Using Care Options Appropriately to Manage Cost for the Employer & Employee

February 2, 2023

Using Care Options Appropriately to Manage Cost for the Employer & Employee

When Ya Gotta Go, Ya Gotta Go. But Where?

Healthcare costs are soaring for both employers and employees. The numbers below indicate that hospital spending, physician services, and prescription drugs are among the key drivers.

Knowing which care options to use and when can help manage healthcare costs for employers and employees.

Projected growth for three drivers of healthcare costs: (Average annual increase through 2030)

Hospital Spending: 5.7%
Physician and Clinical Services: 5.6%
Retail Prescription Drugs: 5.0%

With each one of these areas projected to increase through 2030, managing costs is critical. Fortunately, optimizing different care options can help rein in health spending for organizations—and their employees.

How? Leverage lower cost sites of care

Hospital utilization for non-life-threatening emergencies continues to drive up spending. In fact, using the ER is the most expensive option for receiving routine care. Alternate options, however, including urgent care facilities and telemedicine can provide lower costs for certain types of treatments because they operate with lower overhead, taking unnecessary costs out of the system.

Understanding which options can deliver the most appropriate type of care and which services to have performed where can be key to containing costs. Let’s take a look at which care option should be used for your needs to help keep costs down.

1. Urgent care facilities, walk-in clinics & telemedicine

Non-life-threatening symptoms, such as: eye/ear infections, colds, flu, congestion, fever, allergies, bug bites, skin rashes, flu shots, sprains/strains, vomiting, diarrhea, stomach pain, painful urination, annual physicals, and vaccines. The average cost of an ER visit can be $1,400. But a trip to an urgent care facility for the same treatment may only cost about $100-150 on average.

Expand Telehealth for a Broader Range of Health Services

Expanding telehealth offerings beyond general wellness visits can provide more cost-effective and convenient options for a wider range of health services, including mental health, behavioral care, primary care, and emergency services.

For employers and employees alike, the savings can be significant. Making health services accessible virtually can help to limit employee time away from work and in turn, help employers regain approximately $3,600 per employee every year in lost productivity due to off-site doctor appointments. And employees can save almost 50 percent over a traditional in-person appointment.

2. Imaging centers

Radiology services, such as: MRIs, x-rays, CT scans, ultrasounds, mammograms, etc. Diagnostic imaging can cost up to 75% less at an imaging center versus at a hospital.

3. Infusion centers

Specialty drug treatments through either injection or IV. These centers can cut costs for specialty meds by at least 50% versus going to a hospital.

4. Ambulatory surgical centers

Non-complex, outpatient surgeries, including: routine colonoscopies, hysterectomies, and certain musculoskeletal procedures. Ambulatory surgery centers can lower costs for hospital outpatient procedures by 59%.

5. Hospital ER

Any medical condition that may be life-threatening and require fast or advanced surgery, including: chest pain, difficulty breathing, stroke, fainting, burns, head injury or concussion, eye injury, seizure, bleeding associated with pregnancy, etc.

Communicate navigation and concierge services

Many employers offer health navigators or concierge services as part of their health offering, but it is important to communicate the value these navigators provide at the time care is needed throughout the entire year. Help members understand that by intervening before a service or prescription is ordered or a claim is filed, health navigators can make recommendations for receiving an optimal and cost-effective level of care and can help avoid decisions that could end up costing more. For instance, if a patient needs an MRI, a navigator can direct him/her to a free-standing imaging clinic, where the cost can be lower than a hospital for the same service.

This material has been prepared for informational purposes only. BRP Group, Inc. and its affiliates, do not provide tax, legal or accounting advice. Please consult with your own tax, legal or accounting professionals before engaging in any transaction.