The Benefits Blog

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How Do I Know if a Healthcare Purchasing Coalition Will Work for My Company?

Jun 27, 2023 11:58:38 AM

Something to think about:

In today's rapidly evolving healthcare landscape, businesses are constantly seeking ways to provide quality healthcare benefits for their employees while managing costs effectively. Joining a healthcare purchasing coalition should be a strategic decision for companies aiming to enhance employee benefits and control healthcare costs. These coalitions bring together multiple businesses to leverage their collective purchasing power, negotiate better rates with healthcare providers, and streamline administrative processes. However, before making a decision, it's important to evaluate whether a coalition is the right fit for your company. In this article, we will explore key factors to consider when assessing the viability of a healthcare purchasing coalition for your organization.

1. Company Size and Industry:

Taking into account the size of the company and the industry it operates in is essential. Healthcare purchasing coalitions often offer more benefits for smaller to mid-sized businesses that may lack the negotiating power of larger corporations. These companies typically have less than 500 employees.  Additionally, certain industries with a high concentration of small businesses may have coalitions specifically tailored to their unique needs.

2. Employee Base and Geographical Location:

Evaluate the demographics and healthcare needs of your employee base. If your employees are scattered across different geographical locations, it is advantageous to join a coalition with a broad network of providers in those areas. Taking into consideration the specific healthcare services and specialties required by your employees to ensure that the coalition can meet those needs effectively is key.

3. Cost Savings and Quality of Care:

Determine whether joining a healthcare purchasing coalition will result in significant cost savings compared to your current healthcare arrangements. It is important to assess the coalition's track record in negotiating favorable contracts and their ability to control costs over time. Investigate the quality of care provided by the coalition's network of healthcare providers to ensure it meets your organization's standards.

4. Administrative Support and Services:

Examine the administrative support and services offered by the coalition. These may include claims processing, enrollment assistance, member support, and data analytics. Assess whether the coalition's administrative capabilities align with your company's requirements and whether they can effectively support your employees' healthcare needs.

5. Long-Term Goals and Flexibility:

Consider your company's long-term goals and growth plans. Will the coalition be able to adapt and accommodate your evolving potential growth needs as your business expands? Flexibility in plan design, provider networks, and benefit offerings should be considered when evaluating the viability of a healthcare purchasing coalition.

In Conclusion:

Joining a healthcare purchasing coalition can be a strategic decision for companies looking to enhance their employee benefits and control healthcare costs. By thoroughly evaluating company size, industry, employee needs, cost savings, quality of care, administrative support, and long-term goals, organizations can determine whether joining a healthcare purchasing coalition will effectively provide employees with high-quality healthcare while optimizing your budget.

Mick Rodgers
Written by Mick Rodgers

Mick Rodgers is the Managing Partner of Axial Benefits Group (ABG) and Founder of the Alliance Healthcare Coalition (AHC), a nationwide healthcare purchasing coalition. Mick has been called a pioneer and a disrupter, but has always had a focus on disintermediation. He received the prestigious “Adviser of the Year” award from Employee Benefits Adviser Magazine in 2017, as well as the 2018 "Leadership Award" from the Association for Insurance Leadership.