Can a rewards program incentivize patients to seek out lower cost imaging?

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Can a rewards program incentivize patients to seek out lower cost imaging?

by John W. Mitchell, Senior Correspondent | March 12, 2019
As the healthcare industry struggles to bring greater value to patients, a unique strategy in which patients are rewarded financially by their insurers for using lower cost providers may hold promise.

Such are the findings of a study published in the current issue of Health Affairs, which looked at several circumstances of consumer healthcare spending, including imaging.

“Many markets have wide variation in prices. There have been a variety of strategies to try and get patients to lower-priced providers,” Christopher Whaley, associate policy researcher at RAND Corporation told HCB News. “One unexplored way is to just simply pay patients for price shopping.”

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The study evaluated the impact of such a rewards program implemented in 2017. About 270,000 eligible employees/dependents with 29 employers participated in the program. The rewards program included 131 elective services, including imaging. Patients could receive between $25 to $500, depending upon the procedure and price.

In the first year, the rewards program achieved a 2.1 percent reduction in targeted services spending. This included an MR cost reduction of 4.7 percent and 2.5 percent less in ultrasound costs. There was no observed change in CT costs. The rewards program saved $2.3 million, or about $8 per covered life. The study did not observe any significant reduction in surgical services under the rewards program.

The availability of lower-priced providers may play a role in those savings; notably, there are many independent MR facilities but relatively few independent CT scan providers.

The study also stated that reference programs – which penalize patients for using higher-priced providers – saved roughly 15 percent per procedure.

“While reference pricing programs save money, this aspect has limited the popularity of reference pricing,” said Whaley. “Rewards program are one alternative to reference pricing. We find that the savings are smaller, but there are fewer potential risks to patient costs.”

The study noted that rewards programs are more popular with employers as this model is “less likely to cause financial hardship and create controversy among employees.” Also, the study speculated that patients might view imaging services more as a commodity, with patients perhaps more apprehensive about the quality of lower-priced surgeons.

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