Business model matches businesses with providers

March 15, 2011

Open Health Market, a request for proposal (RFP) generation tool designed to allow employers of self-funded health plans to solicit and compare proposals directly from medical providers, is ready to launch.

Open Health Market, a request for proposal (RFP) generation tool designed to allow employers of self-funded health plans to solicit and compare proposals directly from medical providers, is ready to launch.

“It is principally designed to be an RFP generation tool between self-funded health plans and medical providers to allow them to manage their costs more directly,” says Donald Crandlemire, a business and healthcare attorney and Open Health Market’s founder.

He says employers are being expected to manage healthcare costs the same way they manage other costs, but to do so, they need more control.

While Crandlemire says insurers could use his compny’s RFP servcies for part of a population of patients as an added benefit, he hasn’t seen much interest among health plans.

“I've been in touch with a number of health plans in the Northeast, and my take is they are very resistant because this isn't their model. Some have expressed interest in it - but generally speaking, they have provider contracts that they sell. The contract model they have now preserves itself, rather than transforming healthcare.”

The Open Health Market business model intends to create cross-state partnerships to increase competition, rather than focusing on local areas.

“We'll go to market, issue RFPs and go to administrators and say ‘Administer this benefit,’” Crandlemire. “If not, then we’ll find someone who will. We’ll bring the people paying the bills closer to the providers. Plan administrators have a role to play there - but I expect it'll take some convincing or real innovation for them to incorporate it into their businesses.”

Crandlemire founded the business with Peter Hayes, former director of associate health and wellness for Hannaford Supermarkets, and Dr. Leonard Fromer, executive medical director of Group Practice Forum in Los Angeles. Crandlemire says he expects the company to sign its first major employer in the next 60 days.