costs of care


Report: Inpatient Detox Costs Patients Ever More Out Of Pocket

Source: Health Care Cost Institute

Source: Health Care Cost Institute

Here’s some valuable national context for a hot local struggle over inpatient detox beds.

The local news, from the Boston Globe yesterday:

Brigham and Women’s Faulkner Hospital is modifying its plan for closing an inpatient drug and alcohol detoxification unit, after the proposal drew heavy criticism from patients, hospital staff, and mental health advocates who said the state has too few such specialized facilities and the change could harm patients.

“Sure,” I thought when I saw that. “Those attempted cuts fit with all you hear about mental health care as the neglected stepchild of other medical care, and substance abuse as the even more neglected stepchild of mental health care.”

But that’s just my lazy, impressionistic thinking. The quants with hearts over at the Health Care Cost Institute have just used their monumentally huge data sets of tens of millions of insurance claims to pin down what’s been happening lately with inpatient substance abuse payments. And I’d say they, too, found a certain stepchild factor, at least in terms of what patients must pay out of pocket.

Their new report says, according to the press release:

In 2011, out-of-pocket payments for mental health admissions more closely aligned with payments for medical/surgical admissions. However, the amount spent out-of-pocket on substance use admissions remained higher than payments for medical/surgical admissions. Out-of-pocket payments for substance use hospital admissions grew at twice the rate of out-of-pocket payments for mental health or medical/surgical admissions between 2010 and 2011.

The report also found that rates of inpatient detox had taken a major jump after the federal “parity” law, requiring health insurers to cover mental health similarly to physical health, kicked in: Continue reading

Mass. Health Care Shoppers Still Choosing ‘Nieman Marcus Hospitals’

Nieman Marcus in San Francisco (sjsharktank/Flickr)

Nieman Marcus in San Francisco (sjsharktank/Flickr)

If you buy all your clothes at Nieman Marcus, rather than at Banana Republic, TJ Maxx or Target, you’re spending a lot of money. Are the shirts, jeans or navy blue blazers that much better for four times the cost?

We almost never ask ourselves these questions in health care. We go to the most expensive hospitals in Boston for everything from an X-ray to a complex cancer treatment.

That habit means “the biggest hospitals have the highest price and get all of the payments,” said Aron Boros, director of the Center for Health Information and Analysis (CHIA). The result: We spend more money than we need to on routine care with no apparent benefit. The white shirt (say, a gall bladder removal) is of the same or better quality at Land’s End (your community hospital) as at Bloomingdale’s (a big Boston teaching hospital).

Boros just released the latest figures on the gap between hospitals that get paid very well in Massachusetts and those that are (barely) scraping by.

“This is more evidence that the market isn’t changing as rapidly as one would hope,” he said.

More evidence because this is the second report to show that four out of five health care dollars in Massachusetts go to half the hospitals, the most expensive ones. Continue reading

Why Not Educate Med Students About The Cost Of Care?

Dr. Neel Shah, an advocate for more transparency, value and rationality in the medical system, makes a persuasive case here that medical students are in dire need of instruction on how to think about the cost of medical care.

Dr. Neel Shah

Dr. Neel Shah

Writing for the blog “Wing of Zock” (if you’re not a doctor and don’t get the reference, click here) Shah points out that these days, physicians are compelled to consider costs through a variety of incentives, “top-down from policymakers who want more accountability in how we are using resources; bottom-up from patients who want more transparency in how we are spending their money.”

But, writes Shah, a chief resident in obstetrics and gynecology at Massachusetts General Hospital and Brigham & Women’s Hospital and the founder and executive director of the nonprofit Costs of Care, incentives are not enough. “We also need to give physicians the skills, training, and support they need to consider costs responsibly.” He continues:

Most physicians learn very little about health care costs during their training; in many cases, they are specifically taught not to consider costs while caring for patients. The traditional concern is that thinking about costs automatically means sacrificing the ingrained physician ethos to do everything possible for our patients. At the same time, many existing teaching methods may exacerbate the problem by embedding a “hidden curriculum,” leading to costlier diagnostic workups and rewards overutilization. Continue reading

Study: Hard To Shop For Hip Surgery, Even With $100K At Stake

(pasm/ Wikimedia Commons)

(pasm/ Wikimedia Commons)

As WBUR’s Martha Bebinger has reported repeatedly, it is hard, hard, hard to compare the price tags on medical procedures — even though the out-of-pocket costs to you could vary dramatically depending on where you get your care.

Now a new study in the journal JAMA Internal Medicine pins down this shopping problem for one particular procedure: elective hip surgery called total hip arthroplasty, or THA.

The researchers called hospitals around the country — and called and called and called, up to five times each — in search of the institution’s lowest price for a 62-year-old grandmother who lacked health insurance but could pay out of pocket. From the paper’s abstract:

Results Nine top-ranked hospitals (45%) and 10 non–top-ranked hospitals (10%) were able to provide a complete bundled price (P < .001). We were able to obtain a complete price estimate from an additional 3 top-ranked hospitals (15%) and 54 non–top-ranked hospitals (53%) (P = .002) by contacting the hospital and physician separately. The range of complete prices was wide for both top-ranked ($12 500-$105 000) and non–top-ranked hospitals ($11 100-$125 798).

Conclusions and Relevance We found it difficult to obtain price information for THA and observed wide variation in the prices that were quoted. Many health care providers cannot provide reasonable price estimates. Patients seeking elective THA may find considerable price savings through comparison shopping.

Oh, except, wait a minute, you can’t comparison shop very well when more than half of hospitals can’t give you their prices.

The latest health reform law in Massachusetts, passed last year, is supposed to address this problem and require greater price transparency from hospitals. Will it? Meanwhile, my friend Jeanne Pinder’s uses crowdsourcing to help consumers help each other gather cost data. She blogs about the new study:

This is one of our favorite topics. If you haven’t recently, go to our PriceMap interactive page and play around with the search; for a range of procedures, in cities all over the United States, we show you what the government is paying via Medicare, the program for the elderly and disabled. You’ll be shocked at the range.

Mass. Health Insurance Premiums Bounce Back To Highest In Country

(Source: The Commonwealth Fund)

Massachusetts is #1 again, but not in any way the state will celebrate. We have the highest health insurance premiums in the nation again, according to this annual report from the Commonwealth Fund. Massachusetts bounced back to the top again in 2011 after dropping to 9th place in 2010.

The report does not analyze why Massachusetts is back in first place, but notes that in general, health care costs are higher here because we have more generous benefits, our cost of living is higher overall, and our health care prices tend to be higher.

An important caveat: That high cost of living, and our higher incomes, need to be factored in. If you look at our premiums as a percentage of median household income, we’re actually on the low side: 18% compared to a national average of 22%. (See chart below.)

Still, this bump from 9th back to 1st is bad news. It’s also politically significant. Last year, hospitals and business leaders used this drop in health insurance costs (relative to the rest of the country) as proof that the market was working to curb health care spending. And, they argued, the drop to 9th place meant the state did not need to impose new controls. Leaders made this argument in the heat of legislative debate about what to include or leave out of the health care costs bill Governor Deval Patrick signed in August.

So what do those leaders say now? Continue reading

When The Full Sticker Shock Of Health Coverage Hits Our Family

medical bill

(Attercop311/ Flickr Creative Commons)

As the new state Health Policy Commission begins its work to bring down health care costs, here’s one Massachusetts family’s reminder of why the issue is so urgent. The excruciatingly high prices of both insurance and care mean that some must choose between health insurance and a new furnace, or health insurance and a car. This is not an abstract policy issue; it is a daily burden with major effects. One mother’s story:

By Sara Cushing
Guest contributor

A few weeks ago I resigned from my job as a project manager at one of the largest health care delivery systems in the United States. I have worked in different capacities in the health care industry in the Boston area for the last eleven years, but decided to leave my career because I wanted a change — to follow my dream of becoming a writer.

Many things needed to be considered about such a family-life-altering decision, including one that hadn’t been a concern of mine in the past: what my family’s next steps would be in purchasing health insurance. I have always carried the health insurance — a very robust PPO (“paid provider option”) family plan that was largely subsidized by my employer.

Sara Cushing

Writer Sara Cushing

The direct cost to me (paid bi-weekly on a pre-tax basis) was roughly $400 a month. In discussing my career departure with my husband, we knew that the monthly cost for a similar plan purchased through the Health Connector (the Massachusetts state agency that acts as a vehicle to allow uninsured residents to purchase health insurance through local health insurance companies) would likely be higher. Much higher.

Try something closer to $1700. About the same as our monthly mortgage. About half of what my take-home pay used to be — money that was no longer coming in. And we see no way around it.

Because my husband is in a higher income bracket we’re not eligible for subsidized coverage though the state; and because my husband is a contract employee, his employer doesn’t provide subsidized health care coverage.

This means that we’re looking at the same cost for a family plan whether we buy through his employer; the Health Connector; or through my employer’s COBRA plan (which allows me to purchase the same health care coverage as offered by my employer for up to 18 months after ending employment, though I am responsible for 102% of the cost — the additional 2% is for administrative fees).

I live in Massachusetts, where legislation was passed a few years ago mandating health care coverage for all residents. The legislation helped to create the Health Connector agency so that people could purchase health insurance in larger risk-pools instead of directly from health insurance companies, to allow for more competitive pricing and coverage options for individuals and families.

This all sounds great, right? What many people do not understand, however, is just how steep the monthly premium cost gets, just how painful a $1700 bite out of a family budget can be. Continue reading

Health Cost Panel: Complex Challenges For A Ref Who Can Only Blow Whistle

health cost commission

The new Mass. commission on containing health costs (Martha Bebinger)

As WBUR’s Martha Bebinger was on her way back from today’s inaugural meeting of the board of the new state Health Policy Commission — a key instrument of the state’s health-cost-containment law — she kindly fielded my interrogation: “So what struck you most?” Her reply, edited:

I’d say what stood out to me was that they recognized that the main focus of the law, the key element of the law, is setting a health-care cost-containment goal, but that it is going to be a pretty complex process, both to figure out what that goal should be and to determine the best way to reach it.

Board chair Stuart Altman said he feels like he’s a referee who can blow the whistle but not issue a penalty.

In the area of what that goal should be, what’s at issue isn’t just what the state economic growth is, but what it is over time. So it’s looking more at a trend than at a fixed number, and that’s a difficult concept for many people to grasp, both patients and providers.

We do know what the target is going to be for 2013, 3.6 percent. But this is really a question about the next four years after that, when it’s supposed to be right at the potential Gross State Product.

And then if you start to ask, ‘Okay, so what will it mean to get there?’ that’s when it really gets complicated. Because in the process of figuring out whether providers are keeping costs under control, the state is at the same time trying to overhaul the health care system with a focus on prevention. Continue reading

New Mass. Health Cost-Cutting Law Takes Effect Today

Stuart Altman of Brandeis University, chair of the new state Health Policy Commission

WBUR’s Martha Bebinger reports:

A state law that aims to limit spending on health care takes effect today. 

The law makes Massachusetts the first state to say that health care costs must stop increasing faster than that of most other goods and services.  

A new board that will set a health care spending target and track progress towards that goal has a chairman, and a first meeting date, but the members have not yet been appointed.  

More than a dozen other boards and commissions designed to improve care also exist in name only so far.  

Several provisions in the law take effect immediately or as soon as the state puts new guidelines in place. They include new restrictions on mandatory overtime for nurses, a requirement that providers offer end of life planning to patients nearing death and rules for the use of telemedicine.

There’s a nice recent summary of the law and its rationale here: How a new Mass. law can show the future of health reform.

Latest Data: Average Med School Grad Owes Over $166K

Know a virtuous young person who wants to become a doctor for all the right reasons? Think their soaring idealism might need a bit of ballast from financial reality? Here it is: The latest figures on medical school debt, just out today from the Association of American Medical Colleges.

The mean debt load for students from all medical schools is $166,750, up 3 percent from last year, and the median is $170,000, up 5 percent from last year. And it doesn’t much help if you go to a public medical school — the mean debt is about $156,000, compared to nearly $184,000 for a private school.

Depending on your repayment schedule, the new AAMC data show, your total repayment after graduating could total as much as $476,000. And we wonder why health care is so expensive in this country? Doctors’ salaries are of course only one element of our high price tags, but it’s an element that sets us apart from Europe, where medical education tends to be lower-cost or free. reported recently here:

Meanwhile, tuition rates continue to increase dramatically. The median cost of attending a private allopathic medical school has grown at 1.8 times the rate of inflation during the last 13 years. At public schools, it has grown more than twice the rate of inflation, the AAMC said.

Public medical schools have been particularly hard hit, as states have reduced funding in a poor economy.

Readers, what is to be done? See the full AAMC data below. One interesting note: 30% of graduates plan to enter loan forgiveness or repayment programs: Continue reading

Can My Company’s Wellness Program Really Ask Me To Do That?

doctor exam

(Wikimedia Commons)

“Wellness” is like apple pie, isn’t it? What could possibly be bad about companies helping their workers be healthier?

I wouldn’t dream of finding fault with many typical wellness offerings: Quit-smoking programs, on-site gyms, more appealing cafeteria salads. Good for worker, good for employer, everybody’s happy. But consider this email I received from an employee at a major national retailer:

I see you’ve written several articles about the new health insurance laws, etc. The company I work for has [a major national insurer]. Last year we received a $25 discount bi-weekly if we filled out a health questionnaire, which of course everyone felt compelled to do as that would be a savings of $650 per year. Most people I spoke to felt uneasy doing it, as they felt it would lead to other invasive practices. Well, sure enough, this year, if you DON’T smoke cigarettes you get $10 off bi-weekly, but to get the additional $25 not only do you have to fill out a questionnaire, but everyone employed [here] (and taking the health insurance) has to have a screening which involves:
1. Waistline measurement
2. Blood pressure measurement
3. Blood draw to test for glucose, HDL and triglyceride levels.
If you do not pass these tests, you will lose your $25 if these are not brought down to an acceptable level by August (when we will be tested again).
Needless to say, this really shook a lot of people up, as it is so invasive, and is this even legal?
Would love to hear your thoughts on this.

Let’s cut to the chase. Yes, it’s legal. And it’s a huge trend that began with only “carrots” — discounts on gym memberships, fun health fairs — and is now progressing to sticks. Or at least, to carrots that can feel a whole lot like sticks.

There are some important limits on what your company’s wellness program can do. More on that soon. But here’s the bottom line: Under federal law, your employer can vary your health insurance premium by up to 20 percent based on a “health factor;” that goes up to 30% as of 2014 and the government could eventually raise it as high as 50%.

Why should you foot the bill for all your Marlboro-packing, Miller-cracking, Big-Mac-chomping co-workers?

Readers, what do you think? On the one hand, if you’re a fit, non-smoking, careful eater, why should you have to help foot the bill for all your Marlboro-packing, Miller-cracking, Big-Mac-chomping co-workers? An unhealthy lifestyle is known to be a major contributor to health care bills. and health costs have skyrocketed for years, sending premiums through the roof, hurting businesses and costing jobs. Any levers to bring them down must surely be tried.

On the other hand, there is clearly a potential yuck factor here. Having my employer measure my waist, or draw my blood??? Getting weighed and monitored in the workplace setting, or in the personnel filing cabinet, may not always be comfortable. What if my boss starts a “fun” pedometer contest among our company’s departments and I’m the morbidly obese one? What about my medical privacy? Continue reading