Self-funded plans have little leverage to negotiate with providers: Study

Employers that self-fund their employees' insurance pay moderately more for several medical services than fully funded plans, a study published in the September issue of Health Affairs found. 

The study examined claims data from 2021 for enrollees in employer-sponsored plans administered by Aetna, Humana and more than 30 Blue Cross Blue Shield companies. The claims data showed plans fully funded by employers and administered by insurers paid more for some services. 

On average, self-funded plans paid 8 percent more than fully insured plans for endoscopies, 7 percent more for colonoscopies and 5 percent more for complete blood-count testing. Self-paid plans also paid 4 percent more on average for emergency department visits than fully insured plans. 

The study's authors wrote that the findings suggest it is not enough to rely on market-based negotiations between employers and providers to lower healthcare costs. 

"Although employer-sponsored insurance covers more than 156 million people nationally, even the largest U.S. employer (Walmart) employs fewer than two million people in the U.S., and these people are spread out across the country, limiting the employer's leverage to negotiate prices in any one market," the authors wrote. 

The study was written by researchers at the Health Care Cost Institute, which maintains a database of claims from several participating payers. 

Read the full study here. 

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