Helping Employers and Employees Save Money in a Recession
Whatever you believe about COVID-19, it’s clear that we’re likely headed for a nasty recession. Hence, how can we help employers reduce their outlays when their bottom line is awash in red ink? One way to do that is to tackle the high cost and ineffectiveness of orthopedic care.
At the height of the great recession of 2008, we had 2.2 million excess unemployed. As of last week, we had 30 million with many believing that by the end of this week we could see 40 million. Hence, it’s clear that most companies will be hit one way or the other by this COVID-19 caused economic downturn. So how can we help companies make all of that red ink look better?
The Huge Corporate Cost of Healthcare
When manufacturing a new car, GM spends more on healthcare than it does on steel. Let that sink in for a second, because as a company, it’s not alone. Many companies have as their single biggest line-item cost the amount they spend on health insurance.
To bend that cost curve down, many employers have become “self-funded”. This means that they don’t pay a big insurance company for an insurance plan, instead, they pay their own healthcare bills out of the company and then also pay an administrator for the use of a provider network and contracts.
Bending the Cost of Orthopedic Care
Orthopedic care is hugely expensive. It’s usually the single biggest cost in that monthly health care bill. The problem is that much of it doesn’t work well or doesn’t have research to show it works. Take for example the most common elective orthopedic surgery in America, which is an arthroscopic partial meniscectomy. That procedure has been shown in multiple randomized controlled trials to be ineffective, yet it’s still routinely done in every hospital in the country. If you’re an employer with a self-funded health plan, you get to write the check for that ineffective surgery. That’s where Regenexx comes in.
Jason Hellickson on Regenexx
Jason Hellickson is a former insurance executive who saw that Regenexx could save self-funded plans big money after he decided to skip orthopedic surgery and get a Regenexx procedure himself. He tells his story here on the “Reconstructing healthcare” podcast.
Regenexx Corporate Program
Jason helped build the Regenexx Corporate Program that allows self-funded plans to offer less invasive interventional orthobiologics to their employees. So instead of that meniscus surgery, the patient can opt to get an injection of their own platelets or stem cells and have that covered through their health plan. That can save the employee a surgery that we know doesn’t work and the employer can save up to 50% or more. To date, Regenexx has signed on companies with coverage of more than 7 million employees. We expect our ability to bring new companies on to our corporate program will accelerate during the pandemic, as these companies struggle to improve profits.
The upshot? COVID-19 will take a big bite out of corporate budgets this year. While you can’t change the price of steel if you’re GM, you can reduce your healthcare costs to improve your bottom line. One way to do that is to push down the cost of orthopedic care. On that front, we’ve got you covered at Regenexx!