Healthcare Purchasing Strategies: How 2 Employers Are Driving Referrals Through RAND Hospital Price Transparency Findings

In a webinar titled “Data Insights: Leveraging RAND Hospital Price Transparency Findings to Drive Referrals,” from the fall webinar series titled, “Innovative Employers and Their Healthcare Purchasing Strategies,” Ryan Olmstead, MPH, director of member services at Catalyst for Payment Reform, moderated a panel consisting of guest speakers Candace Shaffer, MS, director of benefits at Purdue University, and Natalie Roberts, MBA, senior vice president of Monarch Beverage Company.

The RAND report, which showed how hospitals charged privately insured individuals 241% more than patients in Medicare, has highlighted new employer strategies such as using centers of excellence, direct consulting, and reference-based contracting, as well as on-site clinics referrals, which have been implemented by the 2 Indiana-based employers in the webinar.

Speaking first, Shaffer highlighted Purdue University’s 2013 implementation of the Center for Healthy Living, which prioritized the IHI Triple Aim, a balance of population health, experience of care, and per capita cost. After reviewing the data, it was found that utilization rates for the Center for Healthy Living were declining each year, which led to the use of customer service, focus groups, and operation analyses to understand issues in the system. In 2017, Shaffer noted steps that were taken to reform the system, consisting of choosing a new provider and rolling out a wellness program.

Within 6 months, the new provider exhibited a stark increase in primary care provider capacity, indicating an increased utilization of the system. Patients part of the system additionally had fewer emergency department visits, increased use of generalists, and had a less risk compared to those not participating.

The use of the RAND study, in addition to their own data, has now led to Purdue University’s upcoming 2020 benefit plan, which will focus on the patient through 6 pillars of cost, quality, choice, prevention, navigation, and access. In now understanding what populations need increased care, Shaffer noted that the RAND study has assisted in designing a strategy attributed to patient needs.

Speaking next, Roberts emphasized how even a smaller or mid-sized company like Monarch Beverage, can additionally benefit from the data provided in the RAND study. Of the 1100 people that Monarch Brewing covers, 85% of employees have a high deductible health plan, and 75% of those employees consider Monarch’s on-site healthcare center to be their primary care physician. Roberts reported that 99% of employees undergo their physicals on-site, further showing the impact of the company’s on-site facility.

Centering their healthcare philosophies on the needs of their employees (85% men) has served as a key focus in determining which innovations apply to their demographic. Roberts indicated that Monarch’s on-site health center will now be managed in-house, after years of independent and large health system management, which will increase responsibility on the company.

The ability to achieve these innovations in healthcare for their employees has been assisted by the use of the RAND study, notes Roberts. The missing links of knowing whether prices are fair, what tools are used by good consumers, education by consumers of health, and even education among healthcare delivery have all been complications encountered Roberts. “We believe it’s all about turning to the data, the data that’s in the RAND report, the data that we can find in terms of quality, and we have to focus on how to find the highest quality of care at the lowest cost,” said Roberts.

Roberts described that to understand who are the top physicians, what is needed for quality and price, and what the vehicle of delivery will look like, Monarch will utilize personally derived data, RAND study data, and additionally partner with the Indiana Health Information Exchange (IHIE). IHIE will provide clinical value reports directly to the clinic and will then have real-time information that decreases the lag of data or claims review which inhibits information distribution.