As healthcare costs skyrocket, we know that employers struggle especially with high medical claims; how to fund them, mitigate them, and understand how they impact their plan. However, it has become increasingly difficult to accurately compare costs across different health plans and networks due to low transparency and complicated relationships among employers, brokers and bidders.

What is Claims Repricing?

This is where medical claims repricing comes into play. Using a third-party actuarial expert will enable a fair comparison through a rigorous data collection process and a systematic, objective analysis.

Repricing provides clients with an objective view of medical claims cost repricing based on actual claims data to help them pick the best network for containing costs. The purpose of repricing is to choose the best network providing desired provider coverage at the lowest available cost. It can be used to evaluate reference-based pricing as well as more traditional networks.

Why Claims Repricing?

Medical claims repricing helps clients compare medical claims costs across different health plans/networks on the same basis. It gives them a clear view of their options. The primary benefit of the repricing exercise is to provide an objective and actuarially sound analysis of claims cost comparison among different networks.

An accurate repricing analysis requires bidders to reprice each procedure performed by each provider according to their contracts. Without clear instructions and rigorous practice, bidders usually provide analysis on an aggregate level that does not reflect the demographics and experience of the client. Therefore, bidders’ self-reported results usually provide an apple-to-orange comparison and could be very misleading.

Medical Repricing Case Study

Client Challenges

Spring recently conducted this repricing process for a client in the dairy industry with over 1,500 employees and four manufacturing sites across different states. They were looking to understand if their carrier rates were competitive:

  • Would utilizing reference-based pricing (RBP) save costs?
  • Would it make sense to switch to a new carrier?
  • Did performance vary by state and major service category?

Spring Approach

Spring assists clients with choosing the right network. This will often be included in a formal Request for Proposal or handled more informally.  Spring facilitated the process using the following approach:

  • Requested detailed claim data from the incumbent including billed, allowed and paid amounts
  • Forwarded detailed instructions and claim data excluding allowed and paid amounts to prospective networks for repricing
  • Provided client with an independent actuarial repricing analysis by region and major service category

Our Solutions

Spring’s actuarial team conducted a rigorous medical repricing exercise and provided client with the following solutions:

  • Spring analyzed potential savings from utilizing a reference-based pricing vendor and determined that while moving to reference-based pricing would save on facility charges, the increase in other medical costs would outweigh these savings.
    • We did note that pairing the reference-based pricing solution for facility claims with a stronger non-facility network could potentially save money.
  • Spring also looked at claim charges for two other prospective networks and found that the incumbent carrier offers the highest overall discounts on claim charges, as illustrated below. In this case, switching entirely to either network will mean higher costs.

Medical Repricing

  • However, Spring provided further insight by state and major service category. Even though switching to bidder A means higher claim costs in total, the inpatient cost of bidder A was 26% lower than the incumbent in one state resulting in 10% overall savings for that state.

Medical Repricing

  • Spring recommended a national network solution carving out one state to maximize savings and minimize disruption.


Client Result

This analysis was valuable to the client in their consideration of carrier changes in certain regions:

  • Spring identified competitiveness of the incumbent carrier’s claim charges by state and service category
  • Spring’s analysis helped the client to make an informed decision not to move ahead with the reference-based pricing vendor as significant savings on facility costs were offset by increased physician and other medical costs
  • Recommended a new carrier in one state saving 10% of claim costs

As you can see, a repricing analysis can shed light on a slew of different factors at play within your network across different states and help you make the most cost-effective decision.

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Christine Culgin

Christine Culgin

Christine is Spring's Director of Marketing. She studied Spanish and Economics at Lafayette College and later went on to receive her master's degree in global marketing communications and advertising from Emerson College. Christine specializes in b2b marketing and handles content creation, email marketing, social media, blogging, SEO and event management here at Spring.