ITIC Americas 2025 | Cost containment in the US versus in Latin America

The ITIJ team have been reporting live from ITIC Americas in Miami this week (March 2025) sharing the discussions that took place at the conference. Read all reports

Dr Andrés Sánchez Campos, Director of Case Management and Networks LatAm, Global Excel Management

Dr Sánchez Campos’ presentation concentrated on understanding cost containment in Latin America. He said that to successfully contain costs in LatAm, insurers and third-party administrators (TPAs) must proactively manage provider relationships, negotiate competitive pricing, and implement strong auditing frameworks. He also referred to the healthcare inflation trends from WTW, and said that Latin America is at 10.1%, compared with Mexico at 14.9%. 

Dr Sánchez Campos said that LatAm’s top medical destinations – Mexico, Costa Rica, Colombia and Brazil – are driving medical inflation, and said that key cost drivers in high-demand locations are that tourism increases hospital demand, foreign patients pay more, and there is a shortage of specialised doctors. 

He said that provider networks in LatAm should negotiate with hospitals in tourist-heavy locations, have pre-agreed pricing models, and establish secondary provider networks for cost efficiency. In order to mitigate rising costs, he advised having strategic negotiations, utilising a cost-efficient provider network, and conducting ongoing audits. He added that the key benefits of a strategic provider network include pre-negotiated pricing, preferred provider partnerships, and cost efficiency through direct contracts. 

Unlike structured markets, LatAm lacks standard pricing models, making cost containment a strategic necessity, Dr Sánchez Campos said. He added that the key market challenges are that there is no standardised pricing, the fee-for-service model dominates, and there are regulatory inconsistencies. He said it matters because insurers and TPAs must actively negotiate rates and audit claims to ensure fairness. 

Dr Sánchez Campos said that auditing is not just about cost control – it’s about fairness, accuracy, and avoiding unnecessary payments – and added that it’s critical because overbilling is common, saying: “There’s a lack of cost transparency and often there are hidden administrative fees.” 

He said TPAs and insurers can optimise audits by using automated claim screening, on-site audits, and trusted provider networks.

Dr Sánchez Campos concluded his presentation by saying the next steps for insurers and TPAs are to strengthen relationships with providers and develop targeted cost-containment strategies for high-demand markets. 

Tracey Badger, Vice President – Cost Containment, Global Excel Management

Badger started her presentation by saying that she would cover healthcare inflation, why it’s so expensive, and some strategies around cost. 

She said that reports from WTW, Aon and Mercer Marsh Benefits (MMB) have slightly different statistics on healthcare inflation trends

WTW has global inflation at 10.4%, AON has it at 10%, and MMB at 10.9%. LatAm and the Caribbean again has slight differences at 10.1% from WTW, 10.7% Aon, and 10.4% MMB. Reports about Asia Pacific have some of the biggest differences with 12.3% from WTW, 11.1% from Aon, and 13% from MMB. Europe is at 9.3% (WTW), 8.9% (Aon), and 10.4% from MMB. The Middle East and Africa have 12.1% (WTW), 15.5% (Aon) and 10.7 (MMB). North America medical inflation is reported at 8.7% from WTW and 8.8% from Aon. 

Badger then asked why is the US so expensive? She cited answers such as fraud, labour shortages, and investment in new technology. 

She pointed out that healthcare risk management is so important, and that it’s vital to look at risk as it prevents costs by starting at the start; it mitigates costs by managing the treatment phase, and contains costs by a wide range of repricing tools.

Badger then spoke about cost containment strategies and said that there are five aspects to consider: directing care, benchmarking, contracted relationships, cost-based agreements and detailed claim reviews.

She finished her presentation with a quote from Benjamin Franklin: “An investment in knowledge always pays the best interest.”

Peter Nardi, Senior Contract Manager, Cleveland Clinic

Nardi’s session covered a hospital’s perspective on US medical inflation, and he started by talking about key inflation drivers which are labour, access, admin burden and medication. He said that since December 2019, the Hospital and Related Services inflation rate in the US has increased from 2.9% to 4%. He also pointed out that the National Council of State Boards of Nursing figures reveal that one in five registered nurses have left or will leave the field by 2027. 

Nardi went on to talk about price transparency, saying that stricter Centers for Medicare & Medicaid Services (CMS) regulations aim to create a greater degree of transparency on a hospital’s machine-readable file (MRF):

• Direct links to a hospital’s MRF must be included in a footer on the homepage
• Formats must be in CSV or JSON
• Negotiated charges must have an associated reimbursement method and must identify whether the data element is a dollar amount or percentage
• Items on the MRF must include a general description, and whether it is inpatient or outpatient
• Each item must list the associated revenue code, along with CPT, DRG, or NDC.

He added that despite non-compliance, CMS has only brought actions against 17 hospitals since June 2022.
Nardi then went on to speak about using price transparency data. He gave an example of a cervical spinal fusion without CC/MCC (complications and comorbidities).

“Hospitals and physicians continue to embrace technology, which can lower costs for insurance companies and patients,” Nardi said. He added that uses include artificial intelligence (AI), robotic surgery, and CAR T-cell therapy. 

To conclude, Nardi spoke about having a holistic approach, which involves looking at total costs, local support, concierge services, quality treatment and contractual payments. This will all give you the final total cost.