HEALTH SENSE
Trust helps keep lid on health costs By Tim Parker
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t is about dollars and sense. The cost of care in Alaska is among the highest in the country any way you slice it, but there are efforts underway here to push the cost of care down, leading to more disposable income for Last Frontier residents and growing our economy. An innovative approach is being used by the Public Education Health Trust, or PEHT, and other health trusts in the 49th state, and the numbers tell a story. In the past three years PEHT has saved the state of Alaska nearly $156 million, approximately $52 million per year, through our ability to make quick adaptations and by negotiating lower rates for our plan holders. Being small and nimble allows PEHT to act quickly and take advantage of opportunities, as we are not burdened by a cumbersome RFP process. If a quality deal becomes available, we can act immediately. Other trusts such as the Pacific Health Coalition have also saved millions of dollars for their plan holders and the state. So who are we and how does it work? PEHT is a nonprofit organization that provides services for 28 individual insurance purchasers at school districts, associations, school boards and others that provide public education services. Using minimal staffing and overhead, we pool large and small districts together to combine purchasing power, reduce costs, and increase the availability of benefits. We are nimble and can move quickly, allowing us to be strong, flexible negotiators. The PEHT vision is simple: maximize member benefits with quality care at the least cost. We spend more than 95 cents of every dollar we take in on cov-
ered medical services. We spend under 5 cents on every dollar on administration. Because PEHT members, staff, and leadership determine coverage benefits, our member health insurance providers work in the member’s interest to deliver the lowest administrative cost, advocating during appeals of any claim decision and plan provision interpretation. Our trust pool puts assets to work for the sole benefit of plan participants. The trust and the plans in it are under the control of elected trustees. Each member of PEHT has a vote in who represents their concerns with their health care needs. We support local choice and local control in providing low costs options for health insurance. Another innovative example that PEHT and other trusts are using is BridgeHealth. This medical tourism organization provides access to centers of excellence for scheduled procedures at substantial savings. BridgeHealth responds to savings opportunities when they arise, negotiating direct contracts with hospitals, providers, and accommodation facilities. They provide significant savings when compared to the same services rendered in Alaska. A few more statistics will help underscore the good things happening in Alaska. PEHT represents 28 public education groups, covers 17,000 people, and offers eight medical plans. In recent years, roughly half of the time our plan costs have either
Overall, for five years PEHT’s plan cost increases have averaged just a 2.7% increase. The innovative cost containment measures at PEHT are saving more than $9,000 per plan member per year. That translates to money in Alaska’s economy. decreased or seen no increases. Overall, for five years PEHT’s plan cost increases have averaged just a 2.7% increase. The innovative cost containment measures at PEHT are saving more than $9,000 per plan member per year. That translates to money in Alaska’s economy. Other trusts are finding success as well. In fact, Fred Brown, executive director of another Alaska-based organization, the Pacific Health Coalition, was recently elected president of the National Labor Alliance of Health Care Coalitions. The NLA is a nonprofit national organization of management, health, and welfare coalitions representing more than 6 million members. He was elected in part because of the innovation and excellence of trusts in Alaska. While the nation continues to debate health care, in Alaska there are ongoing innovations that save dollars and make sense. Tim Parker is a high school English teacher from Fairbanks now serving as the chair of the Public Education Health Trust. Tim loves making student learning happen in his classroom, and he looks forward to being back in the classroom this fall.
AlaskaPulse.com — April 2020 — ALASKA PULSE MONTHLY
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