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Employers Should Tell Employees Where To Get Health Care More Often

No, not like that you think, perhaps.

But, employers should be increasing incentives for employees and their covered dependents to seek care at higher quality, cost-effective health care providers. That usually means less about discriminating against clinic-based doctors than it does discriminating against higher cost hospitals.

Because no, higher costs do not necessarily mean higher quality of care. Set aside the usual debate about how much more the United States spends on health care versus other developed countries, without better health outcomes. Even in the United States greater spending on health care does not mean better care for patients.

Today, employers are increasingly finding out there is a lot of care being delivered that isn’t improving patient health. Take this example:

Walmart Inc., the nation’s largest private employer, is worried that too many of its workers are having health conditions misdiagnosed, leading to unnecessary surgery and wasted health spending.

The issue crystallized for Walmart officials when they discovered about half of the company’s workers who went to the Mayo Clinic and other specialized hospitals for back surgery in the past few years turned out not to need those operations. They were either misdiagnosed by their doctor or needed only non-surgical treatment.

A key issue: Their diagnostic imaging, such as CT scans and MRIs, had high error rates, said Lisa Woods, senior director of benefits design for Walmart.

The reason programs like what Walmart is doing now work is because of a troubling high instance of incorrect or low quality care being administered because some providers are sticking with old practice patterns and not following the latest research on most effective care. This is important:

Many healthcare providers today are seeking to improve the value of the care they deliver by implementing standardized clinical practice guidelines aimed at reducing variations in care, avoiding complications, and lowering costs.

To succeed, such an initiative requires the full support and participation of the clinicians who will use the guidelines.

Providers also should have a fully developed infrastructure consisting of a clinical content system, an analytics system, and a deployment system.

This is exactly the kind of behavior Walmart is supporting. Use best practices, strongly encourage health care professionals in your system do so, and build the infrastructure to support them.

Walmart first made news in supporting such work when it announced several years back it would pay to send its employees to the well-regarded Cleveland Clinic for heart surgery.  The program worked and has since expanded to included centers of excellence around the country where Walmart will pay for its employees and a traveling companion to travel for care for heart disease, cancer, spinal surgery, and other high cost services.

Yes, the savings from more effective care, delivered with less complications and incorrect care, saves money in the long run…in addition to benefits for patient health (and employee productivity).

Sometimes it need not be as dramatic as paying for travel to care in another location because the combination of quality and cost are better. Employers are increasingly using health care coverage for employees and dependents that creates localized tiers of coverage.

Want to go to that higher priced children’s or university hospital where care is more expensive but outcomes aren’t any better for routine hospital care? Ok, but you’ll pay more.

One of the first to mainstream such “tiered” plans was Blue Cross Blue Shield of Massachusetts, establishing tiers where patient out-of-pocket costs were lower for certain hospitals. Less favored hospitals were still “in-network,” with related patient protections, but out-of-pocket costs would be higher for those choosing to go there. The plans were so popular with employers that local competition followed suit with similar offerings.

The trend continues, with additional examples across the country such as United Healthcare  and Blue Cross Blue Shield of North Carolina. Note in particular the emphasis on the improvement of quality of care in the North Carolina description. Sometimes the value of of getting correct care is just as important as getting care that isn’t obnoxiously priced, which is exactly what Walmart has done too.

As such plans become more common, studies have already shown such tiered plans save significant money. Between that and examples like Walmart in creating incentives for employees to go to preferred, high quality providers for expensive services it’s clear there is value in employers doing more to at least create very high incentives to see certain providers, even if it’s not strictly directing the patient.

Ironically, politicians will often try to claim everything should be between the patient and the doctor, but such programs show that isn’t always the case. What happens when doctors aren’t using the latest science on what’s proven to work and what works less well? Such wasted care significantly contributes to high costs. It’s also a very bad patient experience and at times has adverse impacts on health, in addition to not addressing the original health issue as well as possible.

It’s also a reminder that as long as employer-sponsored coverage is such a huge part of the system it’s essential for insurers/employers to be able to steer patients with network & benefit designs toward the highest quality hospitals and doctors. It often means bother better care & lowers costs.

And while policymakers struggle to transform our health care system, they should at least make sure to stay out of the way of such innovation. A recently announced bi-partisan Senate proposal aimed at addressing the issue of health care costs, rather than continued squabbling about coverage, includes provisions to block some of the anti-competitive practices that can be a barrier to incenting employees to seek care from certain health care providers.

Good.

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