Tuesday, January 12, 2010

Its the incentives, stupid.

Almost everyone knows that health care costs decrease when patient co-pays go up.  So why is IBM  eliminating them?
Big Blue has gone whole hog in eliminating primary care co-pays for most of its 115,000 U.S. employees. And notwithstanding the company's concern for employee health, it's betting that the action will yield positive numbers on its employee health insurance balance sheet.
Maybe they are doubling down on their investments in wellness programs. If theirs works as claimed, it would be the first.
The primary care copay waive is in character for IBM. It invested $79 million in wellness programs between 2004 and 2007, saving about $191 million in health-related costs, according to an announcement. It has also participated in patient-centered medical home initiatives. And it has been covering preventive care at 100% since 2006.

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