Diversified Case Study

Diversified Group is a third-party administrator that helps employers manage the current risks and future costs of their health care plans by utilizing self-funding as their most cost effective and transparent health insurance option.

In 2006, Diversified was finding it increasingly more difficult to match competitor pricing. Due to their contract terms, the company was unable to leverage long-term control of costs. Every year drug prices rose, but their flat-dollar copay stayed the same. With their contract renewal drawing near, Diversified partnered with Arxcel to guide them through the bidding process and ensure market-based pricing moving forward.

Arxcel gave Diversified the keys to drive the contracting process. Diversified’s previous contract was littered with optics; phrases, definitions and calculations that were advantageous for the pharmacy benefits manager, but not Diversified. Arxcel proactively defined the terms of the new contract, clearing all optics from the terms. To ensure Diversified was privy to market-based pricing, Arxcel included percentage copay in the new contract, allowing Diversified’s plan to keep pace with drug inflation.

Arxcel helped Diversified to offer plan design recommendations to its client companies, recommending programs that promote quality of care as well as cost-savings. Arxcel also facilitated programs around specialty drugs, adjusting member's copay to mimic the copay assistance program, resulting in money saved for both the employer and patient.

Arxcel delivered a contract that augmented and brought value to Diversified’s services while ensuring integration between the drug and medical costs. Arxcel negotiated a 15 percent decrease in overall pricing, helping Diversified meet their competitive pricing goal and offer some of the most competitive contracts in the market.

Arxcel’s well-written contracts allowed Diversified to react promptly and confidently to inquiries from prospective and existing clients. Since partnering with Arxcel, Diversified has experienced a 3.5 percent increase in client retention.

“Even though we may not be the largest company out there, Arxcel helps us play like one.”

- Brooks Goodison, President and Principal Partner, Diversified Group