Episode Benefit Plans

  • Episode Benefit Plans are a new category of health insurance plan design that are a lower cost alternative to traditional PPOs and HMOs. These plans:
  • Leverage the use of bundled payments for expensive episodes of care.
  • Use price and quality transparency to drive beneficiary engagement.
  • Preserve the freedom to seek care from any physician or hospital.
  • Leverage the use of bundled payments for expensive episodes of care.
  • These plans can be a replacement for existing coverage or made available in a ‘multi-choice’ offering alongside PPOs, HMOs and other options.
  • Episode Benefit Plans can be fully insured or self-funded. They utilize provider networks with negotiated payment rates for fee-for-service and bundled episodes.

Many Features Are Similar To PPOs And HMOs

Use of incentives to stay ‘in network’

Programs to enhance a beneficiary’s connection to primary care physicians and virtual care options

Standard administrative programs for enrollment, eligibility, fulfillment, utilization management, provider credentialing, claims administration, pharmacy benefits, general administration, analytics, and reporting

Benefit designs that incorporate deductibles, coinsurance and out-of-pocket maximums

Unique Features Of Episode Benefit Plans

  • The use of time-based "Allowances" which represent the maximum amount payable for a specified range of services in a defined episode of care. This is typically All Care Related to those major healthcare events that are defined in the schedule of benefits as covered episodes of care.
  • Pricing transparency. Underlying these allowances are bundled payment contracts that guarantee the total cost for the treatments and services in a defined episode of care. This provides a path for employees to lower their out of pocket costs and avoid the crushing bills that can wipe out a family's savings.

Financial incentives for selecting efficient health care providers for a pending episode of care

These incentives are chosen by employers and can include contributing a portion of the savings (the spending that is less than the episode allowance in the benefit plan) to the employees’ Health Reimbursement Account, direct cash payments to employees, or other forms of rewards that may be offered in cooperation with pharmacies and health providers

For costs exceeding allowances, employers will generally choose increasing beneficiary cost sharing in the form of either increased out of pocket maximums, increased deductibles, or beneficiary liability for a portion of costs in excess of allowances – or some combination of the above based on employer design preference.

Cost sharing for spending above allowances will generally be handled in a manner similar to how Medicare defines the ‘donut hole’, in which a portion of excess costs are, up to a limit, borne by beneficiaries

Our Initial Target Markets

  • We are entering markets in a phased roll-out, beginning with metropolitan regions in Texas, Connecticut and New York, in that order.
  • We expect to enroll our first customers in early 2024.
  • If you would like to receive regular updates from our team, please send us a note at:
[email protected]