It's the start of a new benefits year for most employers, and workers are only beginning to tap into their companies' offering of 2012 healthcare coverage. However, they can expect to face rising healthcare costs and be asked to pay larger co-pays and deductibles than ever if recent years are any indication.
A September 2011 U.S. Government Accountability Office (GAO) report found that from 2006 to 2010, the percentage of covered workers enrolled in high-deductible health plans increased from 4% to 13% and the percentage of covered workers with a deductible of $1,000 or more for single coverage nearly tripled, from 10% to 27%. Meanwhile, overall U.S. healthcare spending has increased by an average of nearly 7% per year, from $1.4 trillion in 2000 to $2.5 trillion in 2009, according to the GAO report.
With the economy ailing, most consumers are looking to stretch a buck, including their share of healthcare spending. Finding price comparisons for care can be helpful. But although there are a variety of federal, state, and private efforts to provide better healthcare-cost transparency to consumers, tracking down this data isn't easy for most consumers, said the GAO.
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Contractual terms between healthcare providers and payers that restrict disclosures of negotiated rates also complicate consumers' ability to find cost information, said the watchdog agency.
Among the small-but-growing set of private companies that are providing healthcare cost information to consumers are payers such as Aetna, which lists cost comparisons on a portal, and technology vendor Change Healthcare, which offers data analytics and Web-based services to employers--and their workers--and health plans.
Change Healthcare aims to ease the hunt for price comparisons by reaching out to individuals with information that's personalized and relevant to them, according to Change Healthcare president Doug Ghertner, who joined the private company six months ago from CVS Caremark.
"There are other look-up tools out there, but with our tool, you don't need to seek out costs," he said. By collecting and running algorithms against claims data, Change Healthcare "looks at what an individual is paying [for healthcare services and products], looks to find where these services and products are available for less, and then reaches out to individuals saying, 'you can save X dollars a year,'" said Ghertner in an interview with InformationWeek Healthcare.
For Change Healthcare clients, workers receive "personalized, timely and relevant" alerts by text or email, allowing them to go onto a portal and check out, for instance, a list of pharmacies in their area where they can refill a maintenance medication, such as allergy or gastric reflux pills, for less than they're paying now, said Ghertner.
Change Healthcare provides information about dental, medical and pharmacy products and services, "helping to maximize health plans once you make your purchase," he said. "We scan claims data monthly, always looking for savings opportunities," he said. That can range from less-expensive pharmacies for prescription medications to less costly medical testing.
"We see tremendous amount of opportunity [for savings] in physical therapy, dental, chiropractory, mental health, and medical imaging," he said.
"A CT scan might cost $538 or $6,000," depending on whether a patient in a particular region goes to a hospital, outpatient facility, in-network, or out-of-network provider for the test, he noted.
Among Change Healthcare's clients is Pinnacle Financial Partners, a full-service bank in Tennessee that has 32 offices and 770 employees. Pinnacle frequently has been named by local media as one of Tennessee's best and healthiest employers in the region, said Rachel West, Pinnacle's chief people officer in an interview with InformationWeek Healthcare.
The average age of a Pinnacle employee is 48, and most have at least 10 years of industry experience, she said. But with experience and age, so too come some added risks: The maturity of Pinnacle's overall workforce "puts us at a category of higher risk" when it comes to healthcare needs and costs, West said.
With that in mind, Change Healthcare's services are helping Pinnacle address two of its biggest goals, creating a healthier workforce and helping employees be better consumers of healthcare, she said.
"We try to look at tools all the time to help employees meet our goals," she said. By making Change Healthcare's tools available to employees, they hope to educate workers about health, and not to force them to make choices based just on costs, she said.
"If something is priced three times higher than a price offered elsewhere, you want to consider that, be educated about that," she said. Pinnacle employees have three health plan options, including a PPO and two high-deductible plans, she said. "The total cost is where this tool is valuable," she said. "All our employees own a piece of Pinnacle, so there's motivation to keep healthcare costs lower," she said.
Although West declined to disclose dollar figures, she said Pinnacle already has saved more than the cost per employee to use the Change Healthcare service. "It reduces the cost of our health plan overall by identifying savings," she said.
Pinnacle has offered the Change Healthcare services to employees for nearly a year and has found that so far, about half of its workforce has used the tools to at least look at some of the changes they could make when they've received alerts.
Pinnacle also has worked with Change Healthcare to make some changes in its services' features. For instance, Change Healthcare implemented some of Pinnacle suggestions, such as adjusting the standard mileage for employees considering less-expensive healthcare products and services.
For instance, in order to see a specialist, employees might be willing to drive farther for a medical appointment than they would be willing to drive to pick up a cheaper prescription at a drug store that's farther away, said West. "A lot of people aren't willing to travel farther than five miles for a drug store, but you might drive farther than 25 miles for a doctor," she said.
Change Healthcare typically contracts with self-insured companies and health plans, collecting claims data, adding other data sources, normalizing the data, and then running algorithms that allow Change Healthcare to calculate saving opportunities and send personalized texts or emails to individuals about where they can get these cost savings, Ghertner said.
Once individuals receive alerts, it's their choice to check out Change's portal to look at the saving opportunities. If the member chooses not to act on the opportunities, Change Healthcare will ask why. Reasons might include an unwillingness to drive farther for prescriptions.
Typically, Change Healthcare offers the services to all their clients' employees, who may choose whether to receive the alerts or opt out, he said.
"If you or I have a prescription to fill, we probably won't call around to pharmacies asking for price, we'll just go where it's convenient," said West. "But if you start doing research you'll often find a lot of variances of costs between drug stores that aren't much farther to drive to," said West. With the automatic alerts and price information provided by Change Healthcare, tapping into healthcare savings is easy, she said.
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