Fees Benchmarking Study

Fees Benchmarking Study

A major compensation insurer wanted to understand the difference in the charges they paid on behalf of claimants for hospital and medical services compared to those paid by similar organisations.  The pure charges comparison was achieved by benchmarking, for each claim, the charges for the volume and service mix of the compensation insurer against those that would have been paid by the comparator organisations.

HealthConsult identified and approached collaborating partners who agreed to participate in the project, governed by applicable confidentiality agreements.  After data cleansing and validation, HealthConsult developed a series of simulation models that reflected the fee schedules and associated business rules for each comparator organisation.  The essence of the simulation process was the ability to derive the charge ‘per client’ under the fee schedule and business rules of the comparator organisations for the same service.

Benchmarking participants were able to use the results to explore fee schedule reengineering opportunities that could result in a significant claims liability reduction.