Patients will shop around for lower-priced providers if rewarded, study finds

Financial rewards programs that pay patients if they receive care from lower-priced providers are effective at reducing healthcare spending, suggests a study published in Health Affairs.

The study — led by Christopher Whaley, an associate policy researcher at the Rand Corp. in Santa Monica, Calif. — examined a rewards program implemented in January 2017 by 29 employers with 269,875 eligible employees and dependents.

The rewards program was introduced by Health Care Service Corp., one of the nation's largest health plans, and applied to more than 130 elective services, such as MRI, CT scans and knee-replacement surgeries. Patients who received care from a designated lower-priced provider received $25 to $500, depending on the specific service and the relative price of the provider.

In the first 12 months of the program, researchers found a 2.1 percent reduction in prices paid for services eligible under the program, according to the study. This led to $2.3 million in savings, or about $8 per person annually.

Researchers said effects were largely in magnetic resonance imaging and ultrasounds.

"This structure is appealing to employers because, compared to alternative programs such as high-deductible health plans or reference pricing, it encourages patients to price shop without exposing them to increased out-of-pocket spending," the study authors wrote. "It is also easier for employers to implement financial 'carrots' instead of 'sticks.'"

 

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