What's Next in Incentivizing Smart Healthcare Decisions?

February 8, 2024

Authored by Mark Stamper, VP of Commercial Products

Finding ways to help people make the best decisions for their health and wallets has always been a key quest for insurance companies and employers alike. These efforts, however, aimed at promoting better health outcomes and managing financial health, are fraught with obstacles.  

For example, chat with any doctor, and they'll regale you with tales of their valiant, yet often futile, efforts to get patients to do what’s good for their long-term health. It's a real-life rendition of the classic saying, "You can lead a horse to water, but you can't make it drink," especially when it comes to us humans following through on what's best for us.

A significant turning point in this endeavor is the introduction of healthcare price transparency tools, which offer a fresh way to encourage smart, personal health decisions. These new tools turn the old game of "do this, don't do that" into an adventure of informed choice, moving us from dodging penalties to rewarding positive behaviors.

Understanding Traditional Healthcare Incentives: The Carrots and the Sticks

Traditionally, making healthcare decisions has felt a bit like being nudged down a path, rather than deciding on it willingly. Historical methods to incentivize members have relied on a mix of rewards (the carrots) and penalties (the sticks), often pushing people towards certain predetermined healthcare choices.


This is exemplified within healthcare networks, where members are “guided” to the right, lower-cost care by choosing from a list of in-network providers. But ultimately, what this means, is that they face a “whack with a stick” (aka penalties or restrictions) if they step outside the network.

Copays, Deductibles, and Coinsurance

Similarly, cost-sharing mechanisms such as copays, deductibles, and coinsurance are designed to make individuals more financially vested in their healthcare decisions. While these approaches aim to foster prudence, they often lack the element of positive reinforcement for making informed choices. The focus on financial penalties can overshadow the opportunity to educate and empower members to seek value-driven healthcare.

The Power of Positivity

Moving away from penalizing poor health decisions towards rewarding positive behaviors marks a pivotal shift in healthcare strategy, leading to improved health outcomes and financial savings. Wellness programs that incentivize activities such as regular exercise, smoking cessation, and health screenings have shown to not only boost individual health but also significantly reduce healthcare costs.

An analysis in Health Affairs illustrates this shift's impact: every dollar spent on wellness incentive initiatives can save approximately $3.27 in medical expenses and about $2.73 in absenteeism costs. This transition underlines the effectiveness of positive reinforcement in promoting healthier lifestyles, which in turn contributes to lower healthcare expenditures and a healthier population.

Consumerism in Healthcare: The Rise of HSAs

A substantial development on this journey towards individual accountability is the introduction and growth of Health Savings Accounts (HSAs). These accounts allow individuals and families to pay for healthcare costs up to a certain limit, after which the insurance plan takes over.

This plan structure has garnered widespread adoption, with more than half of the U.S. commercial health market participants opting for HSA plans. In certain states, this figure soars to as high as 75%. They align personal interests with the pursuit of value-driven healthcare decisions, underlining the need for individuals to become consumers of healthcare and evolving how we should support them.

The Map to Informed Healthcare Decisions

But ahoy, here comes the treasure map - healthcare price transparency tools. Imagine these tools as a fun, interactive map, brimming with X’s that mark the spots of the best healthcare choices. These aren't your dusty, old maps; they're high-tech, personalized guides that light up with possibilities, showing people where they can find the best value care, avoiding the quicksand of unknown or unnecessary costs.

While up to this point, incentivizing individuals has been more about helping them avoid pitfalls than celebrating smart choices, the foundation is now set to start positively guiding people to better healthcare decisions.

Though the tools’ full potential remains largely untapped due to relative newness, their full benefits can be unlocked if a concerted effort takes place to encourage more active utilization. This entails education, outreach, and incentives that motivate members to embrace these tools.

A Journey Filled with Carrots

Here's a glimpse into how those incentives might be structured:

  1. The First Step on the Path: Just like in videogames, there’s always a reward for trying something new. Incentives for just taking transparency tools out for a spin can make a big difference in getting everyone on board.
  2. Bonus Points for Follow Through: Rewarding not only the initial tool exploration but also the choices made using the information, tracked through claims data, can keep the engagement party going strong.
  3. Treasure Chests Along the Way: Tangible benefits, such as bonuses to HSAs or magic keys that unlock lower copays, provide meaningful treasures that reward adventurers for their wise choices.
  4. Tailored Navigation: As more members delve into these tools, the opportunities evolve, offering tailored pathways. This can include spotlighting providers who excel in balancing cost with quality, or tiering results, ensuring each user's health journey is uniquely aligned with their needs.

Charting New Paths

The question of how to motivate individuals to make the best decisions for their health is age-old. With the integration of healthcare price transparency tools into incentive models, there is a new horizon in this quest.

By rewarding engagement and smart decision-making, we can foster a healthcare environment where financial and physical health are in harmony, driven by informed, cost-effective choices. The journey towards optimizing these incentives and overcoming barriers is ongoing, but the potential impact on healthcare decision-making is profound.


Mark Stamper is the Vice President of Commercial Products at Opyn Market®. Having spent 20+ years in the healthcare industry, he is passionate about empowering consumers to take charge and feel good about their healthcare decisions, for the first time.

You can reach him at mstamper@myopyn.com.

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