Payer approaches to patients/subscribers

Payer approaches to patients/subscribers

Payers have a number of opportunities to influence the behavior of patients or even their subscribers before they become patients. Governments have another set of levers for influencing the way the health system is used.

Partner and Chairman

KPMG in the UK


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Some of the approaches we see in low-cost systems include:

  • Providing incentives to patients to be price sensitive in the choice of providers or to encourage them to use primary care rather than seek specialist opinions. This can be done through structuring co-payments or providing tools to allow price comparisons
  • Offering a narrow network of approved high-quality, low-cost providers, and providing price incentives for subscribers to select them
  • Payers can provide coverage, including preventative care
  • Payers can also provide incentives for subscribers to adopt healthier lifestyles and take responsibility for self-care, particularly with chronic diseases
  • Some payers place limitations on coverage for certain procedures or offer policies that allow top ups – for example, for single rooms or extra amenities
  • Payers can also enable communities to develop methods of collective action, for example on insurance premium collection and mutual support
  • One interesting approach we observed occurs where providers themselves offer insurance, sometimes with limited coverage and weekly payments – cutting traditional insurers out of the value chain
  • Medical savings accounts in which patients can accrue savings in their use of healthcare to reduce premiums are used in Singapore and the US. There is some debate about how far these really change behaviors and they are unlikely to be transferrable to some markets
  • Governments have a range of additional options to support and help change public behavior which are outside the scope of this paper.

Case study: Discovery Health South Africa

Dr. Broomberg of Discovery Health South Africa described their mix of approaches:

  • Disease specific programs that can be prescribed by clinicians. Patients receive a personal plan and case management support; medication adherence is promoted through cell phones and wellness activities are set out for them
  • Medical savings accounts, co-pays for non-formulary drugs and other methods are used to influence behavior
  • Selective contracting and narrow networks incentivized by premium discounts
  • Working with the pharmaceutical industry to reduce drug costs and with physicians and hospitals to improve quality
  • Using data to make provider quality transparent
  • Pay for performance incentives to improve quality and compliance with best practice

In addition, Discovery Health’s Vitality program incentivizes members to be more committed to wellness by earning points by exercising, eating healthy foods and hitting physiological targets. This is done through a unique system based on the science of behavioral economics wherein members are provided with a range of immediate incentives similar to a consumer loyalty program.

The more points earned, the steeper the discounts in accessing the rewards, with the top points range often being free. These are typically lifestyle promotions such as deals on flights, hotels, car hire as well as discounts in many stores. Wellness promoting behavior is also made easy because the size of the member base allows Vitality to negotiate discounted access to gyms and retail food outlets as well as a wide range of health promoting partners. The program goes much further than similar schemes in richer countries.

Members are given an estimation of the gap between their chronological age and their ‘health status’ age and are given support and advice to close this. Vitality is able to show significant health gain and cost reduction through this program.

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