Should costs matter in healthcare decision making?- 2015 Policy Prescriptions® Symposium

Should Costs Matter in Your Decision-Making?

Laura Medford-Davis, MDRobert Wood Johnson Clinical Scholar

University of Pennsylvania Emergency Medicine

Key Takeaways

1. We spend A LOT on healthcare2. Costs affect our patients

Outline

1. How much does it cost?2. Cost Trends3. Impact on your patients4. Value

MedScape Emergency Medicine Physician Compensation Report 2012.

Do You Know How Much We Charge?

$1000-2000 $2000-3000 $3000-4000 $>40000.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

CT Abdomen and Pelvis with Contrast

Do You Know How Much We Charge?

$1000-2000 $2000-3000 $3000-4000 $>40000.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

$5,620

CT Abd $2,876 CT Pelvis $2,317 IV Contrast $178 Gastroview $29.80 Physician Fee $219 Total $5,620

CT Abdomen and Pelvis with Contrast

Do You Know How Much We Charge?

• Median Charge for ED Visit: $1,233– Kidney Stone $3,437 (Range $128 - $39,408)– Cold/URI $740 (Range $19 - 17,421)

Hsia et al. PLoS ONE 2013.

Wild Variations

Dartmouth Atlas

Typical ER Bill-Facility ChargesService Quantity Total ChargeLevel 4 ER Visit 1 $954Conscious Sedation 1 $22Ankle XR 2 $586BMP1 $199CBC 1 $133Coags PT 1 $15Coags PTT 1 $108Dilaudid 1mg/ml 4 $12.16Propofol 10mg/ml 2 $19.20IV Push 2 $136

TOTAL $2,184.36

Typical ER Bill-Professional ChargesService Quantity TotalLevel 4 ER Visit 1 $329Conscious Sedation 1 $200Ankle XR 2 $116Lower Leg Splint 1 $475

TOTAL $1,120

Typical ER Bill-CostsTOTAL $2,184.36Medicare -$424.85Insurance Adjustment -$1,657.12

Patient Responsibility $102.39

Profit Margins by Payer

Series1

-60

-40

-20

0

20

40

60

PrivateMedicareMedicaidUninsured

Perc

ent

Outline

1. How much does it cost?2. Cost Trends3. Impact on your patients4. Value

We Spend…A Lot

• $2.7 Trillion

• $8,680

• 17.9%

• 21.8%

We Spend…A Lot

• $2.7 Trillion – spent in the US in 2011

• $8,680 – per American

• 17.9% - Percent of GDP

• 21.8% - Spent on top 1% of patients

Carton of Eggs

$3

Carton of Eggs

$55

Centers for Medicare and Medicaid Services 2013.

Centers for Medicare and Medicaid Services 2013.

What Are We Paying For?

Outline

1. How much does it cost?2. Cost Trends3. Impact on your patients4. Value

Insurance Premium Prices are Rising

Kaiser/HRET Survey of Employer-Sponsored Health Benefits

Healthcare Spending for a Family with Average Income $66,570

Premium Contribution $3,100Out-of-Pocket Costs $1,952Tax contributions to government health programs $4,664Foregone Wages $6,482

TOTAL $16,198

Polsky D, Grande D. N Engl J Med 2009;361:437-439.

Kaiser Family Foundation from AHRQ-MEPS Table 1.1

Out-of-Pocket Spending up 73%

Increase in High-Deductible Plans

Kaiser/HRET Survey of Employer-Sponsored Health Benefits 2012

Effects on Patients

• 41% have trouble paying medical bills• Medical bills are the #1 cause of bankruptcy– 3 in 5 bankruptcies

Commonwealth Fund Health Insurance Survey 2012

Outline

1. How much does it cost?2. Cost Trends3. Impact on your patients4. Value

Quality x AccessVALUE = ------------------------

Cost

↑Health↑Patient Experience↓Costs

Triple Aim for Healthcare Improvement

Choosing Wisely

1. CT Head for low-risk head injury2. CT Head for Syncope and normal neuro exam3. CT A/P for kidney stones4. Foley Catheters5. Wound cultures for I&Ds6. IVF for kids without PO challenge7. CT PE if PERC Negative8. Spine imaging for low back pain9. Antibiotics for sinusitis10.Futile end-of-life care in the ED

The Future• Increased Price Transparency• CMS Paying for Value• ACA Exchange Plans– Narrow Networks– Higher deductibles

Key Takeaways

1. We spend A LOT on healthcare2. Costs affect our patients3. The future is moving toward Value

Questions