26 Jun Employers Push for Better Health Pricing

Originally published by Dan Cook on the BenefitsPro website.

Catalyst for Payment Reform told lawmakers this week that efforts to elicit better value for employer-sponsored health plans take a flawed approach to solving the pay-for-value problem.

The crux of the issue: health plans are being evaluated by the simplest measures rather than ones that dig deeper. For most purchasers of the plans, this only frustrates efforts to control costs and facilitate better outcomes for those covered.

“One of today’s biggest shortcomings is the separation of price and quality information,” Dr. Suzanne Delbanco, executive director of the group, said in an appearance before the U.S. Senate Committee on Finance.

“I think we have probably too many [quality metrics] now and not enough that focus on exactly those points where there’s the greatest opportunity for reducing harm and where there’s the greatest variation in performance. We tend to measure things that are easy to collect data on and that show very little difference between providers.”

Catalyst for Payment Reform represents major employers dedicated to finding better ways to evaluate their health plans to achieve greater efficiencies and better outcomes. Among the members: Safeway, Dow Chemical, 3M and CALPERS, the mammoth California employee pension fund.

Delbanco said her organization is promoting reference-based pricing, where purchasers establish the price of a particular service, and the patient pays any additional costs beyond that. CALPERS uses this approach in hip and knee surgeries.

Others who testified at the hearing on high prices and low transparency in healthcare included Giovanni Colella, CEO and co-founder of Castlight Health; TIME magazine contributing editor Steven Brill; and Dr. Paul Ginsburg, president of the Center for Studying Health System Change.