Market Overview

Collective Health Bends the Healthcare Cost Curve, Reducing Year-Over-Year Medical Costs for Self-Funded Employers


Platform-based approach to engaging members in the right care, and
reducing administrative waste, makes a dent in American companies' $1.2
trillion annual healthcare spend

A new report from Collective
shows the company lowered the cost of healthcare for clients
from 2016 to 2017, while providing the industry's leading member
experience. With a -0.3% medical trend, Collective Health effectively
decreased year-over-year costs, and saved returning clients an average
of $500 per member family in 2017.

This press release features multimedia. View the full release here:

Collective Health announces industry-leading medical trend (Graphic: Business Wire)

Collective Health announces industry-leading medical trend (Graphic: Business Wire)

Collective Health's approach addresses the increasing demand from the
country's largest private purchaser of health insurance, employers, that
face dramatically increasing costs. According to a recent survey by the
National Business Group on Health, national
healthcare costs are expected to rise by 5% for the sixth consecutive
year, with the expenditure per employee expected to hit nearly $15,000
in 2019

Using its end-to-end Workforce
Health Management System
, Collective Health reversed the trend by
helping its clients' employees—Collective Health's members—better
understand their healthcare options, and find the right kinds of care.
The report found the company also reduced billing errors, part of the
administrative waste that is prevalent in healthcare.

"With our latest report, we can empirically say that we're helping
enterprises care for their people while effectively managing their
healthcare spend," said Dr. Rajaie Batniji, co-founder and chief health
officer of Collective Health. "We're doing so by addressing the
technology problem that plagues health insurance. In the Employer-Driven
Healthcare Economy, a software-driven approach—one that breaks down data
silos to power intuitive products and unparalleled member support—can
help lower costs by helping people get the right kind of care, not
avoiding it."

Collective Health released more details on the savings in its new
"Controlling Employer Healthcare Costs" report. The report examines how
focusing on three key elements can help employers lower the cost of
healthcare while taking better care of their people.

Overall Medical Trend

Collective Health examined medical trend—the standard benchmark for
measuring healthcare costs—for returning clients to quantify the change
in healthcare costs per member from 2016 to 2017.

Trend for clients that have been with Collective Health since 1/1/2016
was an industry-leading -0.3%.

Member Engagement and Improved Decision Making

Diving deeper into medical trend, Collective Health found that a premium
member experience—one that combines trust, simple language that helps
people understand their options, intuitive product design, and the human
touch—helps increase engagement and lower costs.

In 2017, returning members who engaged with Collective Health Member
Advocates––the company's dedicated in-house concierge support team––not
only saw the biggest drop in medical trend (-0.8%), they also gave the
experience a 70+ Net Promoter Score1 .

Collective Health believes that a trusted relationship with members
helps inform their care decisions, ultimately helping people optimize
their choices. For example, Collective Health members reduced
unnecessary specialist visits (-9.2%), and advanced imaging (-5%).

Intuitive product design can also help members find and optimize care.
During the same time period, members increased utilization of
telemedicine (+100%) and behavioral health care (+6%). Collective Health
made it easier for members to access these services by:

  • Tightening integrations with third-party telemedicine solutions,
    making it effortless for members to securely login to offerings
    directly from Collective Health's web portal and mobile applications.
  • Introducing mobile
    out-of-network claims submission
    , which alleviates the burden of
    getting reimbursed for out-of-network claims––an issue all too common
    in behavioral health care. This in-app feature allows members to snap
    a picture of a claim, submit it, and get reimbursed––no fax machines,
    stamps, or envelopes needed.

Administrative Waste

As the end-to-end solution that brings every part of a health plan onto
a single platform and runs the financial side of healthcare for
clients—from forecasting, to reviewing claims, and ensuring members pay
the right out-of-pocket costs—Collective Health is uniquely positioned
to identify and to fix common billing and administration errors.

In 2017, the company not only found errors in 57% of invoices from a
subset of partners, Collective Health identified and fixed the errors
before any erroneous payments were made.

The full report can be downloaded here.

About Collective Health

Collective Health is powering the Employer-Driven Healthcare Economy
with the first Workforce Health Management System––giving employers a
platform to simultaneously manage their healthcare investment and take
better care of their people. With more than 120,000 members and 30
enterprise clients, Collective Health is reinventing the healthcare
experience for self-funded employers and their employees across the U.S.
Founded in October 2013 and headquartered in San Francisco, Collective
Health is backed by NEA, Founders Fund, GV, Sun Life, and other leading
investors. For more information, visit

1 We use Net Promoter Score (NPS) to measure our member
experience. NPS is an index ranging from -100 to 100 that measures the
willingness of customers to recommend a company's products or services
to others. At Collective Health, we measure post-inquiry NPS.

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