By: Michael Wentzien, Vice President, Optum Advisory Services and Robert Adams, Vice President, Optum Advisory Services
This is the 6th blog of our eight part series “Bending the Cost Curve with Comprehensive Sourcing.”
Ever feel like the cost calculators many purchasers use aren’t capturing the full value you deliver? That’s the situation many payers face in competitive reviews, and it’s the challenge the Optum team helps address. The tools consultants use to evaluate a health plan can compartmentalize a plan’s offering. But it may not factor the best-in-class synergies that the plan is achieving from a holistic strategy.
A view into total cost of ownership using comprehensive clinical, financial and operational informatics can provide the insights you want to convey.
A case in point: turning negatives positive
To help your plan get to parity instead of immediately being eliminated from consideration, Optum provides credible clinical informatics that demonstrates how you are doing in relation to other plans. For example, by analyzing three markets at the local level, we get the context and relevant market comparisons that help form a clearer picture of your value. Our approach is actuarially sound to help create the narrative that keeps you in the conversation.
Consider the value of this approach: In one case study example, a payer experienced a 3.5% disadvantage compared to its competition in a local market. Through our analysis, we were able to deliver proof points to capture an additional 2.5%, thereby significantly enhancing their market position. In several other examples, payers again experienced significant improvement in their ability to capture additional value which ended up placing them in a more advantaged position. By not factoring total cost of ownership, compelling value was uncaptured —and the payer’s competitiveness was notably devalued in each situation. Taking a total cost of ownership approach can be a real game changer.
Not every payer can achieve these results. Some might be grappling with significant levels of disadvantage or may lack the clinical and administrative performance to capture additional value — or both. Others may believe their offering is strong, but likely it is fractionalized resulting in ratings that are lower than they need to be. In either case, this analysis gives all payers an objective view of their total performance, which can align and prioritize remediation or allow them to evolve their market facing messaging.
By analyzing the total cost of ownership, you can realize better competitiveness in articulating your full end-to-end value. That enables you to change the way you position your overall offering to prospects to include strategies such as clinical, specialty, prescription and engagement.
At Optum, we leverage blind data and deep insights to help you really understand the market opportunities. Because our knowledge is based on extensive experience, it’s operationalized, not theoretical. That means you get the actionable insights and analysis to learn how you can better compete now. What’s more, we identify new value drivers to help you be even more competitive in the future through modernization and total cost of ownership add-ons like payment integrity and care management — as detailed in the Everest white paper.
What is your biggest pain point? What holds you back from meeting your strategic goals? Consider how you can strengthen your performance by analyzing your total cost of ownership. Optum partners with payers like you to identify a more comprehensive model that strengthens your ability to compete based on your unique cost-saving value drivers. Learn more in this blog series and the resources below.
Read the Everest White Paper
Addressing Payer Costs through a Comprehensive Model: A Blueprint for Achieving Breakthrough Cost Savings
Watch Jimit Arora, Partner, Everest Group
Identifying the Most Optimal Sourcing Model from a TCO Perspective
View the Everest Infographic
Payers Can Save Up to 7x More through a Comprehensive Model
Connect with Optum to modernize your health care ecosystem
Catch up now on the articles you’ve missed in our “Bending the Cost Curve with Comprehensive Sourcing” series:
Part 6: Barriers to best-in-class: The case for articulating your full value
About the Authors:
With more than 20 years of consulting and leadership experience, Michael Wentzien has consulted and led delivery on solutions for health care, pharmaceutical, insurance and financial industries. He and his team address health care industry challenges spanning the continuum of people, process and technology using analytics to focus on answering customer questions to define and deliver value in the health plan and provider markets.
Robert Adams has more than 25 years of industry experience — from running health plans as CEO and in-network contracting to strategic partnerships and being a conduit with large clients. As an executive advisor, Robert has led initiatives focused on total cost of care, performance benchmarking, medical-behavioral integration and revitalizing growth.