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Released: September 24, 2011

Employee incentives drive lower-cost health care

Source: Julie Appleby, Kaiser Health News

Sarah Gardner wants her company's employees to be savvy medical shoppers. So this year, she rolled out a plan that sets limits on how much the company will pay toward a range of tests and procedures, from MRIs to hysterectomies. Workers at Buffalo-based Prodigy Health now know to call their employee insurance plan to find a list of local doctors and facilities that meet the price. Or they can choose to go to a higher-price center elsewhere in the insurer's network and pay the difference themselves. Before the new program, workers' incentive to shop around was limited because they had no idea — or any easy way to find out — that prices for many types of medical treatments varied widely. A test at one center might be $3,700, while "right down the street they could get it for $900," says Gardner, the vice president of benefits at Prodigy, which provides benefit management for self-insured employers.

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