The burden of medical costs continues to shift from employers to employees, as both deductibles and out-of-pocket maximums continue to rise and savings from self-directed healthcare fail to materialize.
Between 2014 and 2015, employees and other patients experienced a 13% increase in both costs, according to an analysis conducted by TransUnion Healthcare. The report includes anonymous data on commonly administered procedures from thousands of providers nationwide, including hospitals and healthcare clinics.
Employers, the report concludes, are lowering their premiums through coinsurance and high deductible plans that force employees to assume a larger share of the costs. In the meantime, however, initiatives such as self-directed healthcare, intended to reduce healthcare costs by encouraging value-based purchase decisions and lower utilization, have so far failed to gain traction.
“Unfortunately, as price transparency and out of pocket retail healthcare are just evolving, most [employees] are disengaged from this process,” explains Jonathan Wiik, TransUnion Healthcare’s principal for revenue cycle management.
In 2015, the average deductible was $1,278, while out-of-pocket costs rose to $3,470. Medical procedures with the highest out-of-pocket costs included dermatology ($2,451), orthopedics ($2,405) and general surgery ($2,264).
While their impact has been limited to date, Wiik points to a number of efforts to help employees control their healthcare costs that continue to hold potential.
Insurance providers, he says, are attempting to address the rising costs by directing employees to lower cost facilities, and both insurers and healthcare providers are using tools to educate their patients. They are also focusing more closely on clearing patients for care by verifying coverage and out-of-pocket costs and then communicating those costs in advance.
Employers, meanwhile, are developing price transparency tools to help employees make more informed decisions. And they are working with insurers on narrow network plans that offer fewer care choices but are also less costly. For its part, TransUnion offers tools to help hospitals and physicians engage patients in financial discussions about coverage, payment and assistance.
Healthcare costs are starting to level out, asserts Wiik, although spending is still around 18% of U.S. GDP. “That’s a lot of money,” he concedes.
In such a market, Wiik says, “Employers have to get creative – they have to get their employees engaged in their care and the cost of their care.” Among the strategies he recommends to help employees are wellness plans, benefits for seeking care at the lowest acuity, regular exams and early disease detection.
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