Multi-state professional services firm builds high-performance network and cuts PEPM 19%
Case study by Corry Hull, REBC®, CSFS®
19%
PEPM reduction year over year
27%
Prior 3-year PEPM growth reversed
6
States covered by new network
82%
Navigation vendor engagement rate
The Challenge
A 160-life multi-state professional services firm had employees in six states with inconsistent network access and high out-of-network utilization. Their PPO network had no quality tiering, and employees were defaulting to high-cost facilities for routine procedures. PEPM costs had grown 27% over three years.
The Approach
A high-performance network was constructed using a Centers of Excellence model for high-cost procedures combined with a reference-based pricing overlay for facility claims. Employees received a navigation vendor to guide them to high-quality, lower-cost providers. Out-of-network claims were repriced using a transparent methodology.
Note: This case study is a composite of multiple employer engagements. Network performance data is from TPA claims reports and navigation vendor utilization data. Sources: TPA claims reports; navigation vendor utilization data; Centers of Excellence outcomes data; reference-based pricing reconciliation.
Methodology & Verification▾
Baseline
PEPM costs in the 12 months prior to high-performance network implementation.
Intervention
Centers of Excellence for high-cost procedures, reference-based pricing overlay, navigation vendor.
Measurement period
12 months post-implementation.
Savings methodology
PEPM reduction = (baseline PEPM) minus (post-intervention PEPM). Navigation vendor savings from avoided high-cost facility claims.
What was excluded
Navigation vendor fees and COE program costs included in PEPM calculation.
Employer size
160 benefit-eligible employees across six states; ~140 enrolled in medical.
Funding type
Self-funded with reference-based pricing overlay.
Source / verification
PEPM data verified against TPA financial reports. Navigation engagement rates from vendor reporting.