Small slice of employees spend majority of healthcare funds
In a snap shot of the upside-down dilemma that drives the cost overruns of American healthcare, a new study reveals that an estimated 15% of the U.S. employee population generate 80% of employer healthcare costs.
According to a white paper sponsored by private healthcare technology firm Big Bang Health, 5% of the employer-insured population generates 50% of healthcare costs, while 15% generates 80% of healthcare costs. These costs are due to ineffective, inefficient, uncoordinated care, and lack of care advocacy, according to the white paper’s authors.
The white paper found that nearly 20% of that cost — an estimated $700 billion annually — is caused by diagnosis errors. Plus, the high-risk employer-insured population must navigate through a complex web of providers as they seek treatment for their multiple chronic medical conditions.
Even if the high-risk populations receive care, white paper authors found that the odds of them receiving the most recent recommended, evidence-based care is “a coin-flip 50%.”
Finally, the authors found that the presence of behavioral and/or substance abuse disorders drives the probability for hospitalization up to 300%.
“The U.S. healthcare system is typically viewed as a singular entity, however, it is actually comprised of three insurance market sectors based on source of reimbursement: public sector (federal/state, county/city), commercial (fully insured and commercial), and employer administrative services only. While each of those markets have unique characteristics, they all share a common challenge: a story of unmet needs, resulting in disproportionate health care utilization and cost by high-risk subpopulations,” says strategic adviser, Jed Goldart, M.D., M.P.H., author of the White Paper.
“One reason costs are skyrocketing is that when people do get treated, only half get recommended, evidence-based, guideline care coordination treatment,” adds Chris Fey, founder, chairman and CEO of Big Bang Health.
Confusion over the healthcare providers and what services actually deliver the best results further complicate the situation.
“We tell employers that they are paying the bill and employees are suffering. We have had family and friends who have been thrown into the 15% and they have no ability to identify if one surgeon is better beyond quality metrics,” says Fey. “When looking for a knee replacement, you want to know [about the medical specialist’s expertise]. Most metrics say if they are certified and if they have any litigation against them. They don’t say, “Does this surgeon do 200 procedures a year or two?”
Fey asks, “Which one would you want to go to?”
Mission control, can you hear me?
Big Bang Health, which focuses on self-funded employers, addresses patient-centric care with a feature it calls “Mission Control,” a system where a patient can call a sponsored medical professional to discuss their diagnosis and treatment options. Unlike other solutions such as telemedicine kiosks that embrace online interactions between doctors, nurses and patients, Mission Control focuses on the human voice.
If you get in Mission Control, it means that you have a problem. It’s a phone call to a highly skilled and trained nurse that can dissect what that person is saying. It includes medical reports that are reviewed by physicians to make sure the diagnosis they received is correct — or if it’s not correct, they give them a second opinion in their local marketplace,” says Fey.
“The first thing is ‘give me the facts,’ and it’s hard to do that in a web application,” he says. “Patients need to talk to someone and we are going counter to everyone putting everything on the web. You have to talk to someone.”
Fey adds, “We are all focused on the patient-centric component of getting correct care according to where are at that specific life moments as they become more complex.”