Can health insurance companies play a role in improving health outcomes while lowering costs? On one hand, that sounds like the equivalent of a bear on a unicycle balancing plates on a pole; on the other hand, it’s been the mission of “managed care” since the ‘90’s.
Health insurance companies are a key component of the overall medical ecosystem and their sway can impact prices and care in incalculable ways.
Here are three key ways that insurers can improve care while lowering costs:
1. Reduce Unnecessary Testing
No one wants to “miss something” medically. For a hospital, that can lead to low morale and expensive lawsuits. For a patient, it can mean serious illness or death. So for a long time, the thinking has been test, test, test.
“A large public hospital, Los Angeles County-University of Southern California Medical Center, eliminated preoperative testing deemed superfluous before routine cataract surgery. As a result, patients on average received the surgery six months sooner.”
Yet, unnecessary testing can bring its own set of problems. Unnecessary tests can lead to human error and a deadly domino effect that is estimated to claim 30,000 lives a year. By comparison, auto accidents claim 40,000 lives a year. Such statistics in the auto industry have led to ever-safer cars, education campaigns and regulations. Not to mention the cost of unnecessary testing tops $200 billion annually, more than the GDP of many countries.
Obviously, no one wants to ax a test deemed critical to someone’s survival. But are six tests necessary before undergoing cataract surgery?
Consider this from Healthcare Finance News: “A large public hospital, Los Angeles County-University of Southern California Medical Center, eliminated preoperative testing deemed superfluous before routine cataract surgery. As a result, patients on average received the surgery six months sooner.”
This is a classic example of a less-is-more, patient-centric philosophy that’s good for everyone.
Create a Culture of Wellness
Insurance companies should be part of creating a culture of wellness through a system of incentives and using their leverage and marketing muscle to breed healthy habits.
Employers are doing a great job in leading the way to improve healthcare outcomes by offering incentives and perks to their employees who embrace a healthy lifestyle. Insurance companies should take a page out of their playbook.
For example, insurers can offer credits to customers who get a gym membership, complete a 5K or complete a smoking cessation program. Consider that smoking, despite all the efforts made to eradicate it, still costs $170 billion in direct medical care a year.
Dangling a juicy financial carrot in front of a “couch potato” could be just the thing they need to give them a push to make small steps toward a healthy lifestyle, and it’ll save the insurance company a mint from treating one or several chronic conditions.
This is the classic intersection of altruism and capitalism with the insurance company being the good cop in the middle directing traffic. PatientBond has a wealth of market research insights on incentives and penalties for good and counterproductive behaviors, respectively.
Leverage Health IT
The medical insurance industry has been slow to adopt technology. You can buy car insurance from your phone’s browser, but many health insurance websites are clunky dinosaurs. And this mainframe mentality seeps into other areas. Health insurance companies can and should embrace technology as a “second front” in the war on costs. Whenever and wherever, health IT should replace paper piles.
As HealthPayerIntelligence.com reports: “Healthcare payers could protect patient safety and prevent medical errors by implementing health information technology. Payers could incentivize providers financially for adopting electronic medical records and e-prescribing systems.”
We also like “virtual visits.” In an effort to bring down costs and offer convenience to members, some companies offer medical care from the comfort of your home. Visit a clinic with the click of a mouse and webcam, and have medicine delivered to your door by various apps and initiatives.
UnitedHealthcare is now offering virtual visits, giving members 24/7 access to PCPs and specialists via a preferred device. It drives down the cost of the “little stuff” and can help head off “big stuff.”
“Healthcare payers could protect patient safety and prevent medical errors by implementing health information technology. Payers could incentivize providers financially for adopting electronic medical records and e-prescribing systems.”
Here’s more, according to athenainsights: “While not suitable for situations that call for comprehensive physical touch, virtual visits can help patients cope with conditions and situations such as allergies, pink eye, sore throat, flu, colds, rashes, and fevers. The cost of a virtual visit is often less than $50 — far less than an office visit, according to UnitedHealthcare claims data.”
There are other ways using technology smartly can help reduce costs and enhance care. Insurers can use a cloud-based patient engagement platform like PatientBond to help engage health plan members throughout the year, not just at plan renewal time, to create a digital relationship and reduce voluntary turnover and motivate healthy behaviors. PatientBond is unique among such platforms because it uses psychographic messaging to customize communications based on members’ unique beliefs, motivations and preferences.
This efficiency in marketing drives down administrative costs, which can be redirected into improved care. The results of an enhanced digital relationship with members can provide eyebrow-raising results like a 55 percent digital engagement rate (3X manual phone calls) and a tenfold increase in Wellness Portal/Account Setup.
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