A Wall Street Journal article highlights the costs involved in hiring a healthcare consultant to help businesses choose an insurer. The Journal examines the case of consultant Kevin Grady, a consultant who was hired to help one school district choose the best insurer for their needs. Grady was paid $35,000 a year for his services, but what the school district didn't know was that Grady was also being paid by UnitedHealth Group--to the tune of $517,138. His involvement with UnitedHealth was discovered after he'd suggested that the district switch to that insurer.
Critics say middlemen such as Grady are driving up the cost of healthcare by charging the system at both ends. They're receiving hefty fees from businesses who hire them and some also accept bonuses from insurers if they steer business their way. All of these extra costs get passed on to consumers. Experts recommend making sure that business know a consultant's financial ties before they accept any recommendations. If the consultant is recommending an insurer who is paying them, then the business may not be getting the best deal.
For more on consultants' financial ties:
- read this Wall Street Journal article (sub. req.)