In the puzzle of healthcare benefits, is it possible to actually control your constantly rising costs? Yes, when you look beyond the traditional tips to do it. Here are the six missing pieces you need to solve the puzzle.
I recently came across an article advertising six tips for reducing healthcare costs in 2022 - and it got me thinking. Are we focusing on the true drivers of costs in our healthcare plans?
The article started by highlighting that healthcare costs have continued to rise year over year, with 2022 no exception. The experts are already predicting at least a 6.5% increase in medical expenses alone.
Experts are already predicting at least a 6.5% increase in medical expenses alone.
There is no doubt that healthcare and health insurance in our country have its flaws and prices have indeed risen tremendously over the last 20 years. It is also no surprise that these two industries are not well understood by most people and in the end, reading about how to reduce costs should have value. What struck me about the article is that the advice given is just the traditional tips, which is missing some of the key pieces of the healthcare cost puzzle.
Today, I'll break down the traditional advice and then share the six ways to actually help control your healthcare costs.
1. Identify what's really driving costs up in your plan
The first tip in the article was to pick an affordable health plan that addresses your unique needs. It went on to add that not all health plans are the same and when deciding on a plan, pick one that meets your budget and healthcare needs. I like to think of myself as a positive person, but when I first read that, I couldn’t help but laugh out loud. The number one advice is to pick a plan that you can afford! I’m sorry but isn’t that the same as telling someone that if they are going to grow tomatoes, make sure they get enough sunlight. How about addressing something that is more specific?
What if we took a step back and asked the question, what is causing my healthcare to increase in price every year and how do I set myself up to be the best consumer of healthcare? If we can address the actual drivers of cost, the price will naturally take care of itself. For example, what if you have a chronic condition that requires a monthly prescription drug and that drug costs you the employee $100 a month and your employer $5,000 a month. I think we can all agree that it would benefit everyone involved if you could get that same prescription for $0 and the company no longer had to pay anything either, come renewal time, that is how you earn a decrease in your premiums. Lower the prescription costs and premiums will follow.
2. Know your health plan terms
Next on the list was to brush up on health plan knowledge. They suggested that knowing what your health plan does and doesn’t cover is critical for reducing your overall spending. Understanding terms such as deductible, coinsurance, and copay can help you better understand your plan options. I agree that we should all know what a deductible is, but these terms basically have nothing to do with quality healthcare. If my deductible is $3,000 and I have a scheduled MRI, is it more important to know what my deductible is or the actual cost of the MRI prior to the appointment? If I have the option to pick a quality MRI for $800 vs $2,500, it is not hard to guess which one I am going to pick. Having the knowledge to be an efficient purchaser of healthcare is how I am going to save money.
3. Virtual healthcare options are not always the cheapest
The third piece of advice was to take advantage of virtual health options. Services like Telehealth and other platforms are essentially video calls with a doctor. This article states that these visits can be great for managing chronic conditions, speaking with mental health professionals and receiving diagnoses for minor ailments. Again, there is a lot of value with utilizing this service and in some situations, it makes a lot of sense. Unfortunately, there are plans that will charge a fee for utilizing this feature and the price can be more than the cost of seeing the doctor in person! The bigger question is what will happen if the doctor prescribes something or recommends a next step – how much is that going to cost?
Some plans charge a fee for virtual options that cost more than in-person care.
4. Quality scores are more important than the network
Fourth on our list is to stay in network. It is their recommendation that with health plans, your health insurance company partners with select providers to lower the costs of care. If you go elsewhere (out of network), you will not have these discounts. Again, all true but the concept of in-network vs out of network is largely outdated. When PPOs first came around and the negotiations were taking place, this was something to be aware of. Today, almost every doctor is in every network because they don’t want to be left out. Also, when you have a high performing health plan, they will treat any out-of-network doctor as in-network because the carrier has the flexibility to adjust as needed. The focus really needs to be on what does the procedure cost that I am scheduled to have and what are the quality scores for the doctor and facility that is performing my medical event. It doesn’t make a lot of sense to see an in-network doctor for a knee replacement that has only done a handful of them and charges $200,000 at a facility that is known for high reinfection rates.
5. Have a patient advocate in your plan
Number five states that we need to plan and budget our care. They suggest that at the beginning of the year, we think about potential upcoming healthcare costs we may have and then review our health plan coverages and budget accordingly. I absolutely agree that to be a good consumer of healthcare you need to have a plan. But how does one know what they are preparing for when it comes to an upcoming medical event. Who has that much time to figure out all the moving parts? What if you had an advocate that could help navigate that process with you? What if they were the ones that walked you through all your options? If you are left to do all the research and homework yourself, that is going to be a laborious task that may still produce very little value at the end of the day.
6. Get a second opinion
Lastly, our article says to ask questions. It advises that when visiting your doctor, don’t be afraid to ask questions. If you require care, ask them if there are comparable procedures or services that are more affordable while still being effective. Questions are good, but the right questions are better. Most people would shy away from a medical procedure they felt was second best, but don't feel comfortable asking for a second opinion. However, studies show 88% of people that seek a a second opinion walk out with a new or refined diagnosis.
88% of people that seek a second opinion walk away with a new or refined diagnosis.
What if you were able to gain a second opinion from a board-certified specialist in the area that is specific to your medical event? If you were diagnosed with cancer or a significant heart condition, you want to be sure that the diagnosis is correct, and the right treatment plan is going to be implemented. There is no room for cutting corners.
At the end of the day, there are many companies that are utilizing very creative and cost-effective strategies to not only change the trajectory of their employer sponsored plan, but who also set their employees up to be the very best consumers of healthcare. Unfortunately, there are lot of people that are continuing to subscribe to outdated and less relevant aspects to our current healthcare model.
If you are a company that provides insurance for your valued employees and if you are an employee that relies on the options that your employer sets up, you owe it to everyone involved to be sure that the right conversation is taking place because what you don’t know can have significant consequences.