Reference Pricing, Consumer Cost-Sharing, and Insurer Spending for Advanced Imaging Tests

BACKGROUND:Fees charged for similar imaging tests often vary dramatically within the same market, leading to wide variation in insurer spending and consumer cost-sharing. Reference pricing is an insurance design that offers good coverage to patients up to a defined contribution limit but requires the patients who select high-priced facilities to pay the remainder out of pocket. OBJECTIVES:To measure the association between implementation of reference pricing and patient choice of facility, test prices, out-of-pocket spending, and insurer spending for advanced imaging (CT and MRI) procedures. RESEARCH DESIGN:Difference-in-differences multivariable analysis of insurance claims data. Study included 4751 employees of a national grocery chain (treatment group) and 23,428 enrollees in the nation’s largest private insurance plan (comparison group) that used CT or MRI tests between 2010 and 2013. MEASURES:Patient choice of facility, price paid per test, patient out-of-pocket cost-sharing, and employer spending. RESULTS:Compared with trends in prices paid by insurance enrollees not subject to reference pricing, and after adjusting for characteristics of tests and patients, implementation of reference pricing was associated with a 12.5% (95% CI, −25.0%, 2.1%) reduction in average price paid per test by the end of the second full year of the program for CT scans and a 10.5% (95% CI, −16.9%, 3.6%) for MRIs. Out-of-pocket cost-sharing by patients declined by $71,508 (13.8%). The savings accruing to employees amounted to 45.5% of total savings from reference pricing, with the remainder accruing to the employer. CONCLUSIONS:Implementation of reference pricing led to reductions in payments by both employer and employees.