When it comes to worker health benefit choices we make each year, we have been programed to think…
“First I have to make sure my local hospital is in the plan’s network.”
Is this really as critical as we have been led to think (and worry) about?
Consider these five important dynamics, drawn from analyzing healthcare consumption of 200,000 consumers over 12 months:
1) Hospitalizations are rare: 95.5% of us WILL NOT have a hospitalization even once in an entire year. Of those that do have a hospitalization, nearly half will spend two days or less in the hospital.
2) Out-patient hospitalizations are less common than we fear: 61% of us WILL NOT have a single outpatient service in an entire year. Of those that do, nearly half will consume less than $1,000 in hospital services in the entire year.
3) Emergencies are uniquely handled: Of the small portion of working families who access hospital based services sometime during the year (from #1 and #2 above), nearly a third of those relate to “medical emergencies.” As such, they must be treated as though they were IN-NETWORK. And in such instances, you or your family member have only one focus – get to a place of emergency care fast. You are not penalized for that.
4) Non-urgent or planned service needs create options: So that leaves a small slice of services where we are able to plan and schedule hospital services, such as non-emergency surgeries, regular chronic illness care, non-routine diagnostics, etc. In these cases, patients will be influenced by the treating physician, who often can treat in multiple settings and may have an opinion on which would be the most appropriate for the particular need. Patients in this situation often have time to do some research on their own and be part of that decision.
5) Hospital point-of-care negotiations can settle patient balances today: The average plan deductible is three times what is was 10 years ago for employer sponsored benefits according to the Kaiser Family Foundation and even more for individual plans. The report indicates that 57% of workers have out of pocket exposures of $3,000 or more. A direct result is exploding unpaid balances and delinquencies for hospital patient balances. Crains reported last year $1 billion in uncollectible hospital debt for the 10 largest hospitals in the Chicago area, asserting its relationship with patients struggling to pay costs associated with these high deductible plans. Many programs, including those from new models like Hixme now negotiate to help settle these balances at a discount. This new Point-Of-Care Negotiation and Settlement dynamic will be an increasingly important part of controlling care costs.
For all these reasons, care needed during the year may or may not occur with the “local hospital” that drove health plan or coverage level decisions at the beginning of an employer’s plan year. Perhaps that one consideration overwhelmed many other important considerations.
So in reality, the question about whether or not a local and familiar hospital is IN or OUT of network may well turn out to be less of an issue for many workers and their families than many other coverage and affordability considerations.