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Phia Group Media


Spending to Save

By: Ron E. Peck, Esq.

I have on more than one occasion made mention of the fact that my wife is a relatively recent survivor of Non-Hodgkins Lymphoma. I’ve brought up in past webinars, podcasts, and articles her harrowing battle – and eventual triumph – against cancer.  Just as I have on more than one occasion referred to this chapter in our lives, likewise on more than one occasion I have been asked how it felt to be dependent upon – and at the mercy of – the medical service providers against whom – in our battle to contain costs and preserve plan funds – I am often pitted. Such a question belies a core misunderstanding. It reflects a belief that to contain healthcare costs, payers must avoid healthcare. I believe, however, that this simplistic approach to cost containment is a recipe for disaster.

During the early days of the COVID-19  pandemic, patients were driven by fear to avoid hospitals, as those facilities were inundated with victims of the coronavirus. As a result, chronic diseases went untreated and complications arose. Early signs of catastrophic diseases – which (if caught early) could be dealt with – went undiagnosed. In those early days, many health plans and carriers enjoyed a substantial drop in claims (aside from COVID claims), and thus enjoyed a substantial increase in savings. It appeared, for the time being, that avoiding healthcare meant containing costs. Yet, analysts from every sector theorized that once patients resumed visiting providers, we would see an enormous uptick in costs, driven in large part by those diseases that – had they been diagnosed earlier – could have been treated in less invasive (and thus less costly) ways, but now required far more costly intervention. They were right. Complications, advanced stage diseases, escalated illness, and risk… These are now some of the many scars left by the pandemic. As for the savings payers enjoyed when patients avoided care? Those savings (and more) are now at risk, as these payers must pay to treat catastrophic complications that could have been avoided with earlier intervention and health care.

As a spouse of someone with cancer, I viewed our personal interests and those of my health plan to be aligned. If my wife’s cancer is misdiagnosed, her cancer will grow unchecked. It will result in her receiving ineffective treatment. Treatment meant to target a disease she doesn’t have. Both result in a worse prognosis for her, and both result in more costs for the plan. If, however, the cancer is properly diagnosed and the proper (effective) treatment is administered, the aforementioned additional – yet worthless – costs associated with misdiagnosis are avoided. 

Of course – both payers and patients must be vigilant when it comes to reviewing claims.  Monitor bills for unscrupulous practices. Keep excessive charges in check. Be on alert for fraud or abuse. Identify and pursue primarily responsible payers and liable parties. Take action before, during, and after treatment to secure the highest quality care for the lowest cost (without diminishing the quality of that care). Incentivize intelligent patient behavior to avoid waste and unnecessary expenses. 

Yet, keep in mind that not all providers are “the enemy.” Providers who are able to identify, treat, and eliminate disease in a timely, efficient, and effective manner create savings! As payers and those who service them, we should reward these providers. We should celebrate anything – be it training, technology, or research – that advances these efforts. 

With this in mind, I believe it behooves payers to identify those providers who provide reliable, quality care. Incentivize patients to use those providers. Their successful outcomes from a health perspective – more often than not – translate into better cost containment outcomes as well.  Further, fund research meant to enhance treatment options. Of course, I – like you – am horrified by the exorbitant price tags attached to so many new treatments, medications, and “specialty drugs.” Yet, looking past those bad apples, consider how much payers would save long-term if (for example) cancers can be diagnosed more quickly and accurately. How much payers would save if the first treatment provided (and paid for) is the right treatment. 

I believe we must end the narrative of “payers versus providers” and instead promote the narrative of “good payers and good providers versus bad payers and bad providers.” 

I have seen – whilst serving our clients – what ineffective oncological care can cost a health plan.  I also experienced firsthand what expedient, effective oncological care cost our self-funded health plan. We paid less and enjoyed better results – payer, provider, and patient alike. Cost containment and quality health care can coexist.