Roundstone
Value-based plan design, reference-based pricing, community health plans and population health management were all hot topics at Roundstone’s first Medical Captive Forum. Michael Schroeder explains
What were the main trends discussed at Roundstone’s first Medical Captive Forum?
Numerous industry trends focused on Roundstone’s medical captive solution were discussed, including value-based plan design, reference-based pricing, community health plans and population health management. All are made possible by the captive solution’s delivery on its promise of transparency. Now that the employers know what is happening to their healthcare spend, all of these ideas found a receptive audience.
What are the best ways to optimise the pharmacy spend in a stop loss captive?
The cost savings offered by a carved out pharmacy benefit manager (PBM) presented a compelling alternative to the traditional health plan offering. Rebates from the drug manufacturers are significant and growing now that the pharmacies spend is increasing as a percentage of the total healt care spend. Making sure these rebates are quantified in a transparent environment so the employer can receive 100 percent of their benefit is important. A PBM carve out seemed to offer the best opportunity for realising a savings.
Plan designs structured to encourage the efficient use of medication from a generic and prescription quantity perspective also caught the employer’s attention as a wise approach to the pharmacy spend. Specialty drugs and their increased use also added to the importance of a focused effort on pharmacy.
What are the best ways to navigate ERISA and HIPAA in a captive programme?
Most of the third-party administrators offered comprehensive compliance solutions for these regulatory areas. The processes and documents of the stop-loss captive programme address both laws in an efficient and turnkey solution.
As discussed at the conference, which cost-cutting strategies would be best? And where should companies focus their energy when reducing the healthcare spend?
Cost cutting strategies that work best depend on each employer’s data. One firm may find a pharmacy carve out is most effective, while another employer may find the strongest cost containment comes from an incentive-based wellness programme or chronic disease management programme. Another employer may find it is value-based plan designs, or some employers may be attracted to the use of reference-based pricing or a provider sponsored network because the rental networks in their area are less than adequate.
Employers should focus their energy on the cost drivers that are exposed via data analytics made available from the transparency of the medical stop-loss captive. Regardless of one approach or many, you need data to determine the most effective cost cutting strategies.
What issues do medical captive insurance companies face?
A medical captive or stop-loss captive is built on a self-funded framework. Because of the recent predominance of fully insured carriers in this middle market space, the number of advisors knowledgeable and accepting of self-funding is limited. Bringing the advisor marketplace up to speed on the differences and advantages offered by not only self-funding, but a captive, is a sizable challenge.
Employers are eager for new ideas that respond to the ever increasing cost of the health benefit spend, but fully insured markets such as Blue Cross Blue Shield, United Healthcare and Anthem introduce myriad obstacles for employers interested in considering a new health insurance approach.
Commission structures offered by these fully insured markets sometimes make it difficult for employers to be presented with the benefits of Roundstone’s medical captive. When given the chance, however, the medical captive’s transparency and ability to mitigate year-over-year health benefit cost increases, making Roundstone’s medical captive an ever-increasing choice for the middle market.
Is there anything new in the pipeline for Roundstone’s medial captive insurance business?
Some new and evolving ideas for Roundstone’s medical captive programme include a voluntary benefits offering that fits well with the plan designs many of the employers are utilising today. We also introduced a large employer captive solution for medical stop-loss exposures. This programme, known as Large Market Med, offers reinsurance savings through direct access from a captive to the reinsurance market.
Lastly, community health plans with features including reference-based pricing are seeing an increased level of adoption with the Roundstone medical captive serving as the underlying turnkey insurance solution.
