WellPoint, the nation's second-largest insurer, is hopping aboard the reference-based pricing bandwagon come Jan. 1.
The Indianapolis-based company said it will begin offering employers a coverage plan for their workers that will include set prices for certain kinds of medical procedures. While reference-based pricing has been catching on, mostly in large employer plans, what's different this time is that WellPoint said it will offer set prices for 900 medical services.
Previously, organizations like CALPERS, the California employee pension plan, capped the amount it would pay for certain procedures such as hip and knee replacements. The WellPoint plan, if it proceeds as advertised, would essentially set the bar for a much broader range of services and would likely force many health providers to adjust to the standards.
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Employers have been waiting for just such an opportunity from a large insurer.
Some two-thirds of large employers surveyed by Aon Hewitt earlier this month said they were considering using reference-based pricing to control health coverage costs. With WellPoint's plan as a touchstone, benefits consultants who spoke with the Wall Street Journal said they expect to see widespread adoption by employers.
WellPoint said its plan would offer regional limits on specific medical services. If employees choose to spend more than the reference amount, they will be required to pay the difference.
WellPoint said its plan will give employers the option to rebate the cost of a procedure if an employee selects a service provider that performs a procedure at a price below the reference point.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
