Issue Brief | Jan 23, 2015

Reference Pricing: An Overview and Suggested Policy Considerations

Reference pricing is intended to reduce medical costs both for insurers and for purchasers of health care services, encouraging enrollees to obtain services from lower-cost providers and motivating higher cost providers to lower their reimbursement rates for those same services.  This issue brief, prepared by the Georgetown Health Policy Institute’s Center of Health Insurance Reforms, provides an overview of this pricing method and federal guidance that has been issued to date.  There are a number of factors that state and federal regulators should consider when reviewing plans that apply the pricing method, which are summarized in the issue brief, along with other policy considerations.