Don’t be narrow focused on health care reform

I work in the health care industry and have worked in the health care industry for the last 4 years, minus a stretch of unemployment. I first worked for a medium company whose target market was small and medium clinics, and now I work for a large corporation whose target market is larger clinics and hospitals.

One thing that I’ve come to observe is how short-sighted the thinking appears to be on health care. There is a lot that is not being taken into consideration by those who seek to overhaul 1/7th of our economy. In my opinion it is currently immaterial whether the target is a single-payer system, because they are aiming at changes that don’t target the real causes of the increased health care costs.

Currently if you have insurance, when you visit a physician you receive from your insurance company a document, similar to an invoice, called an Explanation of Benefits (EOB) which outlines the charges from your recent visit and how much was paid by the insurance provider. Your EOB will likely show two prices for each listed charge: the price normally charged by the physician’s office, and a discounted price. The discounted price is the price that the physician agrees to charge patients with a particular insurance plan.

This is why there is a push to get everyone on insurance of some kind: the discounted rates mean that everyone pays less overall. For individuals without insurance, the discounted rates don’t apply, meaning that basically 47 million people are left with a full tab after a doctor’s visit that they have to pay on the spot or make arrangements to pay. If the person is indigent or meets certain qualifications, the government will pay the bill through one of several programs, or there may be private charities that can provide assistance. Again, though, there is no discount applied to the rates.

Part of the problem in this country when it comes to figuring out how to reform the system is that few actually understand how insurance actually works. Actually I would say that is most of the problem. For most covered individuals, there will be no problems when a billing statement is sent from the physician’s office to the insurance company. The insurance company will pay on the claim, you’ll receive the EOB in the mail, and everything goes on as normal.

Part of this lack of understanding is the patient not understanding their insurance benefits. For visits to a clinic, things tend to be relatively straightforward, even when you see a specialist for a consultation. It’s when you need treatments targeting a specialized diagnosis that you need to start reading the fine print on your insurance policy — and the problem is that few actually do. For example, I have psoriasis. Treatments can come only through one source: a dermatologist. Treatments targeting psoriasis range from the relatively inexpensive over the counter treatments that may or may not work to expensive prescriptions (even with my insurance coverage).

Then there’s the physician-side of things, namely the billing process. One of the leading causes of billing problems at hospitals and physician offices is incorrect billing and/or insurance information provided by the patient. Billing problems increase health care costs because they delay payment to the clinic or hospital and increase administrative overhead. Billing problems are also completely preventable, and most are caused by patients — something you won’t hear from health care reform advocates. The clinics and hospitals aren’t in the clear on this, either, as clinics and hospitals will have administrative issues, same with insurance companies (and practically every company with an accounting department). However the cost of their administrative issues are still passed on to their single revenue source: the patients.

This comes down to increasing efficiencies within the clinics and hospitals, as well as the insurance companies. Reduce administrative overhead and administrative errors and issues, and you reduce costs at the same time. This is why there is a push for electronic health record (EHR) systems at clinics and hospitals: they have been shown to reduce errors in the heath care setting, including administrative errors.

However you can’t completely prevent patient errors, which is another reason why a lot of people want a single-payer system. In a single-payer system, patient errors are all but eliminated when it comes to billing. The only thing you have to provide is an account number and some other identifying information — but then again, you’d probably not be surprised how often even just this basic information causes billing issues.

A secondary problem associated with billing that also keeps health care costs up is that most individuals don’t thoroughly review their EOB or billing statements when they receive them. Just like you should not pay for any other services you don’t receive, your insurance company should not pay for services the clinic did not provide to you. These billing and administrative errors need to be corrected, so be sure to go over every statement you receive regarding visits to clinics and hospitals to verify everything is reasonably accurate.

One other thing you can do as well to reduce health care costs: pay out of your own pocket when you can afford to do so. When you pay your co-pay at the front counter at the clinic, ask them the total amount of the bill. If they say they won’t know until their accounting or billing department sees the paperwork from the visit, ask them to bill you first and you’ll make the determination then of whether to bill the insurance company. I actually did this on my most recent doctor visit, and what they quoted me wasn’t affordable, but at least I gave them the chance to avoid billing the insurance company.

Note that billing the insurance company is quite different than notifying the insurance company. If you have an insurance plan with a deductible, always have a statement sent to the insurance company so anything you pay out of pocket is credited against your deductible.

When you pay out of pocket as opposed to billing the insurance company, you help reduce the clinic’s administrative and overhead costs. If more patients did this, imagine how it would start adding up. Now I know that for visits and consultations with specialists, this may not be entirely realistic — my most recent visit was with an Otolaryngologist (ear, nose, and throat) and the laryngoscopy alone was $150 (not to mention about 1 1/2 hours with numb nasal passages), plus I was additionally billed for the clinical consultation.

However I also had two consultations with a dermatologist about three years ago, and the total billed amount for each consultation was under $60. Had I had the foresight to ask what the billed amount would be, I would’ve paid it in full without them having to bill the insurance company.

I am against the current health care reforms for the single reason that this is not being completely thought out. Everyone involved in the legislative process thus far has been very short-sighted and narrow-focused, even with several practicing physicians in both houses. And with what is at stake, we cannot afford to be short-sighted and narrow-focused on reforming health care.