RBP, It’s as Easy as 123How Reference Based Pricing

Can Drive Down Healthcare Costs

1. Problem: The cost of healthcare is hidden.With prices masked, there’s no incentive to choose low-cost providers.

Most patients have no idea how much their healthcare costs.

Patients pay only the first part of the cost (the deductible).The rest is left to their health plan. Often this cost falls to employers.

1. Solution: Reveal the true cost of healthcare.The health plan or employer sets a reference price for a given procedure.

Reference based pricing (RBP) flips the deductible model on its head.

The health plan or employer pays everything up to the reference price.The member pays out of pocket (OOP) for anything over the reference price.

2. Problem: Patients can’t easily compare providers.This information is not widely available, particularly in easy-to-understand formats.

RBP only works if patients have access to cost and quality information.

Patients are also often limited to the providers in their health plan networks.

2. Solution: Help patients shop for their healthcare.Provide easy web-based searches that include cost, quality, treatment, and location.

Give patients the tools they need to shop for their healthcare.

Patients can compare providers and make the best decision for their needs and their pocketbooks.

3. Problem: Current incentives don’t reward cost efficiency.Currently, patients have no incentive to choose low-cost providers, particularly for pricey procedures that are likely to go over the deductible amount.

RBP only works if the incentives are right.

Health providers aren’t incentivized to compete on price and quality since these factors are largely hidden.

3. Solution: Reward cost-conscious patients (& providers).Patients share in the savings when they choose low-cost providers.Patients share in the cost when they choose high-cost providers.

Patients have the power in an RBP model.

Providers are also incentivized to be cost-conscious since they must now compete for their patients’ business.

Learn how you can lower your health plan costs with RBP* at:

www.reference-based-pricing.com

*Called the “sleeper” in healthcare payment reform by The New York Times Economix blog