By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    learn to recognize and treat yeast infections
    Most Commonly Asked Questions About Yeast Infections
    November 17, 2021
    Advanced lung cancer diagnosis systems used by doctors
    Advanced Lung Cancer Diagnosis Systems Used by Doctors
    March 6, 2022
    The Top Benefits of a Wearable Blood Pressure Monitor Watch
    The Top Benefits of a Wearable Blood Pressure Monitor Watch
    June 13, 2022
    Latest News
    What To Expect On A Meditation Retreat In Miami
    February 6, 2023
    Botanical Extracts That Should be on Your Health Radar
    February 5, 2023
    Navigating Medical Care as a Wheelchair User
    February 4, 2023
    4 Common Myths and Misunderstandings About Brain Injuries
    February 5, 2023
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    gao report on standards healthcare
    GAO Report on Health Information Exchange Focuses on Standards
    April 1, 2014
    Does Medical Resident Work Hour Reform Reduce Medical Errors?
    April 8, 2013
    Accountable Care Organizations
    UW Medicine’s Journey to Become an Accountable Care Organization
    April 27, 2014
    Latest News
    Why Is a Referenced Based Pricing Tool Necessary?
    February 3, 2023
    Simplifying the Genetic Testing Process: How At-Home Kits are Changing the Game
    January 25, 2023
    9 Hospitals That Have Introduced Green Initiatives
    February 1, 2023
    Why a Health Retreat Can Be the Best Medicine
    January 12, 2023
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: When Employers Get Serious About Managing Health Care Risk
Share
Sign In
Notification Show More
Latest News
meditation retreat
What To Expect On A Meditation Retreat In Miami
Health
Guide To Pursuing a Career in Nursing as a Foreigner in the USA
Guide To Pursuing a Career in Nursing as a Foreigner in the USA
Career
Botanical Extracts
Botanical Extracts That Should be on Your Health Radar
Health
Navigating Medical Care as a Wheelchair User
Navigating Medical Care as a Wheelchair User
Health
common misconseptions about brain injuries
4 Common Myths and Misunderstandings About Brain Injuries
Health
Aa
Health Works CollectiveHealth Works Collective
Aa
Search
Have an existing account? Sign In
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Health Reform > When Employers Get Serious About Managing Health Care Risk
BusinessHealth ReformMedical EducationPolicy & Law

When Employers Get Serious About Managing Health Care Risk

Brian Klepper
Last updated: 2013/04/09 at 7:28 AM
Brian Klepper
Share
6 Min Read
SHARE

health care coalitionLast week I visited with Gary Rost, an unassumingly knowledgeable man and the Executive Director of the Savannah Business Group (SBG), arguably one of the most effective health care coalitions in the country. Their offices are only a couple hours away from my home on the Northeast Florida coast, so it was a quick trip up.

health care coalitionLast week I visited with Gary Rost, an unassumingly knowledgeable man and the Executive Director of the Savannah Business Group (SBG), arguably one of the most effective health care coalitions in the country. Their offices are only a couple hours away from my home on the Northeast Florida coast, so it was a quick trip up.

SBG was founded in 1982 as a way of mobilizing employer buying power for better care at lower cost. Its reach now extends beyond Savannah about an hour south, north into South Carolina and west from the coast. The vision described on its site is straightforward and easy for purchasers to appreciate:

managing risk“SBG endorses and adheres to the principles of value-based purchasing: performance measurement, transparency, public reporting, pay for performance, informed consumer choice and collective employer leadership.”

More Read

HR staff must deal with divisive views in healthcare

HR Must Navigate Polarizing Views in Healthcare Workplaces

Should Hospitals Use SASE or Traditional Network Security?
6 Tips for Getting Into Medical School
The Technology and Services You Need to Open Your Own Counseling Office
Do You Need Life Insurance? What Does It Cover?

Gary arrived a decade after SBG’s founding and has led the organization for 20 years. He aggregates and analyzes the med/surg and Rx claims data of his 23 regional member companies and governmental agencies, representing more than 16,000 employees and 35,000 covered lives. More important, he has used those data to inform activities that favor performance and value, and that try to steer away from poor care. He has formed a narrow high-performance provider network that is available only to SBG members, and has required the two major health systems to compete for a sole-source arrangement with his members’ plans. He has developed favorable drug, lab and vision arrangements. He has a variety of projects underway that focus on improving quality and value in the greater Savannah marketplace.

To its credit, SBG’s vision is long term and bigger than its own members’ immediate interest. Mr. Rost is proud of his members’ wellness/prevention efforts and says that, in his experience, those that deploy these approaches have lower overall costs than those who don’t. His group has had a hand in developing model disease management programs for SBG’s members. And SBG takes it as an article of faith that their efforts on behalf of members should also improve the health status and lower the health cost burden of the larger Savannah community.

healthcare premiumsTheir results have been compelling. In the decade leading up to 2010, the average cost per employee of SBG’s members grew at less than half the 90 percent national rate of premium inflation, by only 44 percent (a 4.1 percent annual premium growth rate).

SBG’s members’ health plans outperformed those of Savannah’s non-SBG firms as well. For example, in 2010 the City of Savannah, an SBG member, spent just under $23 million for group health coverage on 3,250 employees and their families, an average cost per employee per year (PEPY) of $7,007. Chatham County, not an SBG member, came in at $12,619 PEPY, or 80 percent higher. To put that difference into perspective, assume that, all else being equal, the County handed over an additional $5.6 million per 1,000 employees to Savannah’s provider community.

Hard savings numbers like this are rare from business health coalitions, and beg the question, “What did SBG do differently?” One answer is that they have gone beyond merely collecting, analyzing and posting data. They have not merely hoped that their actions will encourage their members’ purchasing behaviors. Instead, SBG has become an active change agent for its members.

This approach has also undoubtedly transformed, to some degree, the way medicine is practiced in Savannah, though the performance numbers of non-SBG firms’ suggest that this is still only marginal. High performing physicians, hospitals and other services are identified and rewarded with preferred status. Low performing ones are, to the degree possible, bypassed. In other words, SBG’s members have used a variety of market forces to convey that they will actively seek higher value care. They insist that a community’s prosperity is tied to health value that does not place an unreasonable burden on purchasers.

The challenge now is to replicate what Gary and SBG have learned and make their knowledge and tactics readily available to employers and coalitions around the country. SBG has a history of sharing and would undoubtedly be amenable. The question now is whether, faced with untenable health care cost burdens, employers around the country will finally band together to begin to heal health care.

Market-based employer collaboratives like SBG can create successful results anywhere. Of course, bringing health care back into balance will also require that employers collaborate on policy, establishing a way to monitor and be a counterweight to the health care industry’s domination of Congress and the legislatures.

Following SBG’s lead – bringing employers together to act decisively in their own interests in the market and on policy – is a good place to start.

TAGGED: healthcare coalition, SBG

Sign Up For Daily Newsletter

Be keep up! Get the latest breaking news delivered straight to your inbox.
By signing up, you agree to our Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
Brian Klepper April 9, 2013
Share this Article
Facebook Twitter Copy Link Print
Share
Previous Article Image High Quality, Low Cost HealthCare Video Interview Series: Kevin Palattao and Virtuwell
Next Article DL_month_TV_800x600 Myths and Misconceptions about Organ and Tissue Donation

Stay Connected

1.5k Followers Like
4.5k Followers Follow
2.8k Followers Pin
136k Subscribers Subscribe

Latest News

meditation retreat
What To Expect On A Meditation Retreat In Miami
Health February 6, 2023
Guide To Pursuing a Career in Nursing as a Foreigner in the USA
Guide To Pursuing a Career in Nursing as a Foreigner in the USA
Career February 5, 2023
Botanical Extracts
Botanical Extracts That Should be on Your Health Radar
Health February 5, 2023
Navigating Medical Care as a Wheelchair User
Navigating Medical Care as a Wheelchair User
Health February 4, 2023

You Might also Like

Health care

Why Is a Referenced Based Pricing Tool Necessary?

February 3, 2023
at-home genetic testing method kits
Global Healthcare

Simplifying the Genetic Testing Process: How At-Home Kits are Changing the Game

January 25, 2023
green hospitals
Hospital Administration

9 Hospitals That Have Introduced Green Initiatives

January 20, 2023
benefits of going on a health retreat
Global HealthcareHealth

Why a Health Retreat Can Be the Best Medicine

January 12, 2023
//

We influence million of users and is the most authentic source of information on healthcare business and technology news.

Quick Links

  • About
  • Contact
  • Privacy
Subscribe

Subscribe to our newsletter to get our newest articles instantly!

Follow US

© 2008-2023 HealthWorks Collective. All Rights Reserved.

Removed from reading list

Undo
Welcome Back!

Sign in to your account

Lost your password?