Provider networks and prior authorization requirements may be levers "available to health plans to manage care in ways that might dissuade people from getting treatment," researcher says.
Despite much more insurance coverage than in the past, patients with behavioral health needs are not getting the treatment they need, according to a recent study.
The Patient Protection and Affordable Care Act (PPACA) was supposed to improve access to mental health services by making sure those in need had the insurance coverage to pay for treatment. But there are still barriers that have not been overcome by simply having insurance coverage.
Researchers from Brandeis University and Harvard Medical School analyzed National Survey on Drug Use and Health data from 2005 to 2014 to estimate how many people were likely to face "serious psychological distress," a specific level of mental health need that the Centers for Disease Control and Prevention estimates affects about 3.3% of non-institutionalized Americans.
The researchers used that 3.3% figure as a general estimate of how many people need mental illness access care. Then then they measured how many people actually received mental healthcare.
Even a single inpatient, outpatient, or pharmacy visit was considered mental healthcare.
The findings were published in Health Affairs this month.
Better Access Seen, But Not for All
There was some improvement in access to behavioral healthcare after the ACA was enacted in 2010, but only for certain groups, says lead author Timothy Creedon, a PhD candidate at the Heller School for Social Policy and Management at Brandeis University.
Racial divisions were significant, with whites the only racial group in which a majority of people needing mental healthcare received treatment. Whites with mental health needs also saw access to mental health services grow significantly, from 50% to 55% after ACA.
For Hispanics and Asians, access to mental healthcare improved after 2010, but only at about the same rate it was growing before the law came into effect.
Access for blacks did not change at all. Across all racial groups, less than half of people with serious psychological distress get the treatment they need, the authors concluded.
How can that be if more people have insurance coverage now?
Creedon says the problem appears to be partly the result of consumers not knowing about or understanding the coverage they have.
"When we ask people with private insurance, as many as 25% to 30% of people will say they don't know," Creedon says.
"That suggests that simply having the coverage doesn't improve anything unless the person knows and understands how to take advantage of the services available."
Treatment Limits a Barrier
Although health plans seem to be complying with the ACA requirements and the Mental Health Parity and Addiction Equity Act of 2008, Creedon says non-quantifiable treatment limits still are getting in the way of treatment for some insureds.
"Provider networks, prior authorization, and things like that may still be levers that are available to health plans to manage care in ways that might dissuade people from getting treatment," Creedon says.
"We also have problems with shortages and distribution of mental health providers, who tend to be located in urban centers and not so much in rural areas. The workforce in mental [health] tends to be relatively homogenous and not necessarily reflective of the demographics of the people seeking treatment, and that can be a deterrence."
Creedon also notes that psychiatrists are the physicians least likely to accept insurance.
He notes, however, that the research period came before the Medicaid expansion and state-based health insurance exchanges, and both may have improved access to mental healthcare, he says.
Health plans also are recognizing the disparity in coverage and treatment, Creedon says.
"We're seeing some health plans offer more case management and integrated care, which can help people get access to mental health [services] through their primary care office, and some plans are offering more reimbursement for that kind of thing," Creedon says.
"I think if we see more financial encouragement of integration, that will be one way to get needed care to people."
Aetna and Texas Health Resources each will own a 50% stake in the newly formed health plan, which will offer coverage in 14 counties in North Texas.
Apparently pleased with its first foray into jointly owning a health plan, Aetna is creating its second such venture with Texas Health Resources, one of the largest faith-based, nonprofit health systems in the United States.
Based in Arlington, Texas Health Resources is the largest in North Texas in terms of inpatients and outpatients served. It had nearly 162,000 inpatient stays and more than 1.5 million outpatient encounters (excluding physician office visits) in North Texas last year.
Aetna and Texas Health Resources together announced the plan last month, saying they intend to create a jointly owned health plan company that will focus on improving quality, affordability, and the overall consumer experience.
The announcement came immediately after Texas Health Resources added another hospital to its network in North Texas. Just before that, the health system added a network of 27 freestanding First Choice Emergency Rooms to its system in North Texas.
Aetna and Texas Health Resources each will own a 50% stake in the newly formed company, which will offer coverage in 14 North Texas counties.
Aetna already covers about 700,000 commercial members in that area and intends to transition some of them into the new joint venture. The rest will be able to continue with plans offered directly by Aetna, but with a broader network stemming from the joint venture.
The joint health plan will launch Jan. 1, 2017, if the Texas Department of Insurance approves the move.
The partnership between Aetna and Texas Health is the first of its kind in North Texas to fully align the incentives and capabilities of a national insurer and major health system, but Aetna has tried this arrangement before.
First Came Inova
The insurer aligned with Inova Health System in 2013 to launch Innovation Health in northern Virginia, providing care to 189,000. Aetna has reported that the Innovation Health plan lowered overall healthcare costs, and the insurer projects that it will move 75% of its contracts to value-based care models by 2020.
The move is consistent with the trend of insurance companies offering new products in an attempt to provide better price and quality.
Michael Nelson, Aetna's market president for Texas, says the two groups will be able to streamline processes and eliminate inefficiencies, leading to healthcare savings in the form of more affordable premiums.
Barclay E. Berdan, FACHE, chief executive officer of Texas Health Resources, says the partnership is a response to the changing landscape of healthcare, with increasing costs and quality pressures creating demand from employers and consumers for new healthcare options.
"This partnership aligns our two organizations' commitment to build more sustainable value-based models of care, which will help to deliver better outcomes and lower costs, while providing an unmatched patient and provider experience," Berdan said in a statement.
"It's what consumers expect of us in this new economy and, frankly, what we expect of ourselves."
Texas Health Resources has 27 acute care, transitional, rehabilitation, and short stay hospitals, along with more than more than 5,500 physicians with active staff privileges. The affiliated Texas Health Physicians Group has more than 540 physicians and more than 260 physician assistants and nurse practitioners. The health network had $4.06 billion in total operating revenue for fiscal year 2014.
The healthcare industry has only partially adopted a consumer-focused approach to selling its services and "there is a competitive need for providers to get transparency right, in terms of what information to present and through which channels," says one industry analyst.
Driven in part by high deductibles, Americans are increasingly looking at their healthcare choices in the same way they shop for other commodities, comparing prices and quality to get the most for their money.
Hospitals, health systems, and insurers are responding with more transparency and price estimation tools to help the consumer. So why aren't more consumers using those resources?
Part of the answer lies in how the healthcare community has only partially adopted the consumer approach to selling its services, says Jean-Pierre Stephan, head of customer relationship management at Accenture, the multinational consulting company with a strong presence in healthcare. If healthcare organizations are going to use a more traditional business approach by providing prices and quality information, they have to fully embrace it and solicit participation, Stephan says.
"There has to be a trigger for the consumer to change behavior," Stephan explains. "Just having information out there, thinking patients will come to the information because you're transparent and it's there, is not how other industries have solved consumer behavior problems. That is why we're seeing low adoption rates with these solutions."
That view is supported by an analysis of a large national health insurance plan database by researchers from Harvard T.H. Chan School of Public Health, which shows that only 3.5% of those who had access to Aetna's pricing tool, called the "Member Payment Estimator," used it in between 2011 and 2012.
Though participation probably has increased in the ensuing years, the figure still would be quite low today, says lead author Anna Sinaiko, PhD, research scientist in the Department of Health Policy and Management.
Sinaiko points out, however, that a price estimating tool will be useful only to a subset of the overall population that has access to it. Only patients who are planning for a healthcare service that has pricing information available will use the tool. That subset is much higher than 3.5% of all Aetna customers, so the figure still indicates low participation, she says. The Aetna tool covers more than 600 procedure bundles.
The researchers found that colonoscopies, mammograms, and childbirth services are the most searched-for medical services in cost estimators. Other top searched-for services in the study included MRIs, vasectomies, physician office visits, and other non-emergency services, according to a recent study in Health Affairs.
Profile of a Price Shopper
Most of the healthcare price information people sought was for "shoppable" services, the type that patients can plan for ahead of time, such as preventive screenings or outpatient procedures such as knee replacements, tonsillectomies, or hernia repair.
Most who used the price transparency tool were in the 19 to 34 age range, healthier than the general population, and had higher annual deductible spending than those Aetna members who did not use the estimator. Women used the tool more than men.
"Engaging patients in the use of this information is an ongoing process" Sinaiko says. "More effort is needed to engage patients, particularly those with high deductibles who could make the most use of the information."
Sinaiko notes that her previous research on consumerism in healthcare indicates a strong desire among patients to have cost and quality information available to them, with a survey showing that half of people who had recently received care wanted access to that data.
But only 3% said they actually had shopped for a good price before their care. The explanation must be that there is a disconnect between the patient who wants information and the healthcare entity providing it, Sinaiko says. "Developing strategies to deliver salient price information to our patients is really the next step in the process."
Online Shoppers' Perception of Bias
Use of healthcare consumer shopping resources varies significantly among different demographic groups, Stephan and Sinaiko say. The highest usage comes from younger consumers with a high digital profile, those who regularly use social media and online resources.
These "digital consumers" typically are younger consumers of the Millennial generation, which means they are healthier and have some of the highest deductibles. They have expectations and attitudes that may seem counterintuitive to the healthcare leaders designing shopping resources, Stephan says.
For instance, consumers most comfortable shopping online and using digital resources are the most skeptical. In general, consumers are less trusting of cost and quality information provided by insurers, thinking they're being steered towards what's best for the company rather than the patient, Stephan says.
"There is this sense that the information being published is biased," Stephan says. "Among all healthcare consumers, the trend is moving toward less thinking that the information is biased. But among digital consumers, those who are using these resources the most, the trend is inverse. They are moving more toward thinking it is biased."
In addition, digital consumers expect as much personal interaction with clinicians as older, more traditional consumers. Their comfort in using online resources does not mean they see them as an alternative to in-person or telephone communication, Stephan says.
Consumers also expect to see patient reviews of the services they received, just as they rely on posted reviews on other websites for products, restaurants, and hotels, he notes.
Transparency and serving consumers' concerns could affect consumer loyalty and the bottom line, Stephan suggests. Healthcare consumers already are known to switch providers more than in other industries, and switching is expected to become easier in the future, he says.
"There is a competitive need for providers to get transparency right, in terms of what information to present and through which channels," Stephan says. "Consumers who get the information they want, in the way they want it, are less likely to take their business elsewhere just for a small cost savings. When people feel that they can easily get information they can trust, that has a value to them."
It’s real enough to drive changes in how the healthcare industry communicates costs and quality, but still a long way from true consumer shopping.
Consumerism has been making inroads into the healthcare industry for at least a decade, with patients increasingly acting like consumers who have a choice in their healthcare options, trying to make the best decisions for quality and cost just as they do with any other commodity. The trend has been accelerated by the Patient Protection and Affordable Care Act, which left many consumers with large deductibles that put more pressure on them to find the most cost-effective care for the dollars coming out of their own pockets.
Just a few years ago, patients seeking information about a doctor or hospital were able to find only the most basic data, leaving them to base their treatment decisions on the few factors they could mostly understand—their insurance coverage and the availability of the care they needed. Now many of those patients are able to access much more detailed information about important factors such as a physician'sexperience with a particular procedure or a hospital's complication and readmission rates.
Patients are finding, however, that there are limits to how much they can play the savvy consumer. Despite growing access to quality metrics and hospital rankings, there still are holes in that data that can make it difficult to discern meaningful differences among providers; and even if patients have adequate information, they may be unable to choose freely because of health plan restrictions and other limitations.
However, the trend toward consumerism has advanced far beyond where it was just a few years ago, and the healthcare industry is responding with outreach and initiatives intended to help patients in their quest for value.
At the same time, consumers and healthcare leaders are both realizing that making healthcare choices is not the same as finding the best deal on a television set—and it never will be. Other concerns and motivations are in play when it comes to healthcare, starting with the fact that the patient often is making the decision in a time of stress and urgent need. Also, choosing one physician or hospital usually is not enough; the patient has to make choices based in part on which physicians, specialists, and hospitals work together and how they will work with the patient's insurance coverage. And unlike most consumer choices, the human connection between the patient and the provider can hold great sway over a patient's decision.
The search for cost and quality information
Research by Healthgrades, a Denver-based online resource for consumers seeking information about physicians and hospitals, indicates significant overlap between what consumers say is most valuable when selecting a physician and what physicians want to know when referring a patient to a specialist. Both consumers and physicians say experience-related information is most important, especially for complex conditions and unique cases.
When choosing a hospital, quality measures such as complications and mortality rates are most important in complex cases. Consumers take note of the "patient satisfaction" ratings of a physician or hospital more in basic, everyday situations such as selecting a primary care provider than they do in more complex scenarios such as finding the best surgeon for the procedure they need.
Consumers are twice as likely to select a specialist, such as an OB-GYN or an orthopedic surgeon, when they have access to three objective metrics about that specialist—experience, hospital quality, and patient satisfaction, according to the Healthgrades research. In primary care, however, consumers are just 1.26 times more likely to choose a doctor when they can access that data. Additionally, when presented with information about physician experience and related hospital quality, 85% would select a different doctor than the one they chose before getting that information.
That may be because consumers see so little transparency that when they do, the very fact that they have access to information works to the benefit of that healthcare provider. Patients at times struggle to understand their healthcare choices because the healthcare industry is still mostly opaque, says Roger C. Holstein, who spoke to HealthLeaders for this article as CEO of Healthgrades. He has since become vice chairman of Healthgrades' board of directors and has returned to Vestar Capital Partners as managing director.
Some large health systems are responding rapidly to the need for more transparency and recognizing that embracing transparency as a core principle can differentiate them from competitors, he says. "The health systems rapidly adopting transparency are reaping the benefits because consumers are more likely to trust those who expose more content than those who don't."
Trust is the touchstone of consumerism and the way healthcare organizations respond to it, says Mark P. Herzog, FACHE, president and CEO of Holy Family Memorial in Manitowoc, Wisconsin. With high deductibles putting more of their own money on the line, patients are looking for data and healthcare professionals they can trust to provide the most cost-effective care. The 62-staffed-bed general medical and surgical hospital, along with its network of clinics, pharmacies, and other facilities, has more experience than most in dealing with high deductibles, Herzog says, in part because the Manitowoc community has many family-owned businesses and they have been more innovative in designing their health plans than larger employers.
"We've been in a high-deductible market since 2008, so we are much further along in learning what that means for us and for patients," he says. "Ninety percent or more of our insured population has a high-deductible plan. The typical family deductible in our market is about $8,000, and we have more than a handful of $14,000 deductibles in our community."
Those figures prompted Holy Family Memorial to address consumerism earlier than most hospitals. One of the first signs of the high-deductible impact was suppressed utilization of healthcare—some appropriate, but much of it may be inappropriate, Herzog says.
Not only were patients avoiding high-cost care, but they were also avoiding inexpensive or fully reimbursed care because they didn't want to risk having to pay for follow-up treatment. For instance, a false positive mammogram, which happens about 15% of the time, would necessitate an office visit that the patient would pay for, so some women elected to forgo the mammogram, he says.
High deductibles force more dialogue with patients, and cost is almost always part of dialogue. That discussion changes the course of treatment about a quarter of the time, he notes.
"Providers have had to become more aware of what the cost of services are," Herzog says. "For the services that they commonly order, our providers are pretty aware of the costs and can discuss treatment options with the patient. Patients will ask directly about the cost and whether this test or therapy is really necessary, so our providers have to be able to discuss that instead of passing them on to someone else."
The right setting for a patient's care
Responding to that consumer move by the patient, Holy Family Memorial adopted a corporate philosophy called Right Care, striving to provide each patient the right care in the right setting, with the right outcome. The right setting is the one that presents the patient with the lowest financial risk and the lowest physical risk, Herzog explains.
The hospital also has worked to provide more cost information directly to the consumer. For 10 years, the hospital has offered price estimates that outline the patient's out-of-pocket expense for almost all procedures. When Herzog recently underwent knee surgery, he didn't specifically ask for the cost estimate but found one in his mailbox a week before the procedure, detailing all the costs and the out-of-pocket expense from his health plan.
"A strict focus on cutting costs and suppressing utilization purely driven by insurers can be seen as bad, mostly because of the way it is being forced on consumers and providers, but I think it can start a healthy dialogue," Herzog says. "We've been trying to help those we serve by intentionally lowering utilization of expensive hospital services for over a decade now, and it's been not good for hospital finances. But because our mission statement is to serve communities and not our own corporation, we decided to do this because it's the right thing for the community."
The efforts to lower utilization costs at Holy Family Memorial has resulted in lowering inpatient admissions by 45% in the past decade.
"We saw a 20% increase in clinic visits during the same time frame, which, when correlated with the decrease in admissions, provides some indication that our efforts to shift patients from hospital to clinic is working," Herzog says.
"There is one other competing hospital which has not embraced a community-focused value philosophy like Holy Family Memorial has. In fact, if Holy Family Memorial had been the only provider in the county, the increase in hospital bills individuals, government, businesses, and insurers received would have increased only 22%," Herzog says. "If all hospital services in our county used our Right Care approach, it would have avoided more than $90 million in hospital charges over the past decade."
Herzog notes that the hospital's Right Care value focus directly caused group health insurance premiums in his county over the same time period to increase 38% less than neighboring Green Bay, reflecting how hospitals and doctors can improve the economic environment.
Also, Holy Family Memorial's bad debt (as a percent of gross revenue for the hospital—not consolidated), decreased from 1.47% in 2004 to 1.13% in 2014.
Herzog notes that the commitment to serving the community has forced Holy Family Memorial to transform its delivery system and cost structure considerably faster than if it had stayed in the traditional volume-driven mindset.
Herzog's hospital also formed the Consumer Transparency Theme Team in January 2015, responsible for making Holy Family Memorial as transparent as possible so that the patient knows what to expect from the entire experience. That means providing information on not just the cost, but also issues such as how the patient can expect to feel during and after a procedure or test, and who will be calling to follow up after discharge. The transparency team also works to provide quality information to patients in a form they can understand.
"Very few people can make use of the quality data that is out there because it is written from a provider or regulator point of view. It just doesn't resonate with the average citizen," Herzog says. "This team works to translate all the healthcare gobbledygook about healthcare costs, quality, and outcomes into the way two women at the hairdresser would talk about it, or two guys over a beer and a football game."
Holy Family Memorial also empowers the consumer by providing direct access to scheduling lab tests, therapy, and other care. The hospital's direct-access lab testing, for instance, allows the patient to schedule a lab test online without a physician referral, with results mailed the next day. The website lists the cost of 73 available lab tests.
The hospital also is working to accommodate patients' schedules, rather than the traditional approach that puts the convenience of the hospital first. Clinic hours were extended, e-visits were made available online, and Holy Family Memorial also implemented same-day appointments at its clinics.
The overall impact of consumerism is a positive one for the healthcare industry, Herzog says. "My greatest concern is that while the healthcare system is changing, albeit at a glacial pace, employers are struggling to make sense of this shift to consumerism," he says. "Employers rushing to high deductibles often give little or no help to the employee about how to appropriately access healthcare in this new environment."
More impact on outpatient services than inpatient
Consumerism appears to have more impact on outpatient services than inpatient care, says Mark Bogen, senior vice president of finance and chief financial officer at South Nassau Communities Hospital, a 400-staffed-bed acute care facility in Oceanside, New York. Patients still rely on their physicians to refer them to the appropriate hospital and generally don't question that choice unless the facility is out of network. It's only at that point that most patients will speak up and ask about an in-network alternative, he says.
"People are becoming much more savvy about the ultimate financial responsibility and the high deductibles, and it's the outpatient choices where they put that information to use," Bogen says. "We are certainly seeing the impact of that here on Long Island, with patients moving away from hospital-based outpatient ambulatory services to our freestanding counterparts."
South Nassau's efforts to follow patient trends in the past few years actually have backfired because of the move to consumerism, he says. With all the experts predicting that hospital admissions would decrease as patients gravitated more toward ambulatory care, South Nassau negotiated managed care contracts that would take advantage of that move with high-margin ambulatory care fees.
"What has happened is that we have substantially outpriced ourselves in the market, in relation to freestanding, primarily physician-owned and -operated providers of ambulatory care," Bogen explains. "And now insurance carriers have put in benefit designs that penalize recipients who prefer to use hospital-based ambulatory services. So the quandary we have in terms of redoing our managed care rate structure is that we could bring down our rates, but if the benefit design remains to penalize those using our facilities, we aren't accomplishing anything."
The insurers have to give a little if the hospital lowers its rates, so South Nassau is working with insurance companies to develop shared savings relationships that would soften the impact of patients continuing to move to freestanding ambulatory care. The hospital would share in the savings generated by the managed care plan patients choosing more cost-effective care in freestanding facilities, helping to compensate for the hospital's loss in revenue. Talks also are underway to establish a "skinny network" in which the insurer agrees to exempt South Nassau from the high deductibles that patients otherwise would pay when choosing the hospital over a freestanding facility.
Threats from urgent care, drugstore clinics
The damage from lost patients may be mitigated by the glut of urgent care centers on Long Island, which was spurred by the constant search for more cost-effective care outside the hospital. With a new one popping up in seemingly any vacant space, South Nassau leaders initially saw them as formidable competition that promised to save managed care providers money over patients going to a hospital emergency department, so the insurers were willing to pay physicians more than the standard private practice fee schedule. That led many local physicians to sign on with the urgent care centers, which left the community with fewer primary care physicians.
"So when they couldn't find a primary care doctor, people ended up using the urgent care as their primary care," Bogen explains. "The insurers end up paying more for the patient to see the doctor in an urgent care setting than if that doctor was available for a regular primary care visit. Now we're seeing the insurers go back to paying the primary care practice rate, and many of the urgent care operations can't sustain themselves on that."
As that threat recedes, another serious challenge for South Nassau is the CVS pharmacy directly across the street. CVS Health—which reported 2014 net revenues of $139 billion, and net operating profit of $8.8 billion—can undercut the hospital on prices for basic services at the chain's Minute Clinics because it is willing to lose money on a flu shot if it means getting a customer in the door to buy retail goods and use the pharmacy, Bogen says. The idea of setting up a similar clinic has crossed his mind, but Bogen notes that larger healthcare systems have tried that and ended up closing or subleasing the clinics because they were not profitable.
South Nassau also has gone to social media to slow the loss of patients seeking a better price. Realizing that, although it had a good Web presence, it wasn't very active on social media, hospital leaders brought in a new hire at the senior vice president level to focus on improving the hospital's exposure on Facebook, Twitter, and other social media.
During 2015, the hospital made a relatively small investment in a Facebook advertising campaign that paid big dividends in its ability to reach a significantly greater core audience. By the end of 2014, the hospital had collected about 970 "likes" for its page, and through 2015, that number swelled to 10,000 likes. This dramatically increased its engagement and reach, Bogen says, with weekly total reach skyrocketing from 26,000 to more than 70,000. The campaign was instrumental in developing awareness as the hospital launched a new branding campaign in 2015 with newspaper, cable, and spot TV. Of particular focus was generating original and organic content on an almost-daily basis, which has been key to effectively engaging the audience.
"We increased the number of social media administrators from within the hospital who could post content directly to our social media sites to aid in content generation and also be additional sets of eyes and ears," Bogen explains.
Using similar means, the hospital also grew a specialty Facebook site for its urgent care and freestanding emergency department, located in Long Beach, New York, about 5 miles from the hospital's home campus. Participation grew from just under 500 likes to more than 6,500 in that same year. When the hospital changed the service platform at that location from urgent care to emergency care, that growth gave the hospital an easy and inexpensive way to reach and notify interested parties in the market.
Using an integrated campaign of social media, website promotion, newspaper, radio, postcard mailing, beach flyover banners, and press conferences, the center doubled its patient volume in the first month and has continued to grow steadily.
South Nassau also increased its marketing budget, almost doubling in two years how much it spends on quality- and outcomes-based advertising. The hospital also is revamping its website to include more patient interactivity and to make more quality and cost information available. Previously the website was managed by a single administrator who could not keep up with constant updates, so now department managers have access to the site and are responsible for updating their information.
Different levels of consumerism across country
Regional differences can affect how much patients are moving toward consumerism, and how healthcare entities are responding. In areas where people have not been hit as hard with high deductibles and restrictive health plans, costs probably won't be the paramount issue for most patients, says Kimberly Boynton, president and CEO of Crouse Hospital, a 400-staffed-bed general medical and surgical hospital in Syracuse, New York.
Patients are asking more questions and seeing more information online about providers and suggested treatment, but their actual decisions usually are not based on price, she says. That may be due in part to the fact that the Syracuse market is behind the curve regarding health plans and high deductibles, with many employers maintaining their traditional plans. But even the most motivated consumer will find it difficult to obtain the information needed to truly price shop among healthcare options.
"With all that New York State regulates, I can't believe they haven't made us post our prices yet," she says. "I think the state would like to, but some hospitals are driving the conversation by saying 'No way.' It's because they are higher-priced and they know it, so they're going to oppose making it easier for patients to compare."
Crouse Hospital posts prices online, but Boynton says making costs and quality metrics transparent is more difficult than it might seem. The information that can be made available publicly is limited by the hospital's ability to calculate the many variables that go into determining a patient's actual costs, she explains.
For most procedures and treatment options, the Crouse Hospital website provides data such as the number of surgeries performed at the hospital, the typical age, approximate payer mix, the average price to the hospital, and the average amount reimbursed by the payer. The commercial health plans have to be combined for the average price and reimbursement figures because their contracts do not allow the hospital to disclose detailed information on their agreements.
Boynton pushed for making cost information available to the public two years ago when she was chief financial officer, contending that other hospitals across the country (although none in the hospital's market) were leading the way and that posting prices just made sense. No other industry could get away with not disclosing prices, she says.
"If your car dealer calls and says the car needs more work, he tells you how much it's going to cost," Boynton says. "But you go to the doctor and they order a long list of tests and office visits, and nobody even talks about how much this is going to cost you."
The price listing received a lot of favorable attention when Crouse Hospital launched it July of 2014, and Boynton expected other hospitals in the area to follow suit. That hasn't happened yet, and she says the reason is that the level of consumerism in upstate New York is not high enough to make hospitals feel obligated to make the move.
While Crouse has not seen changes directly attributable to its price transparency initiative, the feedback from patients and families who have accessed the information has been very positive, Boynton says, adding that the online page receives between 40 and 60 hits a week.
A similar situation is found in North Carolina, where the healthcare industry is seeing a "rising but moderate amount of consumerism," says Doug Luckett, president and CEO at CaroMont Health, a 435-licensed-bed nonprofit hospital in Gastonia. Consumerism is still in the early stages, where people are learning more about their healthcare options and the related costs but not necessarily acting in a proactive manner. It's only been in the past two or three years that CaroMont has seen a rise in consumer behavior, first noted when CaroMont's financial counselors spent more time on the phone helping patients understand their options and their out-of-pocket expenses.
CaroMont is responding by increasing the educational opportunities for patients.
"We try to set expectations so that there are no surprises in the end, and that seems to be what they want most at this point. They don't expect a firm dollar figure, but they want to understand what range they can expect," Luckett says.
Luckett says the hospital encourages patients to call a financial counselor to talk through the financial questions. With so many managed care plans and the offshoots of those plans, it can be difficult for a patient to do his or her own calculations. Speaking to a financial counselor is still the best way to go because the counselor can ask the right questions to find out that, for instance, a patient has a certain managed health plan and not the plan's general coverage.
"This approach, combined with an increase in our commercial payer mix, which could be attributable to a number of things like ACA and an improving economy, has led to a decrease in bad debt for our system," Luckett says.
Hospitals respond to cost anxiety
Offering cost estimates to patients can be a tricky business, because a wrong estimate can either drive patients away if it is too high or upset patients if the estimate was too low.
OhioHealth in Columbus, with 11 nonprofit, faith-based hospitals, has tried offering out-of-pocket estimates in the past but found that the accuracy was reduced by insurers' reluctance to release the necessary details about their contracts. The insurers have loosened their grip on that data in the past two or three years, however, and now OhioHealth offers a price estimator hotline. The hospital is not quite able to do real-time adjudication the way pharmacies can do with prescription drug coverage, but it is getting closer, says Jane Berkebile, system vice president of revenue cycle.
"We also are promoting consistency and standardization in our messaging to patients, so they're not told in one department that an estimate is not available and then going to another department and getting an estimate for their cost," she says. "At the same time, we are changing the culture and what the patient expects. We explain that almost everyone will pay something out of pocket, and once we have that estimate, we do ask for a payment against that estimation."
Marketing to the financial concerns of patients can be a competitive differentiator, says Sarah E. Ginnetti, director of revenue cycle at Day Kimball Healthcare, a nonprofit, integrated medical services provider that includes Day
Kimball Hospital in Putnam, Connecticut; Day Kimball Medical Group; and four medical centers. Successfully engaging patients as consumers can create an ongoing relationship, especially if you help remove financial barriers by offering financing options and payment plans, she says.
Offering payment plans with its patient financial engagement partner CarePayment, has reduced Day Kimball's bad debt expense, she says. Patients are now paying their bill sooner rather than later, which Ginnetti says has allowed the health system to keep resources focused on helping the patient rather than trying to collect.
Ten percent of all patient payments received are a result of patients enrolling in the CarePayment program, Ginnetti notes. Patient payments increased by 27% overall after Day Kimball implemented the CarePayment program four years ago, and bad debt numbers have held flat since then despite patient balances growing with the advent of high-deductible healthcare plans.
"Most things in American culture require financing now, for better or worse, and having that same option in healthcare is a huge advantage because it allows people to have a budgeted amount every month and stick to their overall budget as a family or individual," she says. "It's predictable and that makes a huge difference even if the total amount you're paying is substantial. We're trying to offer that predictability with up-front education and these financial tools."
Day Kimball Healthcare recently launched a new tool intended to provide patients with a much more robust estimate of expenses so they can make informed choices. The group also developed an infographic titled "Health Insurance Math Simplified (kinda)" to walk patients through key steps in the process, from how insurers set rates and providers get paid to how patients pay for insurance and other medical costs.
Mixed reviews on consumerism
South Nassau's Bogen expects to see the consumerism movement grow in the outpatient sector but says he hopes it doesn't achieve any more presence in inpatient care than it already has.
"I still believe it's crass to call them consumers," he says. "On the outpatient side, it's more fitting that people will shop for price, and you could argue that much of the outpatient services are commodities, but I don't believe that to be true from an inpatient perspective, and I would hate to have people make what ultimately could be a life-and-death decision on the basis of cost."
Still, Herzog says he sees consumerism as a tide that won't be turned back, so he advises healthcare organizations to accept the change and respond accordingly.
"We have to look at this as a great opportunity to serve people better, and that's going to mean we have to be different," Herzog says. "Instead of fighting to maintain the status quo and get more market share, which is what most of us are doing, we need to sustain and preserve the best parts but make the changes that consumers need from us. While only a few organizations are pioneering this approach, the intellectual acceptance of the need for this transformation is an important first step."
Bundling reimbursements for cancer treatment uses evidence-based protocols and outpatient clinics, and is intricately related to improving outcomes.
This article first appeared in the March 2016 issue of HealthLeaders magazine.
The considerable cost of oncology care represents a challenge as the healthcare industry faces increasing pressure to cut costs. Bundling cancer care is emerging as a way to provide quality care for less money, but that will require significant changes to the traditional approach to cancer care, according to some healthcare leaders at the forefront of this initiative.
Signaling the government's desire to bring down the cost of cancer care, the Centers for Medicare & Medicaid Services recently announced the Oncology Care Model, which aims to incentivize cancer doctors to reduce hospital and pharmacy costs. Starting in 2016, the cancer payment model will pay qualifying oncologists $160 per month for six months for each beneficiary receiving chemotherapy. But oncology clinics and hospitals will be required to make certain changes to the way they meet patient needs, including providing round-the-clock outpatient clinics to manage common drug therapy complications that might otherwise send their patients to the hospital.
Most of the changes are intended to make oncology more patient-centered, because successfully bundling reimbursement for cancer treatment is intricately related to improving outcomes, which in turn requires better patient integration in the care plan.
Using evidence-based protocols and including patient measures of quality of care, the model also incentivizes surgeons, radiologists, and primary care providers to improve communication and coordination, further reducing costs as a result of better care coordination. Lancaster (Pennsylvania) General Health/Penn Medicine has applied to the CMS demonstration project, and Randall Oyer, MD, medical director of the oncology program at Lancaster General's Ann B. Barshinger Cancer Institute, says the CMS project exemplifies the right way to approach cancer care in the future because it is more patient-centric.
"We thought that one-third of the changes required for being compliant with the project we had already accomplished, and another third we were already developing," he says. "Only a third of the changes would be new work for us."
One of the most significant changes in oncology care at LGHealth/Penn Medicine has been the move toward a care team in which the physician is only one member working with other professionals who are equally important, Oyer says. They include the oncology nurse, oncology nurse navigator, chaplain, social worker, and financial counselor. LGHealth/Penn Medicine is a 630-licensed-bed nonprofit health system with a comprehensive network of care encompassing Lancaster General Hospital and Women & Babies Hospital as well as a 300-member physician practice.
Success key No. 1: Probe deeper for patient input
Another strategy at ABBCI is to conduct distress screening for cancer patients at regular intervals, which Oyer says gives the patient an opportunity to voice any concerns about financial, social, spiritual, or physical needs. In addition, LGHealth/Penn Medicine has developed a process for making advance care planning a standard of care in oncology.
"We've changed our thinking from 'Something could happen, so you should think about end-of-life planning,' " Oyer explains. "We turned that around to a positive approach that says, 'We want to take care of you in a way that's compatible with your wishes, so we need to know what your wishes are.' That opens it up for the patient to tell you what they want."
LGHealth/Penn Medicine emphasizes to patients that they have a say in the care they receive. That message also is stressed to staff, who are encouraged to have the patient "teach back" to ensure understanding. The hospital is exploring options for decision-making aids for patients and improving the informed consent process so that the care team can be confident the patient truly understands the options.
Research suggests that improved patient education leads to more conservative treatment choices, Oyer notes.
More direct conversations with the patient also can improve care and outcomes, notes Michael Steinberg, MD, chair of radiation oncology at UCLA's David Geffen School of Medicine in Los Angeles and director of clinical affairs for the Jonsson Comprehensive Cancer Center at UCLA. A good example, he says, are women undergoing breast conservation. They are among the healthiest people in any oncology clinic because they are not sick, or many are not receiving chemotherapy, so the patient's chart usually reflects that the doctor asked how things are going, and the patient said everything was fine.
Steinberg's clinic began using a formal questionnaire and received different answers.
"When you actually ask the patient in a more structured way, with a validated instrument, you'll find out that the patients are suffering increasing fatigue over the five or six weeks of treatment, plus the anxiety and depression that is expected with a cancer diagnosis," says Steinberg. "Having that information helps us direct their care more effectively, and that has to be a part of any approach to improving value in oncology."
Success key No. 2: Collect more data
Steinberg and his colleagues also developed a database that includes not just the usual demographics about the patient and treatment, but also patient-reported outcomes. By linking those patient-reported outcomes back to the radiation doses used in treatment, the clinicians were able to establish a link that had never been documented before, he says.
"A real-time database that includes patient-reported outcomes becomes a powerful management tool, not only in improving the quality of care for the individual patient, but also in improving our technical expertise with all patients," Steinberg says.
LGHealth/Penn Medicine also began collecting more data to support patient-centered care decisions and cost savings.
"We're collecting more up-front data which risk stratifies the patient and may help us predict and preempt a need," Oyer says. "The initial reaction from the staff is that all the changes and data collection is a lot of work, but our experience has been that if you look at your workflow and everyone is working at the top of their license, implementing these new initiatives doesn't take as much time as you think."
With oncology reimbursement undergoing a paradigm shift, there are different options for bundling and alternative payments, notes Debra Patt, MD, MPH, MBA, a practicing oncologist specializing in breast cancer, and medical director of outcomes research for the US Oncology Network, a physician-led organization of integrated, community-based oncology practices. The organization, which is supported by McKesson Specialty Health, is based in Woodlands, Texas, and has nearly 1,000 physicians in 350 centers of care. The common theme among all the options is the need for data, Patt says.
With bundling and evidence-based protocols taking a more prominent role in oncology, healthcare organizations will need more than outpatient data, she says. The data will need to reflect the continuum of care, particularly the largest drivers of oncology costs—drugs, acute care, and end-of-life care.
"In too many cases, the questions about what the patient with a terminal cancer wants goes unasked," Patt says. "End-of-life care can become a major cost driver in oncology, and many times it's because no one asked what the patient wants and the default policy is to do the most aggressive medical intervention. That's probably not in the best interest of the patient and definitely not the best approach for controlling costs."
Success key No. 3: Choosing the right bundle
In response to the increasing focus on the cost of care, some healthcare institutions are developing their own bundling programs with payers. Thomas W. Feeley, MD, head of the Institute for Cancer Care Innovation at MD Anderson Cancer Center based in Houston, has worked with United-Healthcare to develop eight different bundled payment models for the research-based clinical practices and protocols that have been created and refined over decades at MD Anderson, which sees more than 33,000 new patients a year.
Last year, MD Anderson and UnitedHealthcare launched a pilot to explore a bundled payment approach versus the traditional fee-for-service. The three-year project focuses on quality patient care and outcomes in head and neck cancers, bundling all the care for a year's worth of newly diagnosed patients with those cancers.
"We cover everything that could happen to those patients at MD Anderson, so it includes radiation therapy, surgery, chemotherapy, any diagnostic tests, follow-up visits, hospitalization, operating room costs, ICU—whatever they need as long as it happens at MD Anderson," Feeley explains.
There are four bundles to choose from, based on what the physician and patient select as their treatment plan. The bundles range in price for relatively simple treatment like surgery alone, to progressively more complicated treatments. The most expensive bundle is the patient receiving surgery, radiation, chemotherapy, and plastic surgery reconstruction.
Each of the four bundles also has a factor built in for patients who have two or more comorbidities, based on the Charlson Comorbidity Index, a method of categorizing comorbidities of patients based on International Classification of Diseases diagnosis codes. Clinicians at MD Anderson do not know if their patients are in a bundle.
The payers agreed to a stop-loss if MD Anderson encounters any extraordinary outliers in a patient's care. One year in, the pilot has 50 patients enrolled. None of them has completed a full year of treatment, but Feeley says the initial experience is encouraging.
"The biggest surprise is that claims management is more complicated than automated fee-for-service payments," he says. "These bundles have to be done outside of the traditional fee-for-service claims management, so the process on their side and on our side is manual, and that does pose more of a challenge."
Success key No. 4: Know your costs
Any bundling effort comes with the fear of discovering down the road that you negotiated too low a price for the care provided, but Feeley says so far there is no indication of that at MD Anderson. However, he stresses the importance of knowing your costs for care before entering into bundling agreements.
"If you don't really know your costs of delivering care, it's hard to sit down at the negotiating table and develop a fair price," Feeley says. "Institutions need to do a better job of figuring out what their costs of care are, for whatever they're going to bundle."
Oyer also notes that bundling requires striking a balance between cost and efficiency of care. Cost savings can never override the need for quality care, but the key decisions about what treatment is truly effective and worth the expense can only be made when the right data is available, he says.
Success key No. 5: Prepare for performance measures
Even if an oncology bundling program does not include performance measures from the outset, Feeley says healthcare providers should factor them into the long-range picture. Performance measures are being tied more and more to reimbursement, so any successful bundling program probably will have to meet performance measures in the future, he says.
"We are on the right trend here," Oyer says. "My colleagues here at the clinic are excited to see this move toward care that is more patient-centered. We want to control costs, and if we can make those decisions based on what works best for the patient, everyone can be comfortable about the changes that have to be made."
By identifying patients most at risk for readmission and focusing on best practices proven to keep patients out of the hospital, Stanford University School of Medicine's bariatric program reduced its readmission rates from 8% to 2.5% in four years.
This article appears in the January/February 2016 issue of HealthLeaders magazine.
With a mortality rate of 0.1% and relatively few complications, 30-day readmissions represent the one area in which bariatric surgery programs could improve, says John Morton, MD, director of bariatric surgery at Stanford (California) University School of Medicine and immediate past president of the American Society for Metabolic and Bariatric Surgery. Improving that rate requires identifying patients most at risk for readmission and focusing on best practices proven to keep patients out of the hospital.
About two-thirds of the readmissions are preventable, he says, and the most common reasons for readmission are dietary indiscretions and medication reconciliation.
Focusing on those two causes and other best practices enabled Stanford's bariatric program to reduce its readmission rates from 8% to 2.5% in four years. Stanford's 2008 pilot project on reducing readmissions evolved into the nationwide Decreasing Readmissions through Opportunities Provided program, which aims to reduce 30-day readmissions nationwide by 20%.
About two-thirds of the readmissions are preventable, one expert estimates. Identifying patients most at risk for readmission and focusing on best practices proven to keep patients out of the hospital can help.
This article first appeared in the January/February 2016 issue of HealthLeaders magazine.
With a mortality rate of 0.1% and relatively few complications, 30-day readmissions represent the one area in which bariatric surgery programs could improve, says John Morton, MD, director of bariatric surgery at Stanford (California) University School of Medicine and immediate past president of the American Society for Metabolic and Bariatric Surgery. Improving that rate requires identifying patients most at risk for readmission and focusing on best practices proven to keep patients out of the hospital.
John Morton, MD
About two-thirds of the readmissions are preventable, he says, and the most common reasons for readmission are dietary indiscretions and medication reconciliation.
Focusing on those two causes and other best practices enabled Stanford's bariatric program to reduce its readmission rates from 8% to 2.5% in four years. Stanford's 2008 pilot project on reducing readmissions evolved into the nationwide Decreasing Readmissions through Opportunities Provided program, which aims to reduce 30-day readmissions nationwide
by 20%.
"One thing that got my attention was a letter from an insurer saying that if our admission rate was above 5% we wouldn't be allowed to participate in the network anymore," Morton says. "I knew we had a problem, and we started looking at our data to find out what was wrong."
Success key No. 1: Identify at-risk patients
Identifying the patients most at risk of readmission early in the process will go a long way toward lowering readmission rates, Morton says, and that can guide whether the procedure is performed inpatient or outpatient. One rule of thumb is the 50/50 rule, which says a patient is at risk for readmission if the age or body mass index is greater than 50. A patient who has an established relationship with a primary care physician is at lower risk, he explains, because that doctor can help coordinate care.
Severity and comorbidities also can put a patient at risk for readmission. A hemoglobin A1c of 10% or the presence of more than three comorbidities should be a readmission warning sign, Morton says. Insurance status also plays a role, with Medicare and Medicaid patients more likely to be readmitted.
"A long case is another factor, because a long time in surgery can be a marker for technical difficulties," he says. "Probably the biggest risk for readmissions is going to be complications at the time of surgery."
Success key No. Key 2: Choose the right setting
Readmission rates also can be affected by where the surgery is performed, Morton notes. Only two of the three common bariatric procedures in the United States can safely be performed in an outpatient setting—the gastric band and, under some circumstances, the sleeve, he says.
"There's a potential for higher readmission rates in ambulatory surgery," Morton says. "There is a certain amount of patient education that takes place in an inpatient setting that may not be happening in ambulatory surgery. That's not to say that an ambulatory surgery center can't do the same level of education, but it's not routinely done."
Any risk factors identified in the patient evaluation should be considered carefully when determining whether outpatient surgery is acceptable or poses too much of a readmission risk for that patient, he says. The more risk factors a patient has, the less likely that outpatient surgery is the right choice.
Success key No. 3: Educate, educate, educate
Pilot projects at Stanford and other bariatric programs have shown that the level of patient education about bariatric surgery and postop requirements has a significant effect on readmissions. Key points to emphasize are the need to ensure that the patient stays hydrated, knows the right and wrong foods to eat, and avoids advancing the diet too quickly.
Stanford and other healthcare institutions have standardized their preop education, creating a video that provides consistent messaging. The video includes presentations from a range of disciplines, including nutrition, psychology, and pharmacy. Patients can watch it repeatedly, which Morton says is important not only for the reinforcement but also because patients may be distracted or stressed the first time they watch.
"We give that education when they are an inpatient, and give them a phone call the day after discharge to remind them and answer any questions," he says. "Part of that education process includes discussing their medications and how those may change after surgery."
Realizing that postop education and monitoring was critical to avoiding readmissions, Stanford made the postop phone call more than just a cursory "How are you doing?" Instead, Stanford budgeted nursing time for the calls and set expectations for what information was to be conveyed and collected.
"They're not doing it here and there, between things," Morton explains. "They have dedicated, focused time for doing this because we feel it is that important."
Joanne Prentice, RN, BSN
Stanford also sends a letter to the patient's primary care physician after surgery, discussing the patient's postop plan. Morton's team at Stanford found that dietary compliance could be improved, so in addition to pre- and postop education, now the patient also meets with a nutritionist at the two-week follow-up visit."One year we had nine readmissions related to diet, and following the implementation of the nutritionist visit it went to zero," he says. "It had real impact for our practice."
Success key No. 4: Engage pharmacists more
Research has shown that improved coordination with pharmacists—both preop and postop—will lower readmission rates in bariatric surgery, Morton says. About 90% of bariatric procedures in the United States are performed in hospitals accredited through the Metabolic and Bariatric Surgery Accreditation and Quality Improvement Program from the American College of Surgeons and the ASMBS, and a hallmark of that program is multidisciplinary care that can include psychologists, nutritionists, and pharmacists.
"Medication reconciliation is particularly important for the bariatric patient because so many of them come in with multiple medical problems and multiple medications," Morton says. "The nice thing is that after surgery they're able to discontinue a lot of those medications, but it has to be done in a controlled, systematic way. That's where the pharmacist can really help out."
If the medications are not tapered properly, even a patient who won't need them after surgery can suffer an artificial drop in blood pressure or sugar levels to the point that they require hospitalization, he explains.
At MetroWest Medical Center, which comprises two hospitals and a network of supplementary service centers throughout Boston's western suburbs, when a new bariatric surgery director joined MetroWest Medical Center in Natick, Massachusetts, in 2014, the hospital used that opportunity to improve the bariatric program, notes that program's coordinator, Joanne Prentice, RN, BSN, CBN, CAPA. She met with the bariatric surgery head and discussed the importance of managing medications for comorbidities and pain.
"He asked that I take a detailed list of medications, including information like whether it was coated or long-acting pills, what form the patient was used to," she explains. "We want to be able to manage their comorbidities and not disrupt that ongoing care, but also to provide the pain medications our patients will need. That list is evaluated preop and provided to the hospital staff so that we know what to discharge the patient with."
MetroWest also determined that its bariatric patients' pain management was a leading cause of readmissions. In 2014, MetroWest implemented an initiative designed to make it easier for patients to comply with their discharge instructions regarding all medications.
"All medications, instead of being in pill form, are now in crushed, liquid, or chewable form for the first two or three months postop," Prentice explains. "We realized that patients were having a difficult time with the pills, with swallowing or with the medication upsetting their stomach, and so they weren't taking the pain medications the way they needed to. The resulting pain sometimes led to readmission." The improved partnership with the pharmacy is a primary reason that the readmission rate at MetroWest is low, she says, with no readmissions in the past 16 months.
Stanford also makes sure that the patient's postop medications are available in the clinic at the time of discharge. That helps ensure the patient begins the medications without any delay from going to a pharmacy.
Success key No. 5: Address hydration effectively
When the Stanford team analyzed its data on readmission rates to find the causes, hydration issues emerged as a leading factor: Patients would become dehydrated after surgery and that would lead to other complications and hospitalization. MetroWest came to the same realization, and now both organizations put more emphasis on hydration during patient education. At both facilities, patients are presented with branded water bottles and taught to carry them at all times.
That effort was to prevent dehydration, but Morton and his team also thought there was a better way to treat it.
"If you just bring them into a clinic or an infusion center, they can be hydrated and sent on their way. They don't require full admission," Morton says. "We make every effort to treat them outside the hospital if they just need hydration, but to do that we have to detect it before the dehydration causes other problems."
The nurse's phone call after surgery addresses hydration specifically, urging patients to drink water and educating them on how to recognize dehydration so that it can be treated promptly.
MetroWest also instituted a plan for hydrating postop patients in its outpatient clinics before they got to the point of needing hospitalization.
"The hydration effort is a good example of how you lower readmissions by looking for those problems that just get worse and cause the patient to spiral down until hospitalization is the only choice," Prentice says. "Patients will have some issues like that after surgery, but the key is to identify them and respond before it gets out of control."
