How to Cut Health Care Costs Without Compromising Quality
According to the latest OECD Health Statistics, the U.S. spent roughly $10,300 on health care per person in 2016 – the highest expenditure in the world. Other nations of comparable wealth spent only half as much.
Despite spending so much more, patients in the U.S. generally do not achieve better outcomes. One culprit behind the trend is unnecessary care; according to the National Academy of Medicine, unnecessary care costs the U.S. about $200 billion annually.
Doctors want to do what’s best for their patients, and may be inclined to prescribe more care even where it has no measurable benefit, as long as it causes no harm. A little extra physical therapy can’t hurt, right?
But the cost of unneeded care does ultimately hurt consumers, including workers’ comp claimants, their employers, and the insurers who cover them.
Adhering to evidence-based medicine can help to eliminate unnecessary care, reducing costs without compromising the quality of outcome for the patient.
The Official Disability Guideline, published by the Work Loss Data Institute, is one of the most well-recognized clinical guidelines used in workers’ comp claim management, and has been shown to reduce lost-time, claim duration and medical costs.
Evidence Based Care: A Case Study
Consider the following scenario:
A patient just had surgery for total knee replacement. He is sent to a high-end facility for rehab, where he stays for two weeks. After discharge, he’s set up for home health physical therapy visits. After 16 visits, he receives a prescription for six more visits. He recovers well, and his care story seems like a success.
But was all of that really necessary, and did it really improve the patient’s outcome?
Consider the same scenario, but applying evidence-based care:
Instead of a high-end rehab, the patient is sent to a skilled nursing facility, which is far less expensive but provides the same services needed for his current injury and health status. Through frequent communication with the nursing staff, case management determines that the patient can be safely discharged after one week instead of two.
Since Texas adopted ODG in 2007, the state reduced lost-time by 34 percent, dropped medical costs by 30 percent, and subsequently decreased workers’ comp insurance premiums by 51 percent.
Rather than home health visits, outpatient physical therapy is recommended and approved. After his initial 16 visits are up, his progress is reviewed with the treating therapist, and it is determined that he is fully functional, and more visits are not warranted. Patient is discharged from PT with recommendation to return to work.
In this scenario, the patient rehabilitates his knee successfully while shortening the duration of his care by two to three weeks, saving tens of thousands of dollars of unnecessary care, and getting back on the job faster.
State experiences have produced real-life results. Since Texas adopted ODG in 2007, the state reduced lost-time by 34 percent, dropped medical costs by 30 percent, and subsequently decreased workers’ comp insurance premiums by 51 percent. The Ohio Bureau of Workers’ Compensation also reduced claim duration and medical costs by more than 60 percent within one year of implementing ODG in 2004.
Even in states with no formal utilization review process, care managers can reap these benefits by enforcing clinical guidelines through regular interaction with treating providers. Actively including clinicians in the direction of care increases accountability and establishes a collaborative relationship that keeps providers, case managers and patients on the same page.
Communication is critical to finding the best — and most cost-effective — course of action.