WHAT IS REFERENCE BASED PRICING?


A bold approach to benefits

LET’S GET STARTED

WHAT IS REFERENCE BASED PRICING?


A bold approach to benefits

LET’S GET STARTED

Healthcare Pricing Trends


TYPICAL RENEWAL INFLATION


Trend based on $400,000 annual cost over 4 years

Reference-based pricing has long been used in other countries as a means to controlling health care expenditures by creating transparency in pricing. Recent research in the United States has demonstrated that reference pricing can be equally effective at reducing costs for procedures as consumers redirect their business to lower-cost providers, causing providers to lower their prices further to remain competitive.

Under reference-based pricing, a payer offers to pay a fixed price for an item or service. The plan member can then go to any vendor or provider that will provide the item or service for that price. Members may also go to a more expensive vendor or provider, but will have to pay the difference between the plan’s offered price and the price charged by the vendor or provider.

Savings from reference pricing materializes through the combination of 1) patients choosing providers at the reference price, 2) patients paying the difference between the reference price and the allowed charge through cost sharing, and 3) more providers reducing their prices to the reference price.

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REFERENCE-BASED PRICING CASE STUDY


INNOVATION & PARTNERSHIP DRIVE DRAMATIC RESULTS


$510,460 Annual Savings


SCENARIO


A national service provider with over 250 employees was facing significant fixed cost increases for claims administration in addition to increases in stop loss insurance. We had taken the client self-funded several years ago and while this allowed them to optimize all of the components that make a health plan function, we had reached the pinnacle of maximizing the advantages of self-funding.


SOLUTION


Beneflex implemented a Referenced Based Pricing solution to reduce hospital spend. This allowed the client to keep their plan design but eliminated the need for a PPO network for hospital stays. Employees are able to choose any hospital or doctor without the limitation of a PPO network. By going outside of a “traditional” solution we were able to design a program that resulted in significant savings while improving their health plan benefits.


RESULTS


REFERENCE-BASED PRICING CASE STUDY


INNOVATION & PARTNERSHIP DRIVE DRAMATIC RESULTS


$510,460 Annual Savings


SCENARIO


A national service provider with over 250 employees was facing significant fixed cost increases for claims administration in addition to increases in stop loss insurance. We had taken the client self-funded several years ago and while this allowed them to optimize all of the components that make a health plan function, we had reached the pinnacle of maximizing the advantages of self-funding.


SOLUTION


Beneflex implemented a Referenced Based Pricing solution to reduce hospital spend. This allowed the client to keep their plan design but eliminated the need for a PPO network for hospital stays. Employees are able to choose any hospital or doctor without the limitation of a PPO network. By going outside of a “traditional” solution we were able to design a program that resulted in significant savings while improving their health plan benefits.


RESULTS


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