Best Practices: Is Your Point Solution on Point? 

Best Practices: Is Your Point Solution on Point?

In an era of rising healthcare costs, businesses, plan sponsors, and health plans are in constant pursuit of effective cost containment strategies. Simultaneously, venture capital firms are injecting billions into health and well-being vendors who promise to reduce healthcare expenses, enhance accessibility, and elevate health outcomes. This article serves as your guide, helping you make informed decisions when evaluating and implementing point solutions. It delves into various financial arrangements, their pros and cons, and factors to consider. 

Understanding Healthcare Point Solutions 

A healthcare point solution is designed to address specific business challenges, adding value to benefits programs by tackling cost, access, and care quality concerns. These solutions can target various medical conditions, such as diabetes, musculoskeletal issues, hypertension, cancer, or weight management. Often, they incorporate telehealth benefits with virtual counseling options. 

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Contract Options with Point Solution Vendors 

Before engaging a point solution vendor, it’s crucial to understand the contracting options available: 

1. Fee-for-Service 

This model involves reimbursing vendors based on a fee schedule for each member interaction. It’s commonly used for telemedicine and services like patient navigation and care management. 

2. Per Program Period or Per Case 

Vendors receive a flat fee for each member during a specific program period or defined case, such as a three-month behavioral health program with virtual visits and text-based support. 

3. Flat Monthly Payments 

This option includes: 

  • Per Member Per Month: Vendors receive a monthly fee for each eligible plan member, irrespective of service usage. 
  • Per Engaged Member Per Month: Used for condition-specific medical management solutions. 
  • Per Attributed Member Per Month: Common for condition-specific management, where vendors are paid for each eligible member meeting specific criteria. 

4. Performance Guarantees 

Contracts often include performance guarantees, which define desired clinical outcomes or minimum savings. These can mitigate financial risks and incentivize vendors to meet customer-defined metrics. 

Eight Key Questions to Ask 

Before implementing a healthcare point solution, consider these eight critical questions: 

  1. Why are you implementing a point solution? Define your primary goals to select the right solution and measure success. 
  1. How much can you expect to save? Be cautious about vendors’ claims and ask for specifics on cost savings mechanisms. 
  1. Should you narrow your target group of members? Consider engaging members who need the solution the most. 
  1. Will any services overlap? Avoid member confusion by managing overlapping services efficiently. 
  1. How will you monitor a vendor’s cost and quality of care? Define metrics to measure vendor performance. 
  1. What are your data requirements? Ensure you receive the necessary data for performance evaluation. 
  1. Should you expect short or long-term savings? Understand the timeline for realizing savings. 
  1. How will you measure the vendor’s impact? Define performance targets and measurement methodology. 

Know Your Population and Keep It Simple 

Understanding your member population is as crucial as selecting the right solution. Ensure that members are willing to engage with the solution to maximize its effectiveness. Additionally, keep your approach simple by limiting the number of point solutions and communicating clearly with your members. 

Factoring in Third-Party Administrator (TPA) Arrangements 

Consider the capabilities of your third-party administrator (TPA) when implementing point solutions. Ensure effective communication and coordination between TPAs and point solution vendors to streamline benefits integration. 

Next Steps for Plan Sponsors and Health Plans 

As the point solutions landscape continues to evolve, careful consideration and planning are essential. Utilize pilot programs to test solutions’ effectiveness and engage an independent consultant to assess program impacts and performance. 


Selecting the right solution can lead to significant cost savings and improved health outcomes for your organization and its members. By asking the right questions and understanding the intricacies of each arrangement, you can make informed decisions that benefit both your bottom line and the well-being of your members. 

Unique FAQs 

1. Why are point solutions essential for healthcare cost containment? 

Point solutions help address specific healthcare challenges, reducing costs and improving care quality. 

2. What are the different contract options with point solution vendors? 

Contract options include fee-for-service, per program period or per case, flat monthly payments, and performance guarantees. 

3. How can businesses ensure maximum effectiveness with point solutions? 

Understanding your member population and keeping the approach simple are essential for success. 

4. Why is it crucial to factor in Third-Party Administrator (TPA) arrangements? 

Effective coordination between TPAs and point solution vendors is vital to streamline benefits integration. 

5. What are the next steps for businesses in implementing point solutions? 

Careful planning, pilot programs, and independent consultant assessments are key to successful implementation. 


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