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Before you File
Best of Business 2011
In the Zone
The Business of Intelligence
When Opportunity Knocks
Regardless of what legislation is passed, until we begin to address the key issues of cost and utilization of care, consumers who buy insurance won’t see any dramatic impact on the cost of that insurance.
There are studies that suggest 35 percent of healthcare delivered today is not medically necessary. Why is that? Is it because a practice is practicing defensive medicine or are there incentives on a fee-for-service basis? Another factor is our health status. We are living longer, but our health status is not improving—it’s declining. More and more of us are diagnosed with sugar diabetes or cholesterol issues or blood pressure issues, which are all related to our status of health.
What can be done to engage and educate healthcare consumers to help them understand that they’re part of the problem if they don’t appropriately use the healthcare system?
WIRTHLIN: It’s hard to address that through any kind of policy, in terms of legislation. The reform legislation did attempt to address it through the innovation centers and the demonstration projects, where providers and insurance companies can come up with new models of care that better manage the utilization and services.
The university is looking for ways to structure the delivery of care so that we can better manage population-based care and take care of people with chronic conditions through the course of their care. Because that’s where the reimbursement is going to come. The course of care that a physician or provider recommends has a lot to do with how patients access the system. When we’re better able to take care of them for their entire disease or condition, then we will utilize resources much more effectively.
SMITH: It’s not surprising that people behave as they’re incented to behave. So the incentives need to change, clearly. If we’re going to make reform work, we have to be as compassionate as we can within the realm of fiscal responsibility.
HASBROUCK: A fair amount of the enabler of some of this change has got to come from information. In a lot of ways, we’re recreating the ‘90s. This whole thing of shifting accountability and risk to providers—we’ve done that all before, and we know what the consumer backlash was against that, which drove us away from it.
Look at the people rioting on the streets of Greece. If societies don’t explain to people how these changes can be done in a way that is not necessarily rationing but is actually improved value—I agree that there’s a fair amount of inefficiency in the system and that we could provide a similar amount of healthcare quality without rationing healthcare. But if people start to see risk being shifted to providers, the suspicion that is now focused on insurance companies—of the insurance companies trying to withhold care—if you start to push that to providers, the suspicion will be focused to providers: “My provider is rationing my care.”
There needs to be some macro-level information at the community level, using real data to show what are appropriate levels of care from a benchmark perspective. We have an asset in this community that we have underutilized—the All-Payer Claims Database. We should start to use that as an enriching data source in our environment.
I don’t think it’s enough to just change the economics and the incentives. There has to be an information-rich environment to inform the public.
BENNETT: Many of our clients have adopted HSAs and things of that nature that require employees to have more participation, more transparency. We obviously thought that employees would be more engaged in the decision-making process and be more aware of costs. But we’ve been surprised at the level of engagement. We’re hearing from clients that employees are starting to collaborate much more and talk among themselves, starting to share, “What orthoscopic did you see? What was the outcome?”
ADAMS: Both regionally and nationally, we’re starting to see some decline in utilization, and I believe in part it’s due to individuals having higher deductibles, higher copays. It’s the economic reality of the cost of health insurance, and I think that’s having an impact.
How is the Utah Health Exchange working? Is the exchange an important part of health reform or will it not really impact you as employers?
HURST: I give credit to the state for developing Utah Exchange. I didn’t expect the launch of the exchange to be perfect from day one, but the exchange has now grown to just over 4,000 members. They are working through some of the challenges that they faced early on with underwriting and the risk management components of that. So I see some real positive progress being made there.