Still on HM’s Horizon
Consumer-driven healthcare has yet to significantly affect hospitals and—by extension—HM groups, although hospital admissions were down 2% nationally in 2008 and hospital debts are climbing. Adam Singer, MD, CEO of IPC: The Hospitalist Company, says the impact of HSAs on HM isn’t noticeable yet because patients haven’t adapted to the new model. “Consumers usually aren’t price-shopping the facility, because they’re committed to their physicians and will go to the hospital where their physician has privileges,” Dr. Singer says. “Additionally, the patients hospitalists see are very sick. Many came in through the ED and had no choice about how they got there. They certainly don’t pick their hospitalists.”
By extension, the ED isn’t immune to market forces driving consumer-directed care. Karen McConnell, PhD, director of the Oregon Health and Science University’s Center for Policy and Research in Emergency Medicine, posits that rapid adoption of high-deductible plans could change ED utilization (Ann Emerg Med. 2005;46(6):536-40). Although the ED may be insulated from extensive shopping and price negotiation because visits generally are for urgent conditions, Dr. McConnell says, ED utilization patterns may change if cost-conscious HSA holders forego other necessary medical care or seek substitutes for less-urgent problems.
The reality of consumer-directed healthcare and patients footing more of their own medical bills could eventually have a significant impact on HM programs. “Hospitals are under attack,” Dr. Singer says. “The 20% to 50% of hospital medicine program revenues received as support payments from their hospitals may drop as high-deductible plans with HSAs drive down hospital revenues. So as hospital revenues fall, the subsidies—particularly some of the more absurd, seven-figure subsidies that hospitalists enjoy—are vulnerable.”
Patients Take Charge
With their own money at stake, HSA consumers are engaged in the decision to spend—or save—their healthcare dollars. Although the shift in the doctor-patient decision-making process has slowly found its way into the hospital, it is playing out in doctor’s offices—one of several pipelines for hospital admissions. As a consumer, Linda Waldmann, manager of MyCost, a real-time claims-adjudication tool offered by Alegent Health, introduced cost when making treatment decisions after she was diagnosed with carpal tunnel syndrome. She asked her orthopedic surgeon lots of questions, absorbed what he said, then made her own treatment choices.
“My orthopedist wanted me to have three tests, but I elected to postpone one test until my HSA replenished the following year,” Waldmann says. “Doctors are still hesitant about negotiating with patients, but this one understood my concern.”
Blue Cross/Blue Shield of Tennessee’s (BCBST) Maggie Fox, director of application systems, saw a large jump (to 33% in 2009 from 8% in 2008) among BCBST’s 5,000 employees opting for HSAs. The Tennessee company emphasizes prevention, education, and wellness as critical components of consumer-directed care, and the company’s HSA consumers are offered a variety of discounts for adhering to healthy lifestyles.