Can CoE (Center of Excellence) be a solution to the rapidly booming healthcare costs?


By: Abhipsa Samantra -- Senior Research Analyst

31 March, 2014

Can CoE (Center of Excellence) be a solution to the rapidly booming healthcare costs?

Problem Statement: Currently, most of the benefits administrators in large sized companies are under constant pressure to cut down on healthcare costs and at the same time provide coverage to all the eligible employees (part time and full time) after the implementation of Obama Healthcare Reform (Affordability Care Act) on January 2014. Thus, what is the way moving forward to contain the rapidly increasing healthcare costs, growing y-o-y at 10% and provide a sustainable, low-cost, quality healthcare service delivery to employees in US? Abstract: Post ACA, companies are under pressure to shift towards low-cost, affordable and high coverage plans such as CoE-Center of Excellence healthcare set ?up. This model has a narrow tiered delivery network under Private Health Insurance Exchange model for self-funded Medi-care and Medicaid health benefits in US. This strategy is cited by some of the large sized F500 buyers to achieve low-cost, quick delivery of services for preventive /critical diseases with annual cost savings of nearly 10% to 25%. The whitepaper focuses on the buyer maturity and adoption trends for CoE after ACA verses broad-based health insurance networks such as PPO/HMO. It gives a benchmark for adoption of Value based Insurance models over PPO/HMO/CDHP Design by comparing various parameters such as size of the employees, no. of employees enrolled, size of the network, geography/demographics and type of industry. What is the concept of CoE-tiered network model and why is it introduced post ACA? ?Narrow? and ?tiered? are terms used to describe benefit plans where health insurance companies contract with a limited number of providers and offer different benefit levels depending on the contracting status of the provider and the provider?s quality of care.


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