Waste in health care is real, and no one disputes that its
impact is evident. Employers who are the most educated about the available
solutions in the market are leading the charge in reducing the knowledge gap,
positioning themselves to actively take control of their spend and futures.
By Joseph Hopkins | January
13, 2020 at 07:14 AM
We all
know the health care system is rife with wasteful spending. But when
researchers from a prestigious institution like the University of Pittsburgh
School of Medicine estimate that waste at 25 percent of all spending, alarm
bells go off. And it got me to wondering what the magnitude of employer health
care spending might be.
The
University of Pittsburgh research, published in JAMA in October,
was referenced in a HealthLeaders article that cited more research pinning
total 2019 U.S. health care spending at $3.82 trillion. OK, 25 percent of that
gives us $955 billion.
Let’s
take the next step: The Integrated Benefits Institute, a health research group
that works with U.S. employers, said in its report that U.S. employers spent
$880 billion on health care benefits for their workers and dependents last
year. A quarter of that equals $220 billion. Lots of nations don’t have GNPs of
$220 billion.
Now,
let’s take a look at how the University of Pittsburgh team subdivided the cost
of wasteful spending. The six main wasteful spending categories:
·
The annual cost of wasteful spending
from administrative complexity accounts for the highest
category of waste, estimated at $265.6 billion.
·
The annual cost of waste from pricing
failure is estimated between $230.7 billion to $240.5 billion.
·
The annual cost of waste from failure
of care delivery is estimated between $102.4 billion to $165.7
billion.
·
The annual cost of waste from overtreatment
or low-value care is estimated from $75.7 billion to $101.2 billion.
·
The annual cost of waste from fraud
and abuse is estimated between $58.5 billion to $83.9 billion.
·
The annual cost of waste from failure
of care coordination is estimated between $27.2 billion to $78.2
billion.
Most of
us in the employee health care industry have come across some of these issues
in several silos, but rarely are all six called out in an article.
Seeing
these pain points laid out in this format has shown me that there is a common
theme trending between all of them. The theme is knowledge… Or lack of it. Or
lack of sharing it.
Amidst
deep blue ocean of employee health and benefits solution providers, some
solutions have been developed, implemented and are actively being deployed to
combat each of the six essential items. Every single one of these categories
has generated ways to reduce spending. Unfortunately, employers are not in a
position to address all of them. But even by banding together and targeting
three–for instance, administrative complexity, failure of pricing, and
overtreatment or low-care value–businesses could save billions they now
dedicate to health plans, using those precious dollars to drive new business,
attract top talent, and seek innovations in critical products and services.
The
problem
We have
to get the information out there. Most employer groups or, more specifically,
those who are in decision making roles regarding employee health benefits and
risk, do not know that these solutions exist. There is a knowledge gap that is
continuing to widen daily, in part due to the way that solution providers
approach employer groups with this knowledge. Unfortunately, there are less and
less consultative minded front-line professionals who are solely dedicated to
educating and providing value without the need for reciprocation. As always,
there are two sides to every coin, and this one is no exception. Either the
status quo, hubris, or many other reasons impede employee health decision-makers
from opening a curious ear to new ideas and solutions to the problems they
face.
The
resolution
Free-flowing
knowledge–not pitching, but freely educating those who are eager to
listen and learn–is what we need. This presents a challenge to those like me
who provide solutions. Sure, my job is to sell our products, but if our
potential customers don’t even know such products exist, don’t I have an
obligation to talk about our products in the context of a health plan spending
revolution? The pieces for that revolution are in place. The challenge is to
engage those who would be freed by the revolution.
Spend
30 minutes in a “learning session” without saying your company’s name. Make the
time to listen and learn. Thirty minutes of listening won’t ruin your day;
however, what you may discover in those 30 minutes can improve the health care
experience for your employees and reduce the waste in spend that your company
loses year after year.
Simply
put
Waste
in health care is real, and no one disputes that its impact is evident.
Employers who are the most educated about the available solutions in the market
are leading the charge in reducing the knowledge gap, positioning themselves to
actively take control of their spend and futures.
Joseph
Hopkins is the director of business development at Premise Health.
https://www.benefitspro.com/2020/01/13/why-waste-in-health-care-is-a-knowledge-problem/?utm_source=dlvr.it
No comments:
Post a Comment