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Millennials would rather use clinics and EDs than Primary Care Physicians

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The 83 million millennials are turning their backs to primary care providers (PCP) over the convenience, fast service, connectivity and price transparency of clinics or urgent care centers. A national poll of 1,200 randomly selected adults conducted in July by the Kaiser Family Foundation found that 26% said they did not have a PCP. There was a pronounced difference among age groups: 45% of 18- to 29-year-olds had no primary-care provider, compared with 28% of those 30 to 49, 18% of those 50 to 64 and 12% age 65 and older.
Waiting several days for an appointment when you’re sick is not super attractive to young people:
  • “These trends are more evident among millennials, but not unique to them. I think people’s expectations have changed,” Harvard professor Ateev Mehrotra told the Washington Post.
  • “Now people say, ‘That’s crazy, why would I wait that long?’” Mehrotra said.

PCPs are supposed to be the people at the center of our care, keeping tabs on patients’ health and helping to coordinate our needs. But if you’re only using the health care system when something is acutely wrong, going to urgent care or a clinic might seem more logical — and more affordable than the emergency room, which used to fill those after-hours needs.

The care may not be as good; in a recent study, half the people treated for a simple cold or flu at an urgent care clinic left with an unnecessary and potentially harmful prescription for antibiotics, compared with just 17% of those treated by a PCP, according to the Washington Post.

(Steve Debenport/iStock)

Breakdown of worker’s compensation and health insurance benefit

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The table below compares what companies and government have been paying their employees over the past 20 years: the percent share of employer costs for worker compensation and health benefits.

The table shows they paid more in benefits and less in wages and salaries, and that is especially the case among people who work for the unionized public sector.

Of all the different types of benefits, the cost of health insurance has consumed the most of the average worker’s compensation — representing 8.2 cents of a dollar in pay today versus 5.8 cents of a dollar in 1998.

source: Bureau of Labor Statistics

Plenty of blame to go around for high health costs

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Health care costs remain a leading issue ahead of this year’s midterms, and voters have plenty of blame to go around, according to the Kaiser Family Foundation’s (KFF) latest tracking poll.

KFF health tracking poll of 1,201 US adults (Aug/2018) asked whether certain factors are a “major reason” health care costs are rising.

  • Blame for the potential political culprits — the ACA and the Trump administration — was split about evenly
  • But there’s a broader bipartisan agreement that industry is to blame: > 70% faulted drug companies, hospitals, and insurers
  • Doctors caught a break, at 49%
  • Partisanship reigns, though, on the question of whether President Trump will help
  • 13% of Democrats are at least somewhat confident that Americans will pay less for prescription drugs under the Trump administration, compared with a whopping 83% of Republicans. Independents generally share Democrats’ skepticism
  • Roughly a quarter of Democrats and roughly two-thirds of Republicans think Trump’s public criticism of drug companies will help bring down prices
  • Surprise hospital bills haven’t attracted the same political uproar as prescription drug costs, but the Kaiser poll provides more reason to believe they could be the next big controversy
  • 67% said they’re “very worried” or “somewhat worried” about being unable to pay a surprise medical bill
  • 53% fear they won’t be able to pay their deductible
  • 45% are afraid of the tab for their prescription drugs
  • 39% experienced a surprise bill in the past year

 

To change nursing assignments and transform workforce management, hospitals need to plan differently!

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Massachusetts, New Jersey, Ohio, and Pennsylvania are getting ready to vote on legislation to mandate nurse-patient ratios like California did.

We learned from California that without a sound workforce planning methodology that can be consistently executed, hospitals won’t obtain the benefits of the increased staff [1].

The Nash Group SDM20/20™ planning methodology is proven to:

  • reduce labor cost $2M-$8M
  • dismantle consumption of premium dollars
  • advance patient placement and aggregation
  • improve patient disposition and reduce length of stay
  • increase staff retention 20%-40% and improve recruitment cycles
  • make workforce operations and schedules sustainable

[1] Petsunee Thungjaroenkul, Greta G. Cummings, Amanda Embleton, “The Impact of Nurse Staffing on Hospital Costs and Patient Length of Stay: A Systematic Review”, NURSING ECONOMIC$/Sep-Oct 2007, Vol. 25, No. 5

The next big battle in healthcare will almost certainly be about costs!

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Mounting frustration from employers and employees will put cost controls on the table faster than you might think, making the next big battle in healthcare almost certainly about costs!

Right now frustration over healthcare costs is starting to percolate, particularly over the concern that the industry already maxed out the existing tools for cost control.

California, for example, has proposed moving the state to an all-payer system, to give the state more control over doctors and hospitals insurance plan charges (only Maryland has an all-payer system). Are we really going to have a debate about all-payer? Is this one of those times when California is the wacky outlier state, or one of those times when it’s a trendsetter?

Once employers reach the end of their rope on healthcare costs, the cost-control debate is going to ratchet into a higher gear. That is the prelude to a debate over all-payer in every state, but government intervention will probably be on the table, at least in some states. The cost-containment debate is coming because policymakers are not going to put too much new revenue on the table, and that means that both the private sector and Medicare will be paying the most.

Costs have risen modestly over the past few years, and private insurance has responded, in large part, by shifting more of those costs onto consumers through higher copays, deductibles, and coinsurance. But we’re at the end of what the market will bear on cost-sharing.

This is a scary position for providers. If employees are at their breaking point on cost-sharing, and employers reach their breaking point on cost growth, expect political systems to get serious about cutting those costs themselves. The question remains … are healthcare organizations and doctors ready for real changes in reimbursement?

 

The dramatic increase in deductibles, especially within employer-based coverage

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In employer-based health plans, the average deductible for a SINGLE person is over $1,500, according to Kaiser — 3 times higher than it was a decade ago. The trend toward increasingly high deductibles means families struggle to afford their care, even with insurance.

Now, experts are starting to reconsider whether high cost-sharing — once conceived as a way to turn employees into more discerning healthcare consumers — is working.

“High-deductible plans do reduce health-care costs, but they don’t seem to be doing it in smart ways,” USC professor Neeraj Sood told Bloomberg.

This frustration with existing cost-shifting tools — and the growing sense that we’ve basically maxed out their utility — is contributing to the renewed focus on underlying health care prices.

  • Many employers don’t feel they can shift any more costs onto their workers, but that’s largely how they’ve kept premiums in check for the past several years. And they certainly don’t want to shoulder higher bills themselves.
  • As that frustration mounts, expect to see a greater political appetite for real cost controls.

The Coverage Gap: Uninsured Poor Adults in States that Do Not Expand Medicaid

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While the Medicaid expansion was intended to be national, the June 2012 Supreme Court ruling essentially made it optional for states. As of June 2018, 17 states had not expanded their programs.

Medicaid eligibility for adults in states that did not expand their programs is quite limited: the median income limit for parents in these states is just 43% of poverty, or an annual income of $8,935 a year for a family of three in 2018, and in nearly all states not expanding, childless adults remain ineligible. Further, because the ACA envisioned low-income people receiving coverage through Medicaid, it does not provide financial assistance to people below poverty for other coverage options. As a result, in states that do not expand Medicaid, many adults fall into a “coverage gap” of having incomes above Medicaid eligibility limits but below the lower limit for Marketplace premium tax credits (Figure 1).

This KFF brief presents estimates of the number of people in non-expansion states who could have been reached by Medicaid but instead fall into the coverage gap, describes who they are, and discusses the implications of them being left out of ACA coverage expansions. An overview of the methodology underlying the analysis can be found in the Methods box at the end of the report, and more detail is available in the Technical Appendices available here.

 

The Cost of Chronic Diseases in the U.S.

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Chronic disease management is a must when shifting to value-based care! The Milken Institute reported that the total costs in the U.S. for direct health care treatment for chronic health conditions totaled $1.1 trillion in 2016—equivalent to 5.8% of the U.S. GDP.

Chronic diseases also lead to indirect costs—lost income and reduced economic productivity—for the individuals suffering from the conditions, their family caregivers, and the overall economy. When the indirect costs of lost economic productivity are included, the total costs of chronic diseases in the U.S. increased to $3.7 trillion, equivalent to 19.6% of 2016 GDP—i.e., one-fifth of the U.S. GDP.

This trend is expected to get worse as an estimated 83.4 million people in the US will suffer from 3 or more chronic diseases in 2030 compared to 30.8 million in 2015.

The number of uninsured Americans is rising

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The cold war on Obamacare is having an effect. The uninsured rate has begun to creep back up since Trump became president. After several years of major declines under Obama, the uninsured rate has grown from 10.9 percent to 12.2 percent, according to Gallup. It’s not hard to imagine, in just one Trump term, that we could see half of the gains made under the ACA, which led to 20 million Americans being newly covered, erased.

Poll after poll shows the public wants this assault on the ACA to stop. After all this time, the program remains at a record level of popularity. Fifty percent approve, even as the administration badmouths and undercuts it.

Mostly, Americans want this assault on their ability to care for their families to end so we can begin the process of building back what has been allowed to erode. Americans want to pay less, not more, for health insurance. They don’t want insurance companies to be given unlimited authority again.

They want to see Medicaid strengthened, not weakened. They want the basic dignity of being able to afford medication and an end to the constant fear that grips so many that if they get sick, they will lose everything.

Americans didn’t want last year’s war on Obamacare, and they don’t want this new cold war either.

 

 

 

 

 

 

Sources: Gallup, KFF and  Vox – The Republican cold war on the Affordable Care Act

Under the hood on hospital pricing

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The actual prices hospitals charge private health insurers are closely guarded trade secrets. But a widely circulated health economics paper, which received some new updates, uses actual claims data from three national insurers to show the inner workings of how hospitals get paid.

The bottom line: Hospitals make a lot of money off patients who get their health coverage through their jobs, and hospitals with little or no competition have the power to set their rates at will.

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Why it matters: The amount Americans spend just on hospital care represents 6% of the entire economy, so it’s important to understand how hospitals price their services and to determine if patients and taxpayers are getting a good deal.

The backdrop: This paper builds on previous work that shows Medicare spending is almost entirely driven by the quantity of services, whereas private insurance spending is driven heavily by the prices and market power of hospitals — an increasing concern as more systems merge into dominant regional and national players.

Updates to the paper and thesis include:

  • “Insurers pay substantially different prices for the same services at the same hospitals,” the economists wrote.
  • “Prices at monopoly hospitals are 12 percent higher than those in markets with four or more rivals.”
  • “If private prices were set at 120 percent of Medicare rates rather than at their current levels, inpatient spending on the privately insured would drop by 19.7 percent.”
  • Many hospitals get paid based on percentages of their charges instead of fixed amounts, and that system “places them under less pressure to reduce costs.”

Sources AxiosThe Price Ain’t Right? Hospital Prices and Health Spending on the Privately Insured