Why Does It Cost So Much?

You should know that 25% to 30% of healthcare costs are wasted on:

• Unnecessary Care
• Inappropriate Care
• Poor Quality Care

Do you want proof? Look at the evidence from the Institute of Medicine , Rand Corporation , the Midwest Business Group on Health , Pennsylvania Health Care Cost Containment Council , and the Leapfrog Group, just to name a few sources. RMP’s mission is to identify those wasted dollars and to develop a strategy to capture some or all them, thereby benefiting both the purchaser and the consumer.

Consider how we purchase health insurance to pay for care. There is an efficient way to purchase health insurance, and there is the traditional (and inefficient) way, used by most healthcare purchasers today. Insurance is intended to protect people from large, unpredictable costs. It is not for smaller, routine, and predictable expenses. When you purchase health insurance for the latter (as we do in healthcare), you are “trading dollars” with the insurance carrier, including a 40% or so markup for administration, overhead, profit, and reserves.

In other words, we are over insured for health care, which leads to over utilization of services. Over utilization leads much of the unnecessary, inappropriate, and poor quality care that is the source of wasted dollars. The solution is a well conceived strategy for taking control of your healthcare purchasing activities. RMP can help.