Reference Based Pricing
Reference based healthcare plans, or scheduled benefit plans, offer group health plans the ability to place limits on what will be paid by the health plan. This highly effective medical management strategy is designed to reduce healthcare spending by the employer while also engaging the healthcare consumer. With reference based pricing, your plan pays a fixed amount for certain procedures and contracts with quality-oriented, outcomes driven providers who agree to accept the fixed amounts as full payments. Plan enrollees are strongly encouraged to use those providers who have agreed to accept the fixed amounts. Non-contracted providers may be utilized, however, plan members are required to pay any cost differences out-of-pocket.
Reference Based Pricing Encourages:
- Providers to learn more about the prevailing costs of healthcare services.
- Consumers to review pricing information in advance.
- Both plan members and providers to take initiative in learning the true costs of healthcare services and avoid the substantial variations in pricing that can exist.
These improvements are sure to open the door to savings and to simpler, more transparent healthcare pricing.
SIP has helped many employer sponsored health plans combat rising costs by avoiding provider networks and adopting reference based pricing.