Teri, It would be helpful for your audience to know, and you may want to add that the WCIRB report also confirms the significant, continuing, multi-year increases in the fees paid by insurance carriers to their cost containment vendors – a year-over-year increase of 8.1%. Whereas medical payments rose 2.8%. The report indicates that $1 is being spent for cost containment for every $11 paid for medical services. How much is actually being saved? Insurance companies, or better still, their employer/customers should be asking about the return on investment from cost containment services. A corollary would be to determine how much added frictional costs are caused by cost containment services in order to arrive at the true cost of the cost containment activities.
Teri, It would be helpful for your audience to know, and you may want to add that the WCIRB report also confirms the significant, continuing, multi-year increases in the fees paid by insurance carriers to their cost containment vendors – a year-over-year increase of 8.1%. Whereas medical payments rose 2.8%. The report indicates that $1 is being spent for cost containment for every $11 paid for medical services. How much is actually being saved? Insurance companies, or better still, their employer/customers should be asking about the return on investment from cost containment services. A corollary would be to determine how much added frictional costs are caused by cost containment services in order to arrive at the true cost of the cost containment activities.