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Fixing Misconceptions on U.S. Healthcare

Today’s healthcare system is an absolute mess. It’s outrageously expensive, needlessly complicated and driven by transactions instead of relationships. People are paying more and more each year – always for less insurance coverage and very little “real” healthcare. Of course, the system is broken…. Or is it?

To begin to transform healthcare, it’s important to identify and correct our misconceptions about the system. Let’s start with two big ones:

Misconception #1: Americans spend nearly $3 trillion a year on healthcare (and this number is rising).

Three trillion dollars is about 18% of our nation’s gross domestic product. We rank terribly against other developed countries for overall healthcare system costs.

But there is a major problem with this statistic. It doesn’t represent what’s really happening.

Look at Canada, which ranks much better than the U.S., spending less than 12% of its GDP on healthcare — but we are calling foul on this stat. I lived in Canada for 23 years. I received my education there, trained there, practiced there, owned a company there and was a patient of the Canadian healthcare system on several occasions. I also have many friends and family members who still live there. The truth is that many Canadians come to the U.S. for routine and not-so-routine healthcare because it is not easy to access in Canada. In fact, if you’re in Canada and need healthcare urgently, you may find yourself in a terrible bind.

The truth is that the Canadian healthcare system simply doesn’t match up to the U.S. system for quality, accessibility and true effectiveness. It’s not even close. The most privileged people in Canada wait (and sometimes die waiting) for services that the poorest and most average Americans can access right away, very successfully, every hour of every day. I’ve seen it over and over again with my own family and with many strangers looking for help. Americans wouldn’t tolerate for one day what even the most privileged Canadians endure indefinitely before finally coming to the U.S. for care.

So how can Canada’s better healthcare GDP ranking be explained?

Let’s start by breaking down U.S. “healthcare” spending:

Do we really spend $3 trillion a year? Or is a large portion of this money wasted on excessive administration and poor planning but billed as “healthcare” spending? Are there healthcare companies that depend on revenue and profits generated by this waste and administration? Yes, there are.

Here’s my take. Many status quo healthcare players are certain to disagree, but, as Upton Sinclair said, “It is impossible to prove something to someone whose salary depends on believing the opposite.”

I believe that true healthcare costs in the U.S. are only about $1 trillion (6% to 8% of GDP) and that many industries are turning a nice profit by structuring their systems to capitalize on predictable waste, administration, inefficiencies and poor planning – built right into the U.S. healthcare design.

See also: Why Healthcare Must Be Transparent  

I’m not saying that there isn’t any waste or unnecessary administration that spur extra spending in Canada – there’s lots of it. I’m just saying that the financial incentives are much different. Waste and administration don’t pay as profitably in Canada as they do in the U.S. I’m also not saying that the Canadian healthcare system is better than in the U.S. I believe healthcare is far superior here. I’m just saying that in the U.S., we allow big industries to earn humongous profits off of waste, administration, inefficiency and poor planning. Canada does not.

“Waste” is a bit abstract, so let’s provide a couple of examples. In Canada, an MRI completed at a cost of $300 to $500 in an independent lab is not performed again a week later in a hospital at a much higher cost, as can happen in the U.S. And a gall bladder surgery that can be performed at one site for $3,200 will not be performed at another hospital for $14,000. This happens in the U.S. many times every day, contributing greatly to our $3 trillion in costs. This difference in cost is “waste,” not “real healthcare.”

“Poor planning” is also a bit abstract. But imagine the diabetic child of one of your employees running out of her 90-cent glucose monitoring strips that are essential for determining the correct dose of insulin she needs. It would not be uncommon for this situation to lead to a $20,000-plus hospital admission. So, you tell me, was the hospital’s $20,000-plus in revenue a result of a need for “healthcare,” or was it really because of “poor planning” built right into a system that limits diabetic supplies? Maybe we’d be going overboard if we claimed that this design was deliberate, but the fact remains that limiting basic, inexpensive primary care, education and diabetic supplies benefits the status quo players in healthcare. This amount also contributes to America’s $3 trillion in healthcare spending.

Moreover, Canadian private insurance companies simply cannot demand double-digit premium increases from employers every year to pay for this waste, administration and poor planning, but it is tolerated by most businesses in the U.S.

Misconception #2: The healthcare system is broken.

Like most people, I used to agree with the commonly stated premise that the healthcare system is broken. I now have concluded that the American private healthcare system is working exactly as intended. Let me explain.

America’s healthcare system is run and controlled by trillion-dollar industries with multi-hundred-billion-dollar companies that are publicly traded and exert a lot of influence on the actions of our governments. With all of the talk about the expenses resulting from the Affordable Care Act, it’s shocking to learn that the most profitable stocks from 2011-2016 were U.S. insurance, pharmaceutical, hospital and other related healthcare companies. In fact, the percent growth in American health insurance stocks during that period are four to five times greater than the Dow, and the Dow is up more than 100%!

These public companies have a goal (and fiduciary duty) to grow revenue and profits (and share prices) by any legal means. Because these companies can easily leverage their size and influence to exert control, I believe it is reasonable to conclude that today’s U.S. healthcare system is working perfectly for what it was designed to do – return shareholder value to these companies. It’s just not working that well for the rest of us. Maybe it’s just not designed for us.

Are there any business owners or employees who still feel that the healthcare system exists primarily to serve them? If the system did exist for you, wouldn’t you expect to see much more transparency in pricing? Would you accept insurance premiums that go up 10% to 40% percent every year? Wouldn’t your employees be able to make appointments much more easily and have more access to their doctors via the phone? Wouldn’t their doctors’ appointments begin on time, minimizing time wasted in a waiting room?

In a nutshell, healthcare would be much easier, more convenient, more affordable and more accessible, and you wouldn’t have the hassle, frustration and feeling that you were being taken advantage of at every renewal time. Clearly, the system is not designed to serve the employer and employee. But this doesn’t mean it isn’t doing what those in power want it to do. Share prices don’t lie.

The more we have studied it, the more we see that the only two stakeholders in the entire healthcare system who are aligned for costs, quality and customer experience are the purchaser of healthcare (the employer) and the user (the employee). All other stakeholders (e.g., hospitals, doctors, insurance companies, brokers, pharmaceutical companies, and even our politicians) have incentives to do things and make decisions that are not aligned with the employer and employee. At the very least, there are many things that happen in the healthcare system that do not benefit the employer and employee but do benefit other stakeholders in the system.

But there is a secret:

When an employer and employees team up and recognize their aligned interests, they gain a tremendous new capability for lowering healthcare costs, getting better quality and results and receiving the customer experience they want.

Even though it could seem that the more organized stakeholders of healthcare (e.g., the hospitals, insurance companies, brokers, doctors, etc.) are conspiring to take advantage of employers and their employees, we would encourage you instead to consider that, in most cases, the people running the system are very good people who want the best and want to help people. This is why they pursued a career in healthcare in the first place. It is just unfortunate that the system in which they work has evolved and now essentially forces them to add the costs of profitable waste and unnecessary administration, and often they don’t even know they are doing it.

See also: Not Your Mama’s Recipe for Healthcare  

It doesn’t have to be this way — and there are ways that employers can take back control. It always starts with challenging the status quo thinking, and by taking a common sense approach to simplifying and gaining price transparency. Designing an employer health plan that makes routine primary care, labs, chiropractic and preventive exams super easy, convenient and affordable is always the foundation for minimizing the high-dollar expenses that eat up most of the healthcare claims budget.

Read “Business Owner’s Guide to FIGHTING HEALTHCARE” for more details on how anyone can make healthcare work for them.

If It Walks Like a Duck, Talks Like a Duck…

Everyone is talking about the dangers of “opioid addiction.” It’s been a topic of conversation among pain management specialists, chiropractors and other healthcare providers for years, but constant news coverage of “opioids” has made it water-cooler talk. Thanks to the media, we’re all experts on the issue.

But here’s the thing: the media – and the public – are missing the point entirely. Even the expression “opioid addiction” is completely off the mark. Because we’re not talking about “opioids” – we’re talking about addiction to heroin derivatives.

“Opioid” is a much safer word than heroin – not nearly as hair-raising or dangerous. But using the word “opioid” is like putting icing on a mud pie – it’s a cover-up at best. And when you make the connection that opioids are actually heroin derivatives, you understand why the addiction has become an epidemic in this country.

The problem, though, is much more sinister than we realize. For one, patients now expect their doctors to prescribe morphine or oxycodone for pain management. Second, there’s money to be made in “opioid addiction.”

See also: Opioids Are the Opiates of the Masses  

As reported in Risk & Insurance, a new study finds that a majority of patients still believe opioids are the most effective remedy for pain. In fact, a full two-thirds of physicians surveyed said their patients expect them to prescribe drugs. And in spite of the highly addictive nature of these drugs, doctors are still influenced by their patients’ expectations.

It gets worse. Despite evidence that oxycodone and morphine are not the most effective medications for pain relief, almost all of the physicians who were surveyed – 98 percent of them – prescribe some form of opioids for pain control. What’s more, the National Safety Council reports that 99 percent of the providers prescribe opioids for longer than the three-day course of treatment the Centers for Disease Control recommends.

Here’s the icing on this mud pie: nearly 90 percent of physicians say they find it difficult to refer patients to treatment for drug abuse or addiction, even when it’s clear their patients need help. It’s a vicious cycle with no easy solution.

Like almost everything in healthcare, we’re overlooking the most important part of the story.

The same doctor who prescribes opioids that lead to addiction can make his best money on the mandatory drug/toxicology testing he performs every month. Many good doctors recognize this as a conflict of interest – they also see that their patients are requiring higher and higher doses to feed their additions – and they intervene in the best interests of their patients. Unfortunately, there are plenty of other physicians who aren’t concerned about scruples. They are perfectly willing to pick up where others leave off. It has become a lucrative, albeit perverse, business model today.

I wish that were the end of it, but we’ve only scratched the surface. The story gets much worse from here. When patients no longer can afford opioids and drug testing (which can cost them $4,000-$10,000 each year), many have resorted to selling a couple of pills on the street in order to cover their costs. In essence, decent, respectable people become law-breaking drug dealers. Some people don’t want to sell their prescription drugs, but still must feed their addiction. Broke and desperate, they buy a cheap, street version of their opioid. This is called heroin.

It’s a trap, and it’s snaring people who never realized they were abusing heroin derivatives. They believed they were treating their pain with safe, physician-recommended oxycodone or morphine. They believe it was their best option for managing their symptoms.

Heroin derivatives are ruining the lives of good, hardworking people across the country. In recent months, I saw the horror firsthand when heroin overdoses stole the lives of two young men in my community – men with their whole lives in front of them. They weren’t your stereotypical druggies – they were addicted to pain meds.

See also: How to Help Reverse the Opioid Epidemic  

I believe addiction to heroin derivatives is far worse than anyone realizes. Someone must throw a wrench in a problem that’s wreaking havoc on families and entire communities. Here’s how Redirect Health is addressing the issue:

1. Strike “opioids” from the discourse: Never call these highly addictive prescriptions “opioids” or “pain killers.” Instead, call them “heroin derivatives,” because if it walks like a duck and it talks like a duck…

Far fewer people will want to start taking these drugs if they understand they’re a form of heroin. Simply changing the semantics will also give providers pause; they won’t be so quick to prescribe heroin derivatives.

2. Provide alternative forms of pain relief: We make it easy and affordable ($0 copays) for people to access other, safer and more effective pain management services. Our chiropractors and primary care physicians work together to help members with practical and customized virtual rehabilitation programs that don’t cost a penny out-of-pocket, don’t require them to miss work, and will provide a long-term, tenable solution to managing their pain.

It’s common sense, but not commonly done.

Key Misconceptions on Health Insurance

As the Obamacare compliance clock ticked down, a Phoenix-area CEO lay wide awake at 2 a.m., worrying he might have to consider laying off more than 70% of his 170-employee workforce. Earlier that day, his insurance broker told him that companies with more than 50 full-time employees would be fined heavily if they didn’t provide health insurance under Obamacare. His lawyer confirmed it — the fine would be as high as $5,000 per employee.

None of his options looked good. The cost of the health insurance his broker proposed exceeded his company’s profits; ignoring the law’s reporting requirements would increase his fines even more. Reducing his staff to avoid the Obamacare mandate meant splitting up his company or laying off 120 employees.

Except for one thing: His broker and lawyer were wrong about the law. Obamacare does not require employers to offer health insurance.

Since Obamacare became law, blue collar, service, construction and other such companies nationwide have grappled with providing employer-sponsored healthcare that wouldn’t completely bankrupt their business — a seemingly impossible challenge given the skyrocketing cost of medical insurance. Here in Arizona, CEOs are confronting the issue head-on.

Like these CEOs, you have to start by arming yourself with the truth. Then, you realize that, if structured correctly, healthcare can become a huge competitive advantage for companies of all shapes and sizes.

Say what? Healthcare is usually one of the biggest expenses for a company. Most people would consider it a major impediment to profitability — not a competitive advantage. But that’s where they’re wrong.

In a previous article, I discussed how the correct place of service makes the biggest impact on healthcare costs. Simply understanding the huge difference in costs for services performed in a hospital vs. identical services received in a lab or imaging facility down the street can help companies and their employees make smart choices about getting high-quality, high-value care.

But it doesn’t stop there. Beyond managing place of service, employers can take action right now to transform healthcare into a competitive edge. This might seem unbelievable — status quo healthcare is a colossal expense that’s bleeding companies dry — but small- and medium-sized businesses really can avoid overpaying, lower employees’ costs, decrease the amount of time spent away from work and provide benefits that larger competitors simply cannot match.

See also: Is Transparency the Answer in Healthcare?

The experts will tell you this is impossible, but these three steps are all it takes:

1. Think differently.

First, businesses must decide that they are finished with the status-quo healthcare system. What would it be like for them to approach healthcare with a completely different mindset? To reconsider what they’re willing to tolerate and pay for — and what they’re not? Instead of being resigned about the burden of healthcare — helpless in controlling costs while also meeting the mandates of Obamacare — what would happen if they were to apply an entrepreneurial mindset and skill set to their healthcare problem?

Despite shocking health insurance rates and a general belief that costs cannot be controlled, thinking differently about healthcare translates to an entirely different experience. With the help of a trusted broker — they’ll never think about their company’s healthcare the same way.

2. Understand the law and what’s required.

Most business owners do not truly understand what the law requires or what the difference is between what’s required and what they may want to provide their employees for strategic reasons. In many cases, insurers are using Obamacare to convince companies they must provide traditional health insurance or risk massive government fines. Brokers can help their clients understand what the law requires and build a plan that meets Obamacare mandates and offers great healthcare without killing the bottom line. For example, self-insurance is a great solution for many companies.

3. Design and build a health plan that meets a company’s unique needs.

Most employer-sponsored health plans are structured to benefit their insurer, but brokers can help their clients change all that. The best plan will allow the company and its employees to pocket the savings if waste, administration and overpricing are eliminated.

See also: Healthcare Quality: How to Define It  

Here are a few key components of a health plan that work well:

  • $0 Co-pays for routine care (the “routine 90%”): 

It might seem counterintuitive, but charging co-pays for routine care will actually cost companies a lot more money in the long run, not to mention reduce employee satisfaction. The simple solution? Businesses should steer clear of routine co-pays. Instead, they can provide the “routine 90%,” meaning 90% of the care that 90% of people need and use, 90% of the time, all at no cost to their employees. This includes things like preventive services, primary care, physical medicine and injury care, rehabilitation (including chiropractic), basic labs, X-rays and immunizations.

The “routine 90%” represents a very small portion of overall claims, perhaps as low as only 10% of the costs. Purchasing traditional insurance to cover this 90% is unwise for businesses aiming to control costs and make their workforces happy; self-insurance will usually make the most sense.

When these services are free and easily accessible, expensive hospital and urgent care visits will go down a meaningful amount. But be wary: This “no co-pay” tactic can also backfire; it can be used as a loss-leader tactic to guide your staff toward high-priced hospital services when a hospital system employs the primary care doctors. This is exactly why it’s important for business owners to educate their people about the huge price differentials between hospital doctors and services and identical services performed at an off-hospital lab or office.

  • Stop-loss insurance for non-routine services (the “other 10%”):

Stop-loss insurance covers the more expensive and less predictable 10% of costs for things like accidents, chronic or complex illness and catastrophic diagnoses like cancer. Such insurance will cover hospitalization, specialist care, brand-name prescriptions and other high-cost services and procedures.

  • Plan design that guides and rewards

Most people don’t know how to get the most value out of the healthcare system, but brokers can help business owners educate their employees and provide smart incentives. Giving employees $0 co-pays for the inexpensive “routine 90%” is a great way to start, but there are plenty of other incentives that will save business owners money while also improving employees’ healthcare.

As an example, a smart health plan design will always discourage the quick use of elective orthopedic surgeries and procedures until inexpensive $0 co-pays in the “routine 90%” prove ineffective. A smart plan will always reward the use of generic prescriptions over expensive brand names that provide no extra benefit.

In future articles, we’ll dive into some easy (and very smart) incentives that any employer can include in their plan designs to ensure they can lower the bigger, unnecessary claims costs.

  • Data analytics

A well-designed health plan includes a mechanism for continuous data collection and learning about the people who incur the most claims costs in any particular year, month or day.

In a previous article, I discussed why business owners should own their company’s health data because it enables the employer and broker to negotiate fair pricing, educate their people about place of service and ensure they’re making smart decisions about care. The same is true for stop-loss insurance; companies should demand ownership of employees’ data.

Collecting and leveraging this data will provide the advantage businesses and their brokers need to keep renewal costs from rising every year.

  • Free protection and support

It’s important that HR managers and employees know where to start when they have questions or need care. Doctors and other health industry professionals may direct their patients to hospitals and other needlessly expensive places of service. And if the providers are affiliated with a hospital system, they may be obligated to refer patients to a hospital, even if the services they need are available at an offsite clinic at a much lower cost.

Business owners have the power to disrupt this status quo process. By providing their people with free, 24-7 assistance in navigating the healthcare landscape, they can improve employee care and satisfaction and can protect their business from overpaying.

Knowing the costs of services, where to find value and how to avoid waste before a service is needed is a critical part of the protection and support employees need and appreciate.

In a future article I’ll share some very valuable healthcare “hacks” that business owners and employees will find empowering. In the meantime, I encourage you to visit redirecthealth.com/HealthPlanScorecard to complete the free Health Plan Scorecard. In 10 minutes or less, you’ll be able to score your healthcare mindset and make immediate improvements.

Why Healthcare Costs Bleed Firms Dry

“It is impossible to prove something to someone whose salary depends on believing the opposite.” – Upton Sinclair

Today’s overpriced healthcare system is hurting American businesses and job creation, eating into profitability and, quite frankly, bleeding companies dry. What’s worse, the lack of cost control and price transparency have created a culture of helplessness and even resignation.

But employers have had enough. Many are rising up and demanding change. They want lower costs and better care for their people and will no longer tolerate the status quo.

In 2007, I made it my mission to put an end to overpriced healthcare when my own companies’ healthcare costs were cutting dangerously into the bottom lines. At the time, I operated numerous healthcare clinics throughout the Phoenix metro area. We found our best hourly employees were leaving us for jobs at larger corporations with better health insurance, and we couldn’t attract replacements with the same level of training. Productivity and efficiency plummeted. It was an absolute mess, and I felt like a failed CEO.

But we discovered a secret that no one else seemed to know – or at least nobody seemed to be saying aloud. It’s a secret we uncovered when we started doing something I had never heard of anyone doing: writing our own checks for our employees’ healthcare.

See Also: When a Penalty Is Not a Penalty

It seemed strange that the cost of giving birth at one hospital was $6,000, while the cost at a neighboring hospital was $17,000 – even though the same doctor had attended both births! Strange that an ankle X-ray could cost $1,200 in a hospital emergency room but only $35 at my own clinics. Stranger still that a simple antibiotic could cost $900 at one pharmacy when Walmart sold the exact same drug for only $12.

Those observations helped lead to the secret to not overpaying for healthcare.

Controlling PLACE OF SERVICE is all that really matters

In the vast majority of cases, my employees could receive the right level of care in a setting that provided the same service (with the same or even better quality) at a much lower cost than in another setting.

Of course, sometimes a hospital emergency room visit is absolutely necessary. On occasion, an urgent care is the right option. But qwe saw that many medical expenses were needlessly incurred in hospitals and other expensive settings. MRIs, X-rays, blood tests, specialists consultations and other common procedures were costing my companies five to 20 times more than the exact same services performed across the street in an imaging center, lab or doctor’s office not owned by the hospital.

Why would someone choose to get a $3,600 MRI or $1,200 X-ray at a hospital instead of going to an imaging center across the street for an equally good, $400 MRI or $35 X-ray? Why would anyone get a procedure at one hospital instead of paying 40% less for an identical procedure at another hospital around the corner? It’s not that people don’t care. THEY DO! The answer is that they simply don’t know – and the system is designed so that it is very hard for people to uncover this truth.

It seems crazy, but this sort of thing happens systematically all the time. When employer health plans work well – when prices are transparent and employees are protected and guided away from overpriced services – then common sense prevails and costs stay in check. But if people are part of a health plan that benefits from keeping costs hidden – and most do – business owners and their people simply don’t know they’re being duped.

Why is this is happening? 

  1. Hospitals with the greatest market share negotiate much higher reimbursement rates from insurance companies. A December 2015 study by researchers from Yale, University of Pennsylvania and Carnegie Mellon University analyzed billions of hospital clams paid by commercial insurance companies to hospitals. The study concluded that costs at hospital systems with significant market share were as much as 12 times higher than other, smaller hospitals – with no difference in quality. It was an important and revealing study, yet it failed to evaluate the even bigger differences in price for routine procedures performed at a hospital vs. outside a hospital – procedures that never needed to be done in a hospital in the first place. These price differentials and subsequent overpayments are even more shocking and have the biggest impact on overall healthcare cost.
  2. Hospitals are “buying” doctors so they can fill beds and price excessively. Even though hospitals lose approximately $165,000 each year for every primary care doctor and about $300,000 for each specialist they hire, this strategy has proven effective; it increases market share and allows hospital systems to negotiate higher prices with insurers. What’s more, these doctors are obligated to refer their patients for services or specialty care in an exorbitantly overpriced hospital setting. Of course, emergency procedures are occasionally necessary, and of course hospital infrastructure costs are always higher and will need to be taken into account when assessing fair pricing. But when millions of dollars are used to market elective services that are arbitrarily priced much higher than what is fair – well, this just shouldn’t feel right to the unknowing business owner and employee. After all, they trust the healthcare system to guide and care for them.
  3. Urgent care centers are now owned by hospitals. It’s no surprise, then, that urgent cares are owned by hospitals, providing a perfect entry point for funneling services and profitable patients to hospitals and the doctors who are employed by those hospitals. Following this same line of thinking, urgent cares also help hospital systems gain market share, negotiate higher rates and “mine” the sickest people from among those patients.
  4. There are huge price differentials in prescription drugs. This problem is rampant in the healthcare industry, even extending to runaway prices in common prescriptions. The costs of medications vary dramatically depending on the pharmacy, the insurer and the way the doctor writes the prescription. The cost of a simple generic antibiotic can range from $12 at a grocery store to more than $50 at a widely known national pharmacy – and to more than $900 for the brand name that legally gets substituted when the pharmacy chooses. You might think the answer is obvious – just stop overpaying – but many people simply aren’t aware of the pricing tricks.
  5. High-deductible health plans partner with hospital systems. Often, such plans require that services be performed exclusively at a particular hospital’s health centers or affiliated urgent cares, imaging centers, doctor’s offices, etc. In other words, the hospital system that has negotiated higher rates with insurers now requires health plan participants to use their overpriced services. They say they have negotiated lower prices, but we see that costs are much lower when a patient pays cash outside the hospital.

In the case of high-deductible plans, it’s employees who get stuck with much of the bill. The premiums are cheaper upfront, but employees and their families are charged for services until their deductibles are met, often paying inflated prices for procedures performed in a hospital or affiliated setting. When they can’t afford to pay the deductible, employees often direct their frustration at their employers for providing this sort of coverage. And, sadly, many low-wage people will decide to forgo needed care.

See Also: Why Healthcare Costs Soar (Part 6)

What if brokers could help their small business clients by providing the negotiated fee schedule with the hospital system employees will be required to use? Or at least educate them about the dangers of using hospital facilities for services that could be performed outside a hospital? This is especially important for people with high deductibles.

Though it’s not common to request the price list – and insurance companies won’t grant the request – it’s certainly common sense. Shouldn’t employees understand the costs before choosing a doctor or facility? Simply providing the fee schedule would at least give them and their doctors a fighting chance to make care decisions based on both quality and value.

Increased transparency in an industry of hidden costs and unexpected medical bills would be a powerful step toward saying “NO” to the overcharging that the biggest healthcare facilities get away with every day.

The Importance of Data

Educating and guiding employees to the best places for service will have a huge impact on moving the cost needle. And, using data to identify the sickest employees and understand where they are getting their healthcare services is a great multiplier that brokers can use to help their business clients achieve more cost savings.

If an insurance company will not agree, in writing, that all of the company’s data belongs to the business owner – regardless of whether they’re certain to renew – the business owner should walk away.

Most traditional insurance companies will tell business owners they can’t give them this data because of privacy laws or HIPAA. The real reason is that they don’t want their clients to share the data with competing insurers and potentially lower their healthcare costs. In reality, business owners can own their data. Nothing in the law says otherwise. (Employers should never directly look at employees’ personal health information. This is just common sense.)

We encourage business owners to push harder and challenge the status quo way of thinking. We want them to demand cost transparency so they can control their own costs and still take great care of their people. Owning their employees’ data will enable the employer and their broker to negotiate fair pricing and educate their people about place of service more effectively. Brokers who rise to this challenge will find great opportunities to grow their business and create undying loyalty among their clients.

Status quo healthcare costs are bloated with unnecessary administration, waste and overpricing, but businesses and brokers who understand how to choose the right place of service can save money and easily fund healthcare. The worst thing we can do is pay more.