GVTC reached this tipping point in 2015, when it saw a 22 percent jump in costs to its self-funded medical plan due to a couple of high claimants. “The tipping point is crucial,” Simmons says. “If GVTC had been trending along at 2 percent as they had for years, they might not have made the move. There's a tipping point all of our clients get to.”

Employers and employees reach a point of frustration. “I'm mad as hell and I'm not going to take it anymore,” Dendy says, borrowing a famous movie quote.

Cost is a major motivator, but it wasn't the only factor for GVTC. “I don't want to be the guy sitting there getting a 20 percent discount off the 500 or 600 percent markup of Medicare and think I'm getting a great deal,” Gitter says. “Everyone is going to end up moving one way or another. The last ones in are going to be paying more than anyone else. I'm not going to be the last one standing.”

2. Establish the long-term plan

So you've got a client fed up with their health care costs and ready to do something about it. Now what? Once you've opened the client's eyes to what they can get out of such a model, the next step is to define what they actually want, and how they can realistically achieve it.

For GVTC, a primary goal was limiting the incidence of high claimants that were wreaking havoc on the budget. “We had a couple really bad years,” Gitter says. “I'm watching the bank account looking at all of this, and it caused us to start looking at alternatives to PPOs, ways we could control costs.”

They tested the waters with medical billing review before deciding to jump headfirst into RBP. “I told them right from the beginning, you have to put your money where your mouth is. I've got to see it work,” Gitter says. “Son of a gun if they didn't come through with immediate cost savings on the medical bill review.”

When discussing RBP models, clients also need to have a full understanding of the relationship between all entities and how to create an arrangement that works for everyone. “Most of our clients are large and community providers,” Simmons says. “We could not have a situation where the front page of the news was 'GVTC Treats Local Hospital Unfairly.' Goal number one is to fairly reimburse providers. Cut everyone to the bone so there's no profit margin and you get terrible care.”

Goal number two? “We have to figure out how to protect the model,” Simmons continues.” You have to protect the future spend, as well. Not making a one-year decision, but a five- to seven-year strategic timeframe.”

Finally, the plan needs to take into consideration the members who will be using it. “A really big thing I don't want to overlook is the fact that we didn't touch personal physicians,” Gitter says, noting that the company instead decided to just target facility providers, getting the most bang for their buck while making the transition as painless as possible for employees.

3. Craft the message for employees

Behind the scenes, RBP requires a lot of paperwork and procedural changes. “The way that RBP is, you have to give some responsibility to the service provider to allow them to work with the provider who is submitting the claim,” Simmons explains. “It's new to them, and it was new to us as well. But most clients don't think about that.”

What they worry about more is that the model is new to employees. “It's really a meeting of the minds,” Dendy says. “An employer and employees have decided they want to have benefits, they want them to be affordable. The conversation with employees goes like this: 'We want to continue to offer this service. Here's why it's so expensive. Are you willing to work with us to have something different?' RBR is not as successful when the employer or broker makes that decision and doesn't have that communication with the members.”

When first introduced to RBP, employees often assume (incorrectly) that it will limit them to an approved list of providers and facilities. “They were really worried that they wouldn't be able to go to the doctor of their choice,” Gitter says. “We took that as an opportunity to be in control of the message and communication. I had to explain to them that this was all HIPAA protected, HR was not going to have access to their information. There's a whole process that we go through, and we recently refreshed our employee communication to help them understand how the process works.”

Employees' skepticism and confusion can cause them to throw up their guard, which is what Gitter encountered during initial meetings with employees. “One thing I said that resonated: 'Can anyone tell me what it costs just to have a doctor's visit? Or a tooth extraction? Appendix surgery?' They had no idea.” Gitter explained to employees the connection between those costs and the premiums the company and employees paid every year. “I explained that we have to be concerned about what these things cost, just like when you go to buy a new car.”