In 2016, U.S. e-commerce sales are expected to reach more than $554 billion, and while most industries have embraced the e-commerce trend, health care is struggling to shift.
Currently, health care is a high cost, highly inefficient traditional model, which would benefit from the automation efficiencies and cost savings that come with a more optimal e-commerce model. According to SpendWell Health, part of the Cambia Health Solutions family of companies, health care remains a “labyrinth of complexity and confusion” for everyone, including consumers, members, patients, employers, providers and payers.
On the other hand, purchasing a plane ticket on Expedia is simple and straight-forward, allowing consumers to compare real prices (not a range or average price) across suppliers and purchase their tickets directly from a service provider (e.g., Delta Airlines) with accuracy and confidence pre-service. When this streamlined and efficient “marketplace” concept is applied to health care, everyone benefits – not just consumers. Here are three reasons health care should act like Expedia:
- Consumers / Members / Patients are more happy and savvy. The average cost of employer-sponsored health care for a family of four in America is $24,671, according to the 2015 Milliman Medical Index. Most public health exchange and individual premiums are increasing significantly in 2016. Health care e-commerce allows consumers to shop, in a benefits-integrated context, for health care services, compare prices, and buy instantly. As a result, they have a better understanding of their benefits coverage (covered vs. not covered, deductible status, co-insurance, etc.), more control over their health care spending, and can even save money.
- Providers receive prompt payment. Today, only 9 percent of patient amounts billed are paid within the first 30 days, but with health care e-commerce, providers receive payment in days, not weeks or months. According to the U.S. Healthcare Efficiency Index, providers can save up to $23 per order (per claim) through an e-commerce experience with consumers and payers. Simply put, health care e-commerce is good for our industry and foundational to the optimal new health care economy.
- Health plans reduce medical costs, administrative costs, build trust and improve satisfaction. When consumers are able to shop in a benefits-integrated marketplace for health care services with known prices, provider competition increases and medical costs decrease. Ongoing studies show that providers are willing to lower their current fees between 9-27 percent if patients pay their out of pocket cost share pre-service or at the point of service versus paying post-service. Additionally, health plans can lower administration costs through e-business efficiencies and build trust by assisting providers with their receivables. From an administrative cost savings perspective, health plans can save $6-12 per e-commerce order (per claim). Finally, ongoing health care e-commerce consumer experience and satisfaction research shows a Net Promoter Score above 77, which is well above retail industry benchmarks.
From plane tickets, to apparel, to health care, allowing consumers to purchase goods and services at known prices directly from providers is the key to a more sustainable economy. To learn more about how SpendWell is leading the way in modernizing health care, visit SpendWellHealth.com.
