SBG’s Group Purchasing Results

Participating self-funded member companies average 70 percent hospital savings when comparing actual charges to agreed rates. The average Coalition member’s return on investment for network users during 2012 was $245 (Employers saved $245 in hospital charges for every dollar paid to Coalition).

All of SBG’s members are well below the national average with one of SBG’s member’s monthly plan medical costs of $217. Compare this to the Kaiser Family Foundation’s reported average monthly of $415.

SBG has been very successful in negotiating rates and fees that have protected our members from the double digit increases experienced by other employers.


In this chart, the orange line shows SBG’s much lower percentage increases, compared to national rates, for the last 10 years. The shaded regions show cumulative increases over that same timeframe.


This success extends into all aspects of the health plan. SBG participating members consistently pay less for hospital services.

Payment for laboratory services is far below what physicians typically charge for laboratory services in this area.


Contract Features:

  1. Hospital Inpatient:
    • Admission charges are based on DRG case rates.
    • Admissions outlier protects against large cases.
  2. Hospital Outpatient Surgery:
    • Ambulatory surgery rates are based on APC case rates.
    • Employee expenses based on lower of billed charges or agreed rate.
    • Observation included in case rate.
  3. Hospital Outpatient Services:
    • Laboratory services available through couriers, draw sites, or the hospitals.
    • MRI and CAT scan services are based on a flat dollar per case.
  4. Physician Fees:
    • Service charges based on a negotiated fee schedule.
    • Employee expenses based on lower of billed charges or agreed rate.
    • Services not on the fee scheduled are re-priced with a set discount.
    • No balance billing for covered services.
  5. General:
    • Hospital fees are firm for one year.
    • Annual hospital increases based on achievement of performance measures.
    • Health System contracts are multi-year agreements.
    • RFPs are used to select health systems.

Financial agreements are proprietary and are only available for review by perspective employers on a confidential basis.