ConnectedHealth Senior Vice President of Business Development Fred Karutz was recently interviewed for the article, “Oregon Carriers May Ask for a Mulligan After State Publishes Proposed Rates,” released by Atlantic Information Services in their May 16, 2013 issue of Inside Health Insurance Exchanges.
The article examined the rate-proposal process carriers undergo when participating in health-care insurance exchanges. In the Oregon insurance exchange, some carriers who submitted rate proposals earlier this month have already requested revisions to their offered rates. According to industry experts, providing more price transparency and side-by-side comparisons of health-care products will continue to drive more competitive bids in the marketplace from carriers.
Fred Karutz, Senior Vice President of Business Development at ConnectedHealth, calls the proposal process “health care’s version of ‘The Price is Right!’” But instead of individual contestants guessing the price of a refrigerator, health plans must predict the price for a set of benefits that will be most attractive to potential customers, he says. Dominant players with large blocks of consumer business — and deep pools of claims data — will be positioned to submit the most accurate bids. Carriers without that experience will need to “shadow price” the market leaders after the fact.
“Fair or not, the impact is a quick regression to the average best guess,” he tells HEX. “It’s not really driving competition and costs down, it’s getting the outliers priced right….In this game, data is king,” Karutz asserts.