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Who Should be Held Accountable for Healthcare Costs?

About one-half of healthcare leaders and clinicians said providers are not accountable for total cost of care, but payers and pharmaceutical companies are, a new survey found.

Healthcare costs and patient financial responsibility

Source: Thinkstock

By Jacqueline LaPointe

- While the recent growth in patient financial responsibility has providers thinking about healthcare costs when making care decisions, many still do not think they should be held accountable for the costs of care, a recent survey showed.

A new NEJM Catalyst Buzz Survey, sponsored by the University of Utah Health, asked the NEJM Catalyst Insights Council, a qualified group of healthcare executives, clinical leaders, and clinicians, about their views on healthcare costs and patient financial responsibility.

Respondents unanimously agreed that out-of-pocket costs are important to patients, and the majority said that when making clinical decisions, they consider the cost to the practice or health system (76 percent of respondents), out-of-pocket costs (72 percent), and total cost of care (68 percent).

Chart shows most healthcare leaders and clinicians consider healthcare costs and patient financial responsibility while deciding on patient treatment options.

Source: University of Utah Health and NEJM Catalyst

Over 60 percent of the physicians also reported that they are responsible for educating their patients about healthcare costs.

READ MORE: Key Ways to Boost Collection of Patient Financial Responsibility

However, almost one-half of the respondents said they should not be held accountable for total cost of care.

Clinicians were the most likely to believe they were not accountable for healthcare costs, with 53 percent, followed by clinical leaders with 44 percent and healthcare executives with 32 percent.

“Physicians should definitely be aware of the charges generated by the treatments or prescriptions they recommend,” Mark Melrose, DO, Chief of Emergency Services at NYC Health + Hospitals’ North Central Bronx Hospital, stated in the survey report. “Maybe they aren’t responsible for the actual cost, but they should be aware of the way they are contributing to the cost of care to a patient.”

Instead, respondents pointed their fingers at payers. Eighty-one percent said that payers, health plans, and HMOs had the strongest impact on cost of care, coming in second behind pharmaceutical and biotech companies.

About three-quarters of the participants also found hospitals, health systems, and physician organizations as having the greatest impact on healthcare costs.

READ MORE: 3 Strategies to Decrease Low-Value Care, Healthcare Costs

Chart shows that healthcare leaders and clinicians believe pharmaceutical and biotech companies, as well as payers, have the greatest impact on healthcare costs.

Source: University of Utah Health and NEJM Catalyst

But just 28 percent of healthcare executives, clinician leaders, and clinicians felt individual clinicians had a strong effect on cost of care.

Even fewer thought employers (26 percent) and patients (23 percent) made an impact on healthcare costs.

Robert Glasgow, MD, Vice-Chair of Clinical and Quality Operations for University of Utah Health’s Department of Surgery, explained that it can be easy for providers to lose accountability when it comes to healthcare costs and patient financial responsibility.

“Physicians don’t set pricing for insurance, and we can’t determine the price of a drug or a new technology, so it’s easy to feel powerless when it comes to impacting costs,” the Chief Value Officer for the Department of Surgery in Salt Lake City said in the report. “In an ideal state, all stakeholders would be accountable for costs.”

READ MORE: Managing Healthcare Costs, Data Analytics Top C-Suite Priorities

Healthcare leaders and providers identified several barriers keeping doctors and other care providers from addressing healthcare costs and patient financial responsibility with their patients.

The payer environment was the greatest challenge, according to the survey. Ninety percent of respondents agreed that healthcare costs are too confusing with the current payer mix.

Patients undergoing the same procedure may have different costs based on their insurance coverage. Providers must understand a wide range of payer rules and requirements to truly give their patients the right healthcare cost information, but this is a challenge when providers are busy delivering care.

Approximately 86 percent of participants stated that clinicians do not have the skill set to discuss healthcare costs with their patients.

Clinicians also felt that they did not have enough time to have cost discussions with patients. About 64 percent reported not having the clinic time to go over treatment costs with patients.

Finally, 78 percent of healthcare leaders and providers said the tools needed to estimate costs and patient financial responsibility are just not available to their clinicians, and 77 percent reported that the tools were not even available at the health system level.

Chase Coffey, MD, MS, SFHM, FACP, Associate Chief Medical Officer at LAC+USC Medical Center, told researchers that he hopes a technology will emerge that condenses a patient’s insurance information, drug formulary, and other relevant details.

Currently, most providers are left with pages of insurance company manuals to sift through.

However, INTEGRIS Health in Oklahoma claims to have a tool that helps patients understand their healthcare costs. The health system developed a price estimate tool that provides 240,000 prices for outpatient procedures each year. The estimates are between three to five percent of the final charge.

Accurate price estimates prior to care delivery helped to boost point-of-service patient collections at the health system from $1 million in 2008 to $18 million in 2015.

However, health systems like INTEGRIS Health may be few and far between. A recent JAMA Internal Medicine study found that just 21 percent of hospitals had the ability to provide a complete price estimate for a common surgery.

Even worse, the percentage of hospitals that could provide complete healthcare cost information to patients dropped from 48 percent in 2012.

But even if a health IT tool came along, Glasgow from the University of Utah Health still thinks physicians need to be trained on how to have patient financial responsibility and healthcare cost conversations with their patients.

“The doctor-patient relationship should never be seen as a business transaction,” he told researchers. “We need to train physicians to give patients enough cost data. That’s the starting block of high-value care.”

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