Employers saved $81 million in reduced premiums through HMO Buyers Group
Value-based purchasing strategy enables employers to use market leverage and share expenses
CHICAGO – The Chicago HMO Buyers Group has saved participating employers $81 million in reduced premiums over the past 15 years. The HMO Buyers Group is a service of the Midwest Health Purchasers Foundation (MHPF), an affiliate of the non-profit Midwest Business Group on Health (MBGH), with actuarial support from Towers Watson.
“Despite increased cost pressures due to the Affordable Care Act, the Chicago HMO Buyers Group once again has proven that there is significant value to be gained by leveraging the power of scale,” said Hank Bereman, senior consultant, Towers Watson. “The 6.7%, overall premium increase achieved by participants, which includes the ACA taxes, is in line with the overall increase in medical costs we project for 2014 and shows there is continued value in offering high-performing HMO plans as part of an employer’s overall benefits strategy.”
Employers participating in MHPF combine their purchasing power to negotiate premium rates and realize lower administrative costs. They receive quality information based on accredited HEDIS measures (preventive care and screening services) and CAHPS (patient experiences) questions developed by the National Committee on Quality Performance (NCQA) on participating HMOs. Additionally tied to each employer group HMO contract are clinical, administrative and satisfaction performance guarantees.
“About 15 years ago employers asked us to find a solution to increasing premiums and lack of information from their HMOs, said Larry Boress, MBGH president and CEO. “By combining dollars in premium negotiations, performance evaluation and performance guarantees, employers have been able to realize significant cost savings – proof that right HMO can have a real impact on costs.”
In addition to the HMO Buyers Group, MHPF also offers employers a Pharmacy Benefit Manager (PBM) Buyers Group, a health condition management program using pharmacist diabetes coaches, drug formulary services, and medical director services. This year MHPF will be looking at transparency services, and worksite health programs.
About the Midwest Health Purchasers Foundation
The Midwest Health Purchasers Foundation (MHPF) was created as a non-profit, taxable Illinois corporation in 1997 to enable members of the Midwest Business Group on Health to have a vehicle for the group purchasing of health care benefit programs, products and services. MHPF provides the due diligence needed to identify effective, high quality vendors and uses the potential of multiple employers’ purchasing dollars and covered lives to negotiate lower rates and umbrella agreements. www.mbgh.org/mhpf/home
About the Midwest Business Group on Health
With more than 100 member organizations, the Midwest Business Group on Health is one of the nation’s leading non-profit business groups of large, self-insured public and private employers. MBGH is an essential resource to support employers in effectively managing their health benefits through high-quality education, research, networking and benchmarking, as well as serving as catalyst for community initiatives to improve the quality, safety and cost-effectiveness of the health care delivery system. MBGH is a founding member of the National Business Coalition on Health. www.mbgh.org
For further information about this release and MBGH, contact: Cary Conway, MBGH Media Consultant