Combat Medical Trend Health Insurance Rate Increases

Combat Medical Trend Health Insurance Rate Increases

Are you looking for ways to combat medical heath insurance rate increases?

Here it is again, the 4th quarter – open enrollment time for the majority of employers; a time for scrambling, a time for review, and a time to find new ways to help the client.

Here’s a new tool to help your clients who have received yet another rate increase for next year’s health plan.  Implement MedCareComplete as an employer-paid service placed alongside the health plan.

Recently, a broker shared this strategy with us at MedCareComplete.  He had a client who had 115 employees who were fully insured.  They were given a rate increase for 2017 that was 17.6%.  He didn’t feel the claims loss ratios for 2016 justified that level of price increase, so he developed a strategy to place MedCareComplete in the case as a 100% employer-paid service.  He needed a tool that could help bolster his underwriting argument to minimize a medical trend rate increase.

His stratagem centered on cost containment and changing the behavior of the group’s employees.  Knowing that the bulk of employer health care spending on an annual basis is driven by employee behavior, he approached the carrier with his plan for how MedCareComplete could drive a change in employee behavior.

By focusing on several of the nine components of MedCareComplete, he was able to educate the carrier on the benefits that MedCareComplete has to offer. He shared several scenarios using different components of the plan.

Telemedicine

Educating employees to turn to telemedicine for the majority of acute care needs redirects cost away from the health plan onto MedCareComplete with a zero consult fee.  Upwards of 90% percent of acute medical issues can be resolved through telemedicine services.

Medication management

With 15% of all healthcare patients having a chronic or polychronic illness accounting for 80% of overall healthcare costs, it makes sense to focus on a strategy to help this employee segment focus on their medication adherence.  The carrier knows that poor medication adherence leads to avoidable medical spending. To put this into context, for a typical mid-sized employer with $10 million in claims, poor adherence may generate avoidable healthcare spending of over a million dollars.*

Medical ID Theft Monitoring

A service designed to identify medical fraud against the patient’s medical insurance, and provides restoration services and reimbursement to the employee.  While the identity theft can’t be prevented 100%, early detection can help restore the person’s identity to its rightful place and identify healthcare fraud.

Medical Bill Negotiation

A service designed to identify medical coding errors, duplicate billing, and overcharges. An amazing 90% of all invoices reviewed have cost savings opportunities of 40% savings on average.

When the broker shared this information with the carrier, they adjusted the price increase from 17.6% to less than half the initial renewal rate increase.

The cost of embedding MedCareComplete for all of the employees was only 2.1% of the medical premium.

This became a win for the employer who saved money and has the opportunity to redirect employee behaviors for a more desired outcome. This was also a success for the employees who gain access to MedCareComplete services, and the carrier, who was able to reduce pricing and salvage the case for another year. Lastly, the broker wins because he helped the client solve another problem.

Even if you are unable to negotiate a better rate this year, changing the behavior of employees can help you set the stage for next year at renewal time by positively impacting loss ratios.

 

*“Thinking Outside the Pillbox: A System-wide Approach…” NEHI. 2009.

 

Authored by: Rick Dumas, Ph.D (MedCareComplete, LLC)

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