It’s Not About The Size Of The Dog In The Fight…

It’s about the size of the fight in the dog! I often hear from, or get the impression from employers that they believe that since they’re with a big insurance company like BUCA (Blue Cross, United, Cigna, Aetna) they have the best arrangement possible for their health insurance plan. That bigger is better in helping them with pricing and controlling health care costs. This couldn’t be farther from the truth!

The reality is that bigger is better if you want to pay the highest administrative expense, the worst negotiated discounts, the highest reinsurance premiums, the worst customer service, the highest cost prescription drugs, partial rebates, confinement to networks – the list goes on and on.

There are so many other competitive options for employers who are seeking innovative methods to control healthcare costs. While not the big dog in the fight like BUCA, these options are about the size of the fight in the dog! Programs that are committed to being Best In Class, are very nimble, accommodate employers, and have the best pricing available in every category. Here is what employers should be looking for in their “dog.”

Lowest administrative costs – Best In Class Third Party Administrators are not the big, public traded, bureaucratic behemoth that the BUCA is, and therefore can perform the same functions with better quality at a much reduced cost.

Better provider pricing – we have all been led to believe for decades that PPOs have the best pricing and that more volume gives insurance companies more negotiating power. While this is true for insurance companies to compete with one another, it is not in the best interests of an employer. Eliminating PPOs and implementing Reference Based Pricing (RBP) gives employers the very best pricing from all providers.

Reinsurance costs – why have BUCA markup reinsurance premiums when an employer can go direct? Eliminate profits to the insurance company and work directly with the carrier.

Better customer service – how many times have you called BUCA and been put into their phone system trying to guide you by pushing buttons, or put on hold indefinitely? Best In Class administrators know that they have to perform at a higher level and are committed to LIVE customer service, and give members a better experience.

Better prescription drug pricing – the BUCAs make a ton of money off prescription drugs through the health insurance plans they offer. How can they be saving their customers money when they profit from markups, passing on the cost of Specialty Drugs, and keeping some of your rebates? Aggressive programs that only make their money in administrative fees bring home the lowest costs for employers.

Open Access – why be confined to a network at all? Open Access means that members can go to any provider in the country with no penalties – ALL providers are paid at the “In Network” benefit level.

Now is the time to start planning for a change in how you purchase and manage your health insurance programs. The status quo is not giving businesses the results they need to attract and retain employees with competitive benefits and costs. Reducing one of the highest expenses on a company’s P&L can allow for higher wages and other benefits employees demand to work for your organization.

To do this you will have to change the manner in which you have historically utilized your broker or consultant, because they too financially benefit from the status quo. If you are ready to begin exploring some of these options, email me at or call me at 970.349.7707 and we can set up a time to chat.

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Frank Stichter