April 15, 2020

Questions you might not be asking your self-funded health plan administrator – but should be.

Part 2: Key questions you should consider asking your health plan partner about claims, clinical outreach, pharmacy and Rx reviews

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Evaluating your self-funded health plan: Part 2

(Read Part 1 of the Article Series)

It’s critical for employers to continually evaluate their self-funded healthcare plan to ensure it improves the health of employees while providing cost savings for the company. If your company feels like it’s time to evaluate an alternative health plan administrator, there are some key questions you’ll want to consider asking.

In Part 2 of this article series, we take a look at some questions organizations should consider asking their health plan partner in regards to claims, clinical outreach, pharmacy and Rx reviews.

Claims and Clinical Outreach

Q1:  Please describe your out-of-network claims negotiation process and any applicable fees per claim (i.e. percentage of savings etc…).

Why it’s important to know:  It’s important to know what can be expected from your healthcare partner as far as claim negotiations and associated costs – especially for routine out-of-network claims. Percentage of savings fees for simply processing these claims can add up significantly, and go unnoticed, since the fees are located within weekly check runs. Ask your administrator how much your organization paid in out-of-network claims processing or percentage of savings fees in the past 12 months.

Q2: Please describe your claims auditing process and if this is performed in-house or outsourced. Also, are there any applicable fees involved?

Why it’s important to know: Claims can account for up to 90% of an organization’s total healthcare spend. Claims require close, aligned oversight so outsourcing this function may cause gaps in how closely claims are proactively managed. Also, since claims contribute to such a large portion of healthcare spend, adding additional fees from an outside vendor to manage the claims oversight is something to be mindful of when considering adding this capability.

Q3: What qualifies as engagement for your clinical or advocacy programs? Can you describe how you track savings and engagement success?

Why it’s important to know: Tracking and measuring engagement metrics should be a standard program inclusion for any self-funded health plan’s programs. By learning the administrator’s benchmarks for clinical program engagement metrics and specifically how they are tracked, your company will be able to determine results and associated hard-cost savings. If your partner cannot provide you with these details, that may be a red flag you’ll want to investigate further – especially if you are paying for these programs.

Q4: How does your organization guide members to fair-cost, high-quality healthcare facilities?

  • Please elaborate on the process, systems and personnel involved.
  • What qualifies as a successful steerage or engagement encounter?

Why it’s important to know: It’s important that your health plan administrator goes beyond basic claims processing to ensure stronger health and financial outcomes for your organization. One key component of that is guiding your employees to the best healthcare facilities at the right price. The reason being that the price variance of common procedures can vary by 1,000% or more from one facility to another. This guidance can have a substantial impact on your company’s healthcare spend each year and the quality of care your employees receive. Ensure that your health plan partner is building trust with your employees and helping to create smarter healthcare consumers.

PBM’s and Rx Claims Reviews

Q: Please describe your pharmacy review process.

Why it’s important to know: It’s important to know how your pharmacy program controls cost beyond a competitive pharmacy contract. Transparency in pharmacy is more important than ever but so is daily oversight of your Rx claims. Especially since all PBMs get paid more based on the more drugs they fill. Are high-costing Rx reviews handled by the PBM or by an independent entity that is more aligned with your organization’s bottom-line? Do you feel confident that specialty drugs are being effectively audited and reviewed before approval by your PBM? Be sure to ask the right questions to validate that your pharmacy program works for you and not others involved in its placement.

Preparing questions and gaining insight:

Preparing questions to ask your health plan partner may seem like a daunting process, but it’s important to be as detailed as possible in order to gain insight into how your administrator handles claims, clinical outreach, pharmacy and Rx reviews. Paying close attention to these details will help your organization determine which healthcare partner may best align with your company’s goals and strategy.