Employers and health insurers want more consumers use healthcare cost estimator tools and pride when choosing a hospital, physician, or clinical laboratory
Having put millions of consumers into high-deductible health plans (HDHPs) as one way to control healthcare costs, both employers and health insurers are now challenged to help these same consumers do better at using price and quality factors when selecting providers.
One solution to this problem is to encourage physicians to play a greater role in helping their patients use price and quality when it is time to select a provider. Obviously, these decisions can involve which clinical laboratory or anatomic pathology practice a patient should select when he or she needs medical laboratory testing.
Encouraging Physicians to Refer Patients to Lower-Cost Providers
For that reason, pathologists and medical laboratory managers should be aware of the new programs launched by payers designed to encourage physicians to be more active in providing price and quality information to their patients. As this happens, it will make physicians more influential in steering patients to one lab over another, but in new and different ways compared to the past two decades.
Recently, Modern Healthcare published a story about how payers—both government and private—are recruiting physicians to persuade their patients to consider quality and cost when choosing healthcare providers.
The problem to be solved is how to help people find information about prices and quality. For example, a 2012 Harris Interactive poll found that 62% of people think an online healthcare cost calculator is “important” or “very important.” At the same time however, only 6% of those polled had accessed one. That’s why payers, employers, and other interested parties want to enlist provider help in guiding patients to facilities that provide both quality and value.
Insurers Want Doctors to Address Cost and Quality With Patients
Ideally, insurance companies want physicians to integrate cost and quality tools into their conversations with patients. This is particularly true when ordering medical laboratory tests, diagnostic tests, or other procedures, noted the Modern Healthcare story.
UnitedHealthcare Group (NYSE: UNH), has developed a provider version of its Patient Healthcare Estimator. For the same reasons, Wellpoint (NYSE: WLP) gives providers access to what it calls Anthem Care Comparison. This is the cost and quality comparison tool Anthem provides to its members.
“It is unclear how much it is used [by physicians] to support [patient] referrals currently, but we definitely believe we need to foster greater use, especially for providers operating under our new reimbursement methods, where effectiveness of referrals will really count,” stated George Lenko, Program Director for National Networks at Wellpoint.
Health Insurers Targeting Specific Ancillary Services
Some insurers are targeting specific clinical services. When a physician orders an imaging test, for instance, Wellpoint’s subsidiary, American Imaging Management, assesses advanced imaging facilities in the patient’s service area for quality and price. It then shares that information with the ordering physician during the coverage precertification process, noted the Modern Healthcare report.
Should the physician disregard the information and refer the patient to a higher-cost, lower-quality facility, a Wellpoint representative calls the patient to provide a list of alternative providers and offers to set up an appointment. Imaging providers selected by Wellpoint save patients on average $1,000 per test.
Study Shows Most Patients Trust Doctors’ Referral Advice
Health insurers would prefer that physicians provide quality and cost data to their patients. That’s because patients trust their physicians and are suspicious of an insurer’s motives for suggesting lower-cost providers. A survey last summer by the Altarum Institute, a nonprofit healthcare research and consulting group, found that 76% of consumers believe their physicians have their best interests at heart.
But while physicians support the concept of discussing quality with patients, research suggests they are reluctant to discuss costs, noted the Modern Healthcare article. A survey of physicians published in July 2013 in the Journal of the American Medical Association (JAMA) indicated that only 36% of physicians believe they have a “major” responsibility for reducing healthcare costs.
Why Doctors Are Wary of Discussing Costs with Patients
There are several reasons why physicians are wary of discussing prices with patients. Harold Luft, Ph.D., Director of the Palo Alto Medical Foundation Research Institute, noted that—without a broadly accepted measure for quality—patients associate higher cost with better care. Therefore, they are suspicious of a doctor’s reasons for referring them to a lower-cost provider.
Luft also pointed out that, whenever a patient is suffering from a painful or debilitating condition, the physician is better off to synthesize cost and quality data without patient input, then simply recommend a treatment facility.
Susan Dorr Goold, M.D., a Researcher and Internist at the University of Michigan Health System, Ann Arbor, co-authored a study published in Health Affairs. In the study, focus groups gauged patients’ reactions to physicians who raise the issue of cost when discussing care options. She noted that focus group participants’ reactions to the idea ranged from skepticism to hostility. “Patients didn’t have a great interest in cost,” Goold said. “I was surprised how vehement they were.”
Interest in pricing, however, rises dramatically in accordance with a patient’s level of “skin in the game.” Victoria Lewis Bogatyrenko, Vice President of Innovation at UnitedHealthcare, noted that UnitedHealthcare members with HDHPs are “much more inclined” to use the patient cost estimator than those with health plans that pay most of the bill.
Physician Groups Paving the Way for Physician Help in Reducing Costs
The American College of Physicians updated its ethics manual in 2012 and called on physicians to practice effective and efficient healthcare and use resources responsibly. Accordingly, physician groups encourage their members to use cost and quality tools when discussing treatments with patients.
As a result, health insurers report that there’s little resistance by physicians to using their cost and quality tools. “They’d like to have that information, in a way that’s appropriate, so that they can have constructive conversations with their patients,” Bogatyrenko told Modern Healthcare. “Physicians and hospitals overall understand that this is an important change within the industry, so we didn’t get significant pushback at all.”
Convincing consumers with the best health plans to select healthcare services based on both cost and quality is likely to remain a challenge for some time. But with ongoing enrollment growth in HDHPs, greater numbers of consumers will proactively seek these tools and advice for their physicians to help them select quality providers that offer the best value.
This trend has important implications for clinical laboratories and anatomic pathology groups. For years, laboratory medicine professionals have bemoaned the attitude of payers to consider medical laboratory tests as a commodity item. As family physicians are given cost and quality tools by health insurers, it is a sure bet that—when it comes to identifying lab providers—those tools will favor price over quality.
If that proves true, it would put national lab companies with lowest prices in a favored position for patient referrals. On the other hand, if local and regional lab organizations can develop added-value services that are recognized by both physicians and patients as valuable, then these same tools may help them level the playing field with referring physicians.
How one family saved thousands on medical costs