healthcare, data shows that employers could save hundreds of millions of dollars by steering consumers toward high-quality, low-cost physicians.

Using 2017 Wisconsin Health Information Organization (WHIO) claims data, they analyzed 3,760 primary care physicians who performed at least 100 evidence-based measurements, totaling $1.4 billion in costs. The result? If the bottom 50% of providers increased their performance, it could save up to $394 million.

Health care costs have increased every year since 1960, and the only strategy fully-insured employers had to stave off cost increases was to shift the financial burden to employees – who have grown dissatisfied with their ever-increasing high-deductible health plans. This trend has caused an overall lower rate of health care utilization, and when combined with a competitive hiring market, it’s causing employers to look for a new health care solution.

Moving Forward

There is no correlation that higher cost equals better care, and nearly 1,000 doctors in the study ranked better than average on cost and quality.

The answer then is to educate patients and encourage them to use high-value providers. The only way to lower health care costs substantially is to provide shareable data that employers can use to educate plan beneficiaries. By banding together and volunteering claims data to future studies, employers could push the public policy pendulum towards better cost transparency, forcing that change.

It’s why The Alliance is participating in the new Rand 3.0 study, set to be released in May, which takes an in-depth look at the prices paid by private health care plans in comparison to Medicare. The study will supply the market with much-needed cost transparency, and hopefully drive employers to demand necessary, immediate change

As Dana Richardson, the CEO of WHIO, puts it, “When I think about cost, I say to myself, this journey that we have been on for quality has been 30 years and we don’t have 30 more years to address cost. I contend that we need to think about our work to slow the rise of healthcare cost as an expedition instead of a journey. And we need to do that because it needs to be a serious movement from one point to another.”

What Employers Can Do

Employers can work with an employer-owned cooperative like The Alliance and encourage patients to utilize high-performance providers.

If employers educated their employees and encouraged them to seek low-cost, high-value health care, both groups could save a substantial amount of money. Employers can also participate in future studies by releasing their health care data to increase transparency in the market.

Additionally, they can join other employers in self-funding to increase their collective bargaining power.

For more information on how the Alliance can use data to help you steer employees to the right care, contact Member Services.