NEW YORK, Sept. 19, 2024 (GLOBE NEWSWIRE) -- Hospital prices are the core driver of high and rising healthcare costs and significant savings could be realized if employers and other purchasers – including unions – could more easily identify hospital price inflation and act on that information to reduce their healthcare spend. To help purchasers access this information the 32BJ Labor Industry Cooperation Fund (LICF) which is dedicated to containing healthcare costs for members of 32BJ SEIU and employers in New York and surrounding areas, developed a Healthcare Savings Calculator and model contract template. The resources were released today at The Price of Power: Confronting the Hospital Affordability Crisis national conference hosted with the 32BJ Health Fund.
Healthcare Savings Calculator
The calculator is designed to be used by any employer/purchaser regardless of analytical resources to gain an understanding of their own savings potential from lowering hospital prices. With only a few data points (e.g., number of employee subscribers and covered lives in a state), a purchaser can use the calculator to find out how much it could save on hospital spending by paying hospitals even a bit less than what they currently receive. For example, if an employer with 5,000 covered lives in New York spends $40 million on health benefits, this tool will show they could save $780,000 by paying just 5% less on hospital care.
Healthcare Administrator “Contract-first” Template
32BJ Health Fund has continued to challenge the status quo of the healthcare industry contracting process between purchasers and insurance carriers by negotiating with a “contract-first” strategy. This effort was undertaken to change the dynamic of the buying process and put the Health Fund more firmly in control of its data, provider contract terms, and choices for direct contracting, service carve-outs, and other innovations.
To participate in its most recent RFP for a third-party administrator vendor, the Health Fund required each bidder to redline the template contract, which obligated prospective partners to be transparent about any contractual restrictions that would reduce the applicability of promises made during the sales process. The resulting Healthcare Administrator Contract-first Template was also released today to enable other purchasers to use or reference to establish more fair and favorable terms with their carriers and third-party administrators.
“As a progressive and innovative purchaser, 32BJ Health Fund has sought to understand the cost drivers and change the way it buys healthcare using a contract-first strategy, with impressive results,” said Cora Opsahl, director, 32BJ Health Fund. “We have released this essential framework to the public so that other purchasers can work in partnership with us to advance our goal of providing high-quality affordable healthcare to plan participants.”
Coupled with the calculator, this resource is meant to reduce what is often an overwhelming process for many employers/purchasers.
Paying more than $1.5 billion in claims annually, 32BJ Health Fund is one of the largest self-insured funds in New York State, providing benefits for more than 210,000 covered lives (union members of SEIU 32BJ and their families), with contributions from 5,000+ employers, ranging from small businesses to global real estate firms across 12 states.
The Fund is a self-insured health plan, which means the cost of high-priced care is directly paid from the accumulated funds contributed on behalf of workers. The Fund has no profits or shareholders and is solely focused on providing workers with the highest quality healthcare it can afford.
“Getting smarter about how we negotiate and contract with plan administrators, providers and hospital systems is critical to fixing our nation’s broken healthcare system,” said Manny Pastreich, president of 32BJ SEIU. “No one purchaser can do it alone and fundamental change requires that private and public purchasers join together to realize reforms. We encourage all purchasers to leverage this new savings calculator and draft contract.”
About 32BJ Labor Industry Cooperation Trust Fund
The 32BJ Labor Industry Cooperation Trust Fund (LICF) is dedicated to containing healthcare costs, including healthcare pricing, for 32BJ members and employers in New York City and surrounding areas. The leading cause of skyrocketing healthcare costs for individuals, employers, and other payers is uncontrolled and irrational hospital pricing, which is not linked to higher quality. To address, LICF is leading the clarion call for hospital price transparency and accountability by dedicating resources to effect policy and other changes that lower healthcare costs. With the 32BJ Health Fund, LICF is committed to sustaining easy access to high-quality and lower-cost healthcare for 200,000+ union members and their families. Learn more: 32BJHealthInsights
Media contact: Cary Conway cary@conwaycommunication.com 214.793.5705
