Loading...Loading...July 29, 2025
Like all health insurance companies, we negotiate contracts with health care systems and independent practices each year. These discussions focus not only on rates but include value-based arrangements outlining incentives for quality outcomes rather than merely volume. When we establish mutual goals with provider systems, such as avoiding unnecessary emergency department visits and preventing readmissions, we’re working toward cost management and improving care standards.
Our contracts with providers lay out which services are covered and at what price. Services include surgeries, minor procedures, treatments and telehealth appointments. This ultimately determines how much you as the employer, or your employees, will pay out of pocket, especially when a deductible has not been met.
A major portion of our business with provider systems is through employer-funded health plans. That means those plans are shouldering the cost of services for their employees and their families. When the cost of care goes up, those groups will end up paying more to provide coverage for employees.
Increasingly, contracts also include data-sharing requirements and joint care analysis, whether it’s redirecting care to more appropriate settings or streamlining administrative processes. These collaborative provisions offer shared savings programs and performance incentives that reward providers for delivering efficient, high-quality care.
Our premiums are based on what providers charge for health care. As a local, not-for-profit insurance company, we spend nearly 90 cents of every dollar directly on our members’ health care, and we operate at less than 1% gain each year. We’re legally required to charge rates that balance insurance risks and premiums while ensuring financial stability to continue paying member claims.
As stewards of our customers’ premium dollars, we have an obligation to ensure that we are doing the right thing for them. We work with providers to balance the increasing cost of care with appropriate compensation rates. And as we negotiate, our top priority is making sure your employees have access to high-value care at an affordable price.
When negotiations focus on shared objectives rather than just rates, we can create meaningful cost containment that benefits employers, our members and the health care system as a whole.