Spring is a season of renewal, and what better time to refresh your approach to healthcare spending? As an employer, you’re likely facing rising premiums, increasing deductibles, and frustrated employees who aren’t getting the care they need. You can’t pay less for healthcare unless you pay less for healthcare—and that means taking control of your costs with proven, transparent strategies that put YOU in charge.
If you keep using the same strategies, you’ll keep getting the same results. Insurance carriers aren’t motivated to reduce your costs—what you call a premium, they call revenue. So why continue playing their game? It’s time to step away from the traditional, bloated system and explore cost-saving alternatives that benefit your business AND your employees.
3 Strategies to Reduce Healthcare Costs Without Cutting Benefits
- Direct Contracting: Cut Out the Middleman and Negotiate Better Rates
- Reference-Based Pricing: Pay Fair Prices for Medical Services—Not Arbitrary Fees
- Transparent Pharmacy Benefits: Stop Overpaying for Prescription Drugs
1. Direct Contracting:
Cut Out the Middleman and Negotiate Better Rates
Would you ever let a third party dictate what you pay for office supplies, salaries, or equipment—with no transparency? That’s exactly what’s happening with your health insurance.
Insurers decide the price, dictate the terms, and take their cut-leaving you stuck with skyrocketing premiums.
The Solution: Direct Contracting
With direct contracting, you negotiate pricing directly with healthcare providers, cutting out unnecessary administrative fees and ensuring your employees receive quality care at a fair price. No more inflated markups, no more hidden costs-just better care for less money.
Lower Costs – Employers using direct contracting save up to 40% on healthcare expenses.
Faster Payments – Providers get paid quicker, eliminating the delays caused by insurance red tape.
Better Employee Satisfaction – Employees choose from high-quality providers instead of being restricted by an insurer’s narrow network.
Real-World Impact: One employer who switched to direct contracting cut their healthcare spend by 30% in the first year while offering employees better access to high-quality care.
Imagine what those savings could do for your bottom line!
2. Reference-Based Pricing:
Pay Fair Prices for Medical Services-Not Arbitrary Fees
Would you buy a car without knowing the price first? Would you agree to pay 500% more than the average cost for routine services? That’s what’s happening with traditional healthcare pricing-and employers are footing the bill.
The Problem:
Insurance carriers negotiate so-called “discounts” off inflated hospital prices, which aren’t based on real market costs. As a result, employers and employees are hit with surprise bills and constantly rising premiums.
The Solution: Direct Contracting
Instead of accepting insurance companies’ arbitrary pricing, RBP sets a fair and predictable benchmark-typically based on Medicare rates plus a reasonable margin.
- Predictable Costs – Know exactly what you’re paying before care is provided.
- Significant Savings – Employers save 20-50% on medical expenses with RBP.
- Transparency – No more inflated hospital charges-just fair, market-based pricing.
Time to Spring Clean Your Health Plan: If your benefits program relies on opaque pricing models and unpredictable cost increases, it’s time for a change.
3. Transparent Pharmacy Benefits:
Stop Overpaying for Prescription Drugs
Prescription drug costs are one of the biggest sources of waste in employer-sponsored health plans. Why? Because traditional Pharmacy Benefit Managers (PBMs) profit from hidden fees and inflated drug prices.
The Problem:
PBMs control how much you and your employees pay for prescriptions-but their pricing is rarely transparent. They inflate medication costs to boost their profits, leaving you and your workforce paying way more than necessary.
The Solution: A Transparent PBM
A transparent PBM eliminates hidden fees and guarantees pass-through pricing, ensuring you’re only paying the actual cost of medications-not an arbitrary markup.
Lower Drug Costs – Employers save up to 40% by switching to a transparent PBM Reduced Employee Expenses – Employees pay less out-of-pocket for their prescriptions.
Better Sourcing Options – Access to international pricing and specialty drug
discounts cuts costs dramatically.
Pro Tip: Many specialty drugs cost significantly less overseas. Sourcing medications from reputable international markets can cut pharmacy expenses in half—without affecting quality.
What Employers Should Do NOW
Spring is the perfect time to clean out outdated healthcare strategies and replace them with cost-effective, employee-friendly solutions. Here’s your roadmap to taking control of your healthcare spend:
Review Your Current Costs
Where are you overpaying? Are there hidden fees inflating your premiums?
Explore Alternative Reimbursement Models
Consider direct contracting, reference-based pricing. and bundled payments to lower costs while enhancing care.
Reevaluate Your Pharmacy Benefits
If your PBM isn’t completely transparent, you’re losing money.
Final Thought: You can’t pay less for healthcare unless you take control of your healthcare plan. The old way isn’t working—it’s time to spring into action and start saving today.
References
• Pillar Two – Alternative Reimbursement. (2023). Direct contracting, reference-based pricing, and bundled payments. Transparent Health Benefits.
• Pillar Three – Rx Drug Optimization. (2023). How to reduce pharmacy costs with transparent PBMs and international sourcing. Transparent Health Benefits.
