A State Purchaser’s Experience Controlling the Increasing Trend in Healthcare Costs: Direct Contracting Strategies & Centers of Excellence

By the end of 2018, over 60 percent of employers will have some form of direct contract with healthcare providers. Join this session, and learn about the State of South Dakota’s budget challenges and health care market dynamics that impacted the State’s decisions to implement a Primary Care Clinic pilot program and a Center of Excellence (COE) concept for the State employee health plan. In this session, attendees will hear about the development and implementation of the Primary Care Clinic pilot program and why the program did not attain the State’s goals. We will:

  • Review the process for COE Request for Proposal development, Payment Requirements, and Exclusive and Non-Exclusive Pricing
  • Discuss the development of negotiation strategies including direct negotiation with hospitals for COE procedures such as hip and knee replacements, cardiac, bariatric, gastrointestinal, and kidney disease
  • Hear about the challenges with implementing the COE and some stakeholders’ resistance to the program
  • Discover how the State managed the pushback to the COE and ultimately achieved plan savings that exceeded projections
  • Why the COE will be phased out and replaced with alternative cost saving strategies

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