Why pay more for an MRI when you don’t have to?

The price difference for MRIs in hospitals versus imaging centers is significant in many states. Take a look at the numbers given in a recent article by Jayne O’Donnell and Shari Rudavsky:

“This price spread was widest in Alaska, where the median price for hospital MRIs was $3,200 more than in imaging centers. Michigan wasn’t much better with a price difference of about $2,500.”

With the prices stretched to this extreme, people need to be aware of all the options available.

This raises many questions as to why the prices are vastly different. Are these imaging centers producing the same quality of work as hospitals? And the answer is yes!

One of the main things that affect the price difference is the operating costs that are involved in maintaining a hospital facility. This includes providing a large staff, offering services 24 hours a day, and updating equipment regularly. At an independently own imaging center, they do have these expenses.

In some cases, it may be smarter to get an MRI by withholding insurance information and paying out of pocket at an imaging center. This could save money for both the person getting the procedure and the employer’s who provide the health insurance plan. The key is to have a system in place where due diligence is done in order to provide the best care for the best price.

Read the article, Need an MRI? It pays to shop around. Big time., on USA Today for more information.

AstraZeneca Paves Way for Drug Advancement with Shelved Drugs

AstraZeneca’s researchers are now trying to provide rejected drugs and molecules with a second life. Instead of throwing them out after rejection, they search for their untapped potential.

This 9-person research team focuses on that fact that many successes come from past failures. What might not work for one disease could help with the development to combat another. And there is no sense wasting shelved drugs where they could be used to advance drug-related research.

In a recent article published by The Wall Street Journal, Denise Roland writes:

“AstraZeneca is aiming to build credibility with academic scientists as part of a broader move to drastically improve its research-and-development output, which until just a few years ago was among the industry’s worst. It hopes that making its unwanted molecules readily available to university researchers will give it an edge over its rivals, most of which are reluctant to dedicate resources to rejected drugs.”

The development of drugs in the United States is a major part of the increase in longevity around the world. Reusing data from past failures for future compounds in other areas is a great concept. Hopefully, this will transition to cost savings for companies and consumers of future products.

Read AstraZeneca Gives Rejected Drugs a Second Life, from The Wall Street Journal for more information.

Self-Insurance Protection Act (SIPA) Bill Seeks Congressional Support

While the health care repeal and replace continues to bounce around on the Congressional floor, so does the less talked about Self-Insurance Protection Act (SIPA) bill.

A group based out of South Carolina is seeking congressional support from a new presidential administration as it proposes the third version of the SIPA bill. This bill would exclude stop-loss insurance from the federal definition of health insurance, helping smaller businesses capitalize on self-funding options.

Since the Affordable Care Act, providing self-insured plans has been an option for smaller businesses. With the SIPA bill, this would still remain an option for those businesses, even if the ACA is repealed and replaced.

Allison Bell explains the benefits small businesses would receive from the SIPA bill:

“The SIPA bill could help employers with small self-insured plans get stop-loss insurance from entities other than major medical insurance providers, by blocking state efforts to apply major medical insurance rules to small stop-loss arrangements.”

However, there are also critics speaking up against this bill, saying that self-insured options hurt the market for fully insured group health coverage. Small businesses have been a monopoly market for fully insured, and the SIPA bill inherently validates the methodology of stop-loss coverage. This is something that fully insured advocates might not like.

Read the article, Self-insurance group asks Congress for stop-loss help, for more information.

The Case for Reference-Based Pricing

Many employers use cost-shifting health strategies to mitigate health care costs to their employees. But how far will companies go? The more costs that are pushed off onto employees, the less benefit they receive from the company’s health care plan.

There is a better solution to mitigate costs that will benefit not only the employer but also the employees.

Reference-based pricing uses demographics and fair pricing methodology to pay claims to hospitals and other health care facilities. With this strategy, employers gain the power to utilize fair pricing practices.

This cost saving method provides several benefits. To start, most patients are blind to the costs of various health care services and procedures. And it is not their fault! Because of the lack of transparency in the health care system, it is nearly impossible for individuals to navigate the confusing landscape.

As out-of-pocket costs are on the rise, both employers and employees are worried about the lack of information in the health care system. There is a constant question of what costs of services they may have to pay for themselves. Rarely do individuals know the cost of services or alternatives available in advance.

Reference-based pricing is all about transparency. Services with large cost variations without much change in quality are the main focus. Employees can save themselves, and their employers, money by asking for all alternatives available and selecting the most appropriate option.

With a special focus on the cost of each medical service or procedure, reference-based pricing helps to manage claims throughout the year,  typically resulting in lowering cost renewals at the beginning of the next plan year.