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Paradigms for success in purchasing health care.

Paradigms for Success in Purchasing Health Care

At a conference conducted October 27 by the National Association of Employers on Health Care Action and the American College of Physician Executives, speakers addressed the changing picture for quality in the health care system and how buyers can ensure value in the purchase of health care. This column reports on one speaker's views on the purchasing decision.

There is "no one `silver bullet' solution for purchasing health care," stated Thomas E. Burns, Manager, Employee Benefits, General Electric Corp., at the conference, entitled "Quality Assurance in the '90s, in Winston-Salem, N.C. Speaking on "Purchasing Higher Quality Health Care Services," Mr. Burns, a member of the NAEHCA Board of Directors, stated that legislated benefits are not the solution and that managed care is the American model. Mr. Burns said that, "As an employer, you should try as many options as fit your culture. Health care management is really a philosophy that includes consideration of the employer's environment, culture, and total compensation approach." As outlined by Mr. Burns, his company's New Directions in Managed Care includes attention to the following elements: * Establishment of Preferred Medical

Plans (PMPs)

[right arrow]Metropolitan Network, Cincinnati,

Ohio, with a 40 percent enrollment.

[right arrow]CIGNA Network, Cleveland, Ohio,

with an anticipated 40 percent


[right arrow]PMPs include improved plan design

elements to provide incentives

missing from traditional plans for


[right arrow]PMPs use a primary physician


[right arrow]PMPs include specific risk targets

set in advance per employee--risk is

shared with carrier/network. * Redirection of company HMO


[right arrow]Reimbursement is age- and sex-adjusted

for specific employee

participation in a specific HMO.

[right arrow]Employee pays excess over

company contribution. * Child "Caring Program

[right arrow]Prenatal check-up incentives are in


[right arrow]Designed to avoid premature births

and resulting high health care costs. * Psychiatric Review

[right arrow]Use of Employee Assistance


[right arrow]Pilot for major business. * Outpatient testing precertification

[right arrow]In place for anticipated charges over


[right arrow]One subsidiary pilot. * Participate in Milwaukee Employer


[right arrow]Negotiated discounts. * PPOs without walls * Negotiate hospital discounts in

exchange for volume Mr. Burns said that, at General Electric, "we have retained old health care paradigms that work, and we are creating new health care paradigms, always seeking the paradigm that works."

Ruth H. Stack is President, National Association of Employers on Health Care Action, Key Biscayne, Fla.
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Title Annotation:the buyer's view
Author:Stack, Ruth H.
Publication:Physician Executive
Date:Jan 1, 1990
Previous Article:Court decisions hold implications for managed care plans - part one.
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