Rising for decades, US healthcare costs have been taxing businesses and employees. One creative approach to budget management is reference based pricing (RBP). This approach establishes, depending on the usual cost of a medical treatment in a certain area, a predefined reimbursement rate. RBP might enable companies to motivate employees to pick less expensive, high-quality therapy instead of the most expensive option. This page goes over actual RBP success stories.
Paradigm change in healthcare reimbursement
Montana has early and effective reference based pricing initiatives. In 2010 the Montana PEBP approved RBP for hip and knee replacement surgeries. As the average cost of these surgeries dropped 25% over a few years, the state saved millions of dollars. Different states like Colorado, Montana, have embraced RBP for different medical procedures and seen similar cost savings.
Raise Standards of Quality in Care
Although savings are important, RBP offers additional advantages. RBP sometimes enhances patient treatment. RBP may help providers that routinely deliver reasonably priced, high-quality care obtain more business by motivating people to find them. This might reduce healthcare expenses and help to improve patient outcomes.
RBP for certain medical services was first established by Asheville, North Carolina in 2012. The city has saved money and raised employee satisfaction since then. According to a municipal study, the data shows that our employees are receiving high-quality care at lower costs, and that our providers are responding to the challenge of delivering value.
Let patients make wise decisions
RBP guides individuals towards better decisions about their treatment. By providing open, clear information about provider cost and quality, RBP may help individuals decide where to get care. For high-value suppliers, this may boost business and force them to maintain cost and quality standards.
For certain medical services, Fort Worth, Texas, for example, introduced RBP in 2015. Regarding a municipal study, the RBP program has been successful in offering our employees more transparency in healthcare costs and quality, allowing them to make informed decisions about their care. The program has saved the city money, and employees enjoy RBP’s candor and decision-making.
Rising Over Challenges
RBP has flaws and misconceptions notwithstanding its benefits. Some think RBP might limit access to treatment as providers could be less likely to accept set pay rates. Research suggests RBP may increase access to care by driving more business to high-value providers.
RBP has to inform businesses and employees on both advantages and drawbacks. Every RBP program’s success rests on this time-consuming and complex process.
San Antonio, Texas has a strong RBP program. In 2016 the city launched a comprehensive education campaign to guide staff members and instituted RBP for certain medical procedures. The education campaign was critical to the success of the RBP program, as it helped employees to understand how the program works and how it can benefit them, said a municipal evaluation.