Cost Containment born in the USA, now reaching the world: an introduction to Phia International

Phia International has emerged from the joining of JCDC and The Phia Group LLC.  JCDC was established in 2014 to be a boutique cost containment firm based out of Sherbrooke, Quebec, Canada, with a reputation for delivering the highest savings at a fair price with superlative customer service. The Phia Group is the premier provider of cost containment services in the US, with over 20 years of industry experience; more than 200 employees – of which 25 are attorneys – spread across the US and Canada; 1,000+ clients, including third party administrators, insurance carriers, reinsurers, and brokers; and providing services and benefits for over 12 million US domestic lives.

The Phia Group acquired JCDC in July 2020 and founded Phia International to help the international travel insurance payer community stop overpaying on US medical claims and to avert unnecessary expenses through expert consulting.

A combined wealth of expertise, experience and resources

Phia International may seem ‘new’, but it builds on the international client experience of JCDC, which was headlined by two well-respected cost containment industry gurus: Jason Davis and Nick Fitzsimmons, both previously with international cost containment firms, and who have nearly 40 years of combined experience. In addition to helping international payers, JCDC also worked directly with The Phia Group for the last seven years as a consultant to help support their continued growth in the US cost containment space. 

“JCDC grew exponentially every year, and so we needed to quickly expand or look for a partnership,” stated Jason Davis, former CEO of JCDC and current SVP of Provider Relations with The Phia Group. “I remember a client telling me they were comparing JCDC’s superior savings results with a competitor who simply scoffed by saying that JCDC was good, but simply was not able to handle high volumes. I remember thinking that the international community deserves better.” Jason added: “As we knew The Phia Group inside and out from our work together, the acquisition with them just made perfect sense, and we knew that we could increase our impact for our international clients and the industry as a whole.” 

Now, through Phia International, this combined wealth of expertise, experience and resources are available for payers and administrators domiciled outside the US; all managed by people that understand the unique needs of the international payer community.  “Our domestic American clients think they have it bad with medical expenses, and they do, but I was absolutely horrified about how much international payers are routinely paying on their US claims; a US payer would never tolerate such high payments and neither should international payers,” stated Adam Russo, CEO of The Phia Group.  “We are here to help contain US costs, share what we are learning on the US side of our business, and find solutions that can be tailored for our international client partners. No one can match our expertise and experience in US cost-containment – regardless of where the client is domiciled – and so I am excited for the future.”

International capabilities

Phia International’s current services include catastrophic claims negotiations, and US cost containment consulting. Catastrophic claims negotiation is provided to address complex and high-cost claims in the US, delivering claim review and negotiation expertise to minimise exposure and maximise savings. Using expert strategies forged in the US, Phia International’s results are best-in-class and reliable. 

Phia International has consulting expertise in all facets of US cost containment, which can help clients explore ways to capitalise on existing resources while working to maximise the external options available today (PPO performance, claim editing, policy wording, reference-based pricing, bill review, benchmarking, and beyond). 

Lastly, vendor management can be difficult and so many offerings can all appear the same. Phia International can help with diagnosing vendor programs so that clients can maximise every conceivable opportunity to improve services and reduce costs.

All of this is backed by an organization that has, for more than two decades, been dominating cost containment in the US health benefits space; The Phia Group, LLC.

International Hospitals & Healthcare Interview with Jason Davis

Congratulations on the acquisition of JCDC by Phia Group LLC. Could you tell us a little about how your role will change and what you are most looking forward to as a result of this business move?

Thank you! Believe it or not, my role is very much the same as it was before because I was already working closely with The Phia Group as a consultant; I am dear friends with the owners and executive team, I helped build part of their systems, I trained some of their staff, and so I basically know every nook and cranny of their organisation. Like always, I oversee the performance and design all facets of cost containment activities, whether for International or US clients; the main difference is that I am now able to centralise and optimise my resource centers, which is a fancy way of saying I now can focus all my efforts into one cost containment delivery system. 

We’ve been witnessing a lot of turbulence in the realm of international healthcare of late. In your opinion, what are some of the most pressing issues facing the US healthcare industry at the present time?

On one hand, Covid-19 is the obvious choice, but on the other hand, the most pressing issue in the US continues to be the high cost of care (generally) and the crushing effect that the high-billed charges have on people. At the outset of the crisis, Covid-19 test costs ranged from US$30 to over $2,000, and even one provider billed nearly $11,000. Some industry groups are using the compassion generated in the context of Covid-19 crisis to try and end balance billing once and for all. I don’t think many truly realise how eye-wateringly ironic US healthcare has become; American health systems are wonderful healers, arguably the best in the world, but, at the same time, they are destroying the lives of millions of Americans with predatory and egregious billing practices. 

What are your thoughts on the new hospital pricing transparency ruling due to come into play in the US in 2021? 

To set the stage, let’s do a recap. In June of 2019, the president directed federal agencies to create and implement a price transparency rule. The final rule was released last November. It requires hospital systems to disclose the price discounts they have negotiated with insurers for a wide swath of procedures. This disclosure is intended to inform patients of their prospective costs before they are incurred, empowering patients to shop around for the best prices. Like most federal rules created through executive orders, this one was immediately challenged in court. This time, though, a federal court ruled against the hospital association, allowing the rule to stand. While hospital groups are appealing this ruling, it appears likely the rule will take effect as scheduled. It’s not often that the two major political parties in the US agree on any policy issues; but this issue, price transparency, enjoys major bipartisan support. So, even though a presidential election is looming, there’s a good chance that this rule will survive in some form. What do I personally think about this rule?  Maybe I am becoming cynical in my old age, and I always support more versus less information, and consumer engagement; but I don’t think this new transparency will change much. Candidly, we have seen models like this before, and they simply have not moved the needle … yet. 

From the perspective of someone working in the cost containment field, how have operations changed over the last year with the emergence of Covid-19?

Claim volumes are down across the industry and virtually everyone is feeling the pinch. I am thankful that despite this, our business continued to grow, because low claim volumes and less premium has seemingly led to more attention on innovative cost containment. New and existing clients are coming to us looking for real solutions, and status quo options are being scrutinised more closely (and are often found woefully lacking). Clients have even started sending us files that were previously negotiated by other vendors for rates that far exceeded the reasonable value of the services. We contacted the provider to explain the situation (that the client was not approving the agreement), and even many of the providers admitted that they were not surprised the agreement was now being challenged.   

While Covid-19 has had a drastic impact on the healthcare sphere, it has also boosted the implementation of tech assistance such as telehealth and remote access to healthcare. Do you think that this presents an opportunity for improved cost containment practises for both payers and providers going forward?

Absolutely. Our clients are looking at their total claim life cycle and looking to bolster cost containment efforts, aligning the right situations with the right outlet for healthcare delivery at a fair cost. 

You and your team obviously have a wealth of experience working in cost containment consulting; what do you think is one of the most important factors when it comes to negotiating settlements between payers and providers?

I have said it countless times publicly and in writing: the single most important factor for cost containment is changing the policy language and properly defining the reasonable value of services in the US. If I have clear policy wording, Phia International can explain the available benefits under the policy and offer to assign the benefits to the provider. People forget that just paying the benefits to a provider is a major consideration that can be exchanged with the provider on the condition that it will be accepted as payment in full. If not, one can at least negotiate based on a reasonable benchmark as defined in the policy versus working off charges that are unequivocally unreasonable; to negotiate any other way is to build a house on shifting sand. 

Thanks for your time Jason, we hope to see you at ITIC again very soon!

You are very welcome. Many thanks to ITIJ for all that you do to advance the international travel insurance industry!  ■