When the doctor’s office is closed and your sore throat or sprained ankle is still bugging you, it’s great to have a convenient way to get care. But that “convenience has a cost,” warns the PwC report on Medical Cost Trend: Behind the Numbers 2017.
The PwC Medical Cost Trend report calls convenient care an “inflator” of medical cost trend because it has led to higher utilization of health care.
At first glance that seems contradictory, since we know urgent care and retail clinics cost less than the emergency room. But even if each visit costs less, higher utilization can more than eat up the savings and create a net increase in health benefit costs.
More Clinics, More Utilization?
That pattern was revealed in a Health Affairs study released in March 2016. The study covered care for “low-acuity conditions” among three million insurance company customers between 2010 and 2012. Urinary tract and sinus infections are examples of the 11 low-acuity conditions included in the study.
The study found that 58 percent of retail clinic visits were due to new utilization, while only 42 percent were substitutes for other, more expensive forms of care. For retail clinic patients, that translated to an increased cost of $14 per person per year for caring for minor medical conditions.
Meanwhile, the number of clinics continues to increase. The PwC report notes there will be more than 3,000 retail health clinics in the U.S. by 2017. In addition, there are 9,300 walk-in, stand-alone urgent care centers, with another 50 to 100 new clinics opening their doors each year.
That’s a lot of access to care. And consumers are taking advantage of it, especially young patients who favor easy access to care at a retail or convenient clinic site over waiting for an appointment at the doctor’s office. As the PwC report puts it, “ubiquitous locations and convenient access is increasing utilization and incrementally inflating medical cost trend.”
Exploring ‘Inflators’ and ‘Deflators’
You’ll have a chance to hear PwC’s Benjamin Isgur discuss convenient care clinics and other “inflators” and “deflators” of medical cost trend at our Alliance Learning Circle on Dec. 13.
Isgur leads PwC’s Health Research Institute (HRI). HRI is a dedicated research group that provides new intelligence, perspective and analysis on major health-related business issues. At the Dec. 13 event, he’ll explore the medical trend report, including advice for employers.
The event also includes:
- The Alliance Benefits Roundtable where you can network with peers and share what you’ve learned about plan design, cost sharing and other issues.
- A presentation on the Alliance 2016 Annual Benefit Survey Report, which collected information about more than 395 plans from more than 180 employers.
Be a Better Health Care Consumer
The PwC report says that benefit design, including cost sharing with consumers, could help fix the convenient care issue.
In the meantime, employers can work to help consumers understand how to make better use of the health care system. The Alliance can help with its presentation and booklet on “How to Be a Better Health Care Consumer.” I’m happy to talk with you about bringing these insights to your workplace.
Mike has a strong background in health benefits and self-funding. He previously served as a regional sales advisor for Digital Benefits Advisors in Madison, Wis., where he managed the health benefits for more than 160 credit union clients across 14 states. Prior to that position, Mike worked at CUNA Mutual Group in their employee benefits division for almost 10 years as an employee benefits sales specialist.
Mike has a bachelor’s degree with a double major in marketing and business administration and is licensed in both health and life insurance in Wisconsin, Illinois, Iowa, Minnesota, Nebraska and Montana.
Read blog posts by Mike.
Latest posts by Mike Roche
- Diving into the Details: Captive Comparison, Analysis & Value - June 5, 2018
- What’s Your Risk Appetite? - May 22, 2018
- Video Aims to Answer Key Captive Questions - April 10, 2018