Can financial incentives drive health care consumers to make better, more cost-effective choices?

Can financial incentives drive health care consumers to make better, more cost-effective choices?



Anthem Blue Cross and Blue Shield of New Hampshire believes they can work with its Compass SmartShopper program, which will reward its members with cash bonuses for choosing from a menu of cost-effective providers for outpatient medical services.



Compass SmartShopper program, previously only available in the large group market, was expanded at the beginning of the year to include small group business customers. Compass SmartShopper and Anthem's complimentary Site of Service initiative are designed to create greater competition in the health care market as Anthem funnels its members to high quality but lower cost providers for medical services such as lab tests and a wide range of outpatient surgical and diagnostic procedures that can have significant prices variations.



For example, Anthem cites the cost difference for an MRI procedure at two different locations in Manchester at around $1,000.



Lisa Guertin, president of Anthem Blue Cross and Blue Shield in New Hampshire, called Compass SmartShopper "a true win-win" proposition for employers and employees. According to Anthem, Compass SmartShopper has already saved $2 million in health care claims in the large group market (45 companies of 50 employees or more in New Hampshire) and more than $400,000 has been paid out to members in cash checks ranging from $25 to $500.



"Our state is fortunate to have a broad range of highly skilled physicians who provide high-quality health care services and are able to offer those services in a number of different physical locations," Guertin said. "However, there can be a broad variation in cost for the same services based on where they are performed, as much as 250 percent for some procedures. If employees choose to receive care in a lower-cost location, the employer benefits through lower claims costs and employees making informed health care decisions are rewarded for their engagement."



Robert Benedetto, director of small group sales for Anthem, said the expansion of the small group market (firms with 50 employees or less) has added 70,000 members to the program in New Hampshire. He said participation is "completely voluntary and confidential. And the program is location-based, not doctor-based, which means employees are not being asked to change doctors."



What Anthem does want to change in a big way is the passivity of members and their doctors when it comes to becoming aware and taking responsibility for health care costs.



"I never questioned where I would go or how much it would cost," Benedetto said. "That has been the culture for many years."



Benedetto said "transparency" is the key to changing behavior and increasing awareness of the role that individuals have in controlling health care costs.



"Not only can this effort represent a real cost avoidance to an employer, it can also support healthier and more productive employees as the program covers a range of recommended screenings," he said. "It is an important first step in providing an avenue for employees to protect the health benefits they have against the rising cost of medical inflation."



Anthem said the process begins when a member is referred by their physician for a medical service or diagnostic exam. The member then contacts Compass Health Care Advisers, which provides information for area health care providers. If a member chooses to receive care from a more cost-effective provider for his or her health care service, they qualify for financial incentives ranging from $25 to $500 depending on the health care service.



The program is exclusive to Anthem members and targets a growing list of more than 40 high volume elective procedures and tests including: carpal tunnel surgery, colonoscopy, CT (computerized tomography) scan, ear/nose/throat surgery, hernia repair, knee arthroscopy, mammogram, MRI, shoulder arthroscopy, sinus surgery, and upper GI diagnostic exams.



"These outpatient procedures represent a significant portion of premium dollars," he said.



New Hampshire represents a potential testing for health care cost innovations because the system is one of the costliest in the country yet among the highest in quality. The culture change dialogue between doctors and their patients over the types and costs of options has increased.



"Most physicians are not aware about the variability in pricing," said Dr. Richard Lafleur, Anthem's medical director and a practicing primary care physician in Derry. But with deductibles and overall health care costs continuing to rise, Lafleur said discussions are becoming more frequent and in greater detail.



"I would say that these discussions have really changed in the last year. It's been a positive light to see people so engaged in their care," he said. "I think providers in the state truly want to collaborate in a way that drives the system to maximum quality."



For more information, visit http://anthemsaves.com.