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Reference-based pricing: an evidence-based solution for lab services shopping.

L Doug Melton1, Kent Bradley, Patricia Lin Fu

  • 1701 Corporate Center Dr, Raleigh, NC 27607.

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Reference-based pricing (RBP) increased the use of lower-cost lab services. Members using an online tool to find services at or below the reference price showed higher compliance with cost-conscious selection.

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Area of Science:

  • Health Economics
  • Healthcare Management
  • Health Services Research

Background:

  • Reference-based pricing (RBP) is a strategy to control healthcare costs by setting a maximum price for a service.
  • Understanding the impact of RBP on patient utilization patterns is crucial for effective healthcare management.

Purpose of the Study:

  • To evaluate the effectiveness of RBP on the utilization of lab services at or below a predetermined reference price.
  • To assess the influence of an online shopping tool and member education on RBP compliance.

Main Methods:

  • A retrospective, quasi-experimental, matched, case-control pilot study.
  • Compared a study group (employees subject to RBP for lab services) with a reference group (not subject to RBP).
  • Utilized difference-in-difference regression to analyze changes in lab compliance.

Main Results:

  • The RBP group demonstrated significantly higher lab compliance (69% vs. 57%; P<.05).
  • Members using the online shopping tool achieved 76% compliance, compared to 68% for non-users within the RBP group (P<.01).
  • Online tool usage was reported by 7% of the study group prior to service utilization.

Conclusions:

  • Reference-based pricing effectively promotes cost-conscious selection of lab services.
  • Access to price transparency tools and RBP education enhances compliance.
  • Further research is recommended for RBP's impact on higher-cost services like radiology and specialty care.