Specialty care makes up 50% of your spend. But you might not think of it as a category—or have a plan to address it as one. Dickon Waterfield, President at Lantern, chatted with MedCity News about why specialty care should be in the spotlight for benefits leaders.

“Three things to always think about,” Waterfield explained. “One is what’s happening to these members at this moment in time? They’ve just been diagnosed with cancer, they need to have major surgery or have an infusion for a chronic condition. Those are pretty critical moments in their lives.

Two, it’s 50% of total spend: surgery, cancer and infusions. That is a huge cost driver for employers, and yet it’s only a small percentage of the total population,” he continued.

“Three, it’s actually impactable. You can really, truly lower the cost of care by focusing on these particular items.”

More Than Traditional Navigation: A New Approach to Specialty Care

Navigating employees to quality care helps lower costs, but as Marissa Plescia of MedCity News pointed out, navigation has been a tough business model.

One benefit of a specialty care solution is that instead of trying to reach 50% of your population, like with chronic disease programs, you can specifically target those managing complex care such as cancer and surgery—generally only 3-5% of your population.

And while care navigation is part of Lantern’s program, it’s not the full solution.

“We’re actually driving people to our own proprietary network where we select the doctors that improve outcomes,” said Waterfield. “We can dramatically lower the cost of care because we’ve negotiated specific rates with the providers to reduce costs by north of 50%. So that has a really meaningful impact in terms of improving affordability for the member, but also for the plan sponsor.”

The Three-Pillar ROI Strategy for Specialty Care

To truly lower healthcare costs, benefits leaders need a specialty care solution that delivers ROI on three key fronts:

1. Eliminating Unnecessary Care
“We help people avoid unnecessary care they don’t need. So in case of surgery, roughly 30% of people have unnecessary spinal joint procedures. We help them avoid that,” Waterfield said. “This not only reduces costs but also improves member outcomes by preventing potentially harmful procedures.”

2. Reducing Complications Through Quality Care
“By getting people to the best surgeons, we can then avoid complications that significantly lower cost because you don’t have to manage the complication. It’s also a much better outcome for the member,” he said.

3. Negotiating Better Unit Costs for Specialty Care
“We’re lowering the actual unit cost,” Waterfield said.“By negotiating those proprietary contracts, we contracted between 110 to 130% of Medicare versus the broad carrier network, which is 250 to 300% of Medicare.” The impact is dramatic: “We’ll bring a knee replacement from $40,000 down to roughly $20,000.”

The result? A powerful ROI formula that delivers for clients. As Waterfield noted, “Those three items really drive that return on investment.”

See our impact in action: Read how Greystar saved $8M by rethinking specialty care