Hybrid Model Structure
RBP hybrid models combine reference-based pricing with direct contracts for high-volume providers. The employer negotiates direct contracts with the top 3–5 providers by utilization — typically the dominant health system and major physician groups. These providers accept negotiated rates (typically 130–150% of Medicare) and agree not to balance bill. All other providers are paid under RBP.
Hybrid Model Benefits
- Eliminates balance billing risk for 60–80% of utilization (covered by direct contracts)
- Achieves RBP savings for remaining 20–40% of utilization
- Provides members with a clear in-network experience for major providers
- Reduces member anxiety about balance billing
- Maintains competitive savings vs. commercial networks
Implementation Complexity
IQ Insight
Hybrid models require more administrative complexity than pure RBP — the employer must manage both direct contracts and RBP simultaneously. The TPA must be able to process claims under both direct contract rates and RBP rates. Member communication must explain both the direct contract network and the RBP process for out-of-network providers. Despite the complexity, hybrid models are increasingly popular because they address the primary weakness of pure RBP — balance billing risk.