Everyone will agree that emergency care is a necessary and important part of the US healthcare system. Timely access to emergency care is undisputed. The role of the ER is undermined, however, when used for non-emergent care that can be safely rendered elsewhere. A recent report by Accenture examined one of the root causes of ER overuse: “low healthcare system literacy.”1 Meaning that due to the extreme complexity of the healthcare system, non-emergent primary care sought in the ER for “non-life threatening” conditions is largely due to individuals who either cannot navigate the system of in-network and out-of-network doctors or simply opt for the convenience of an always-open ER that never requires an appointment. Whatever the reason for overuse, the practice amounts to $47 billion in “avoidable medical spend for US healthcare each year,” according to the report.
Our country continues to battle COVID-19 surges and staffing shortages which in some cases is bringing an already overused ER system to a breaking point. Although ER use dipped during the initial height of the pandemic by some 42% according to the CDC2 and the percentage of ER visits from patients diagnosed with COVID-19 is below the two peaks of over 7% experienced in 20213, COVID related staffing shortages remain. In fact, Moody’s released a report last month which predicted labor shortages will plague hospitals through 2022.4 That means now more than ever patients abusing or overusing the ER need to be re-directed to care in the proper setting – a problem that will improve healthcare outcomes, save lives, and save money.
For years prior to the pandemic, self-funded employers have struggled to keep rising healthcare costs at bay. One area of waste in their healthcare spend is unnecessary emergency room use. In particular, a large part is due to so-called “superusers” who may, in fact, be those who lack literacy about the healthcare system. Addressing the problem now can have a direct impact on the quality of care for employees and/or their dependents who maybe using the ER inappropriately. Self-funded employers can help members receive care in the right setting by leveraging the processes that likely already exist through the plan administrator. Given the potential savings and positive patient outcomes which can result, employers are wise to identify and mitigate ER abuse and overuse.
How do self-funded employers know they have a problem?
Working with large employers across the country, we have uncovered ER overuse repeatedly in plan after plan. In most cases, it is a small percentage of users driving up costs. I see not only the potential for substantial cost reductions for employers, but the benefit of shifting habitual ER users to more appropriate settings that will improve health outcomes.
The scope of ER overuse is highlighted in some recent sample findings from self-funded employer plans. These patients were separated out from higher risk patients such as those with cancer, high-risk pregnancies or other conditions that may require more frequent ER use. A few examples include:
- A 47-year-old member with a history of opioid dependence visited the ER 82 times within two years mostly due to migraines. The visits accumulated more than $250,000 in plan cost.
- A 22-year-old member visited the 14 ER times from 01/01/20-03/31/21. She was previously identified for her over usage of the ER for non-emergent issues as well as receiving the majority of primary her care through the ER. She is established with gynecology and most recently with endocrinology however appears to continue to overutilize the ER. There have been over $177,000 in ER costs related to this patient.
- A 32-year-old female member has been to 6 different ERs, 12 times ranging from 11/4/20-4/6/21. All of these visits were related to abdominal pain, gastroparesis, or diabetes mellitus. While she did see a gastroenterologist once in 12/2020, she has not followed up nor appears to be established with a primary care doctor. There have been over $165,000 in ER costs related to this patient.
Putting dollar amounts to the patterns like the ones shown above truly brings the problem into focus for plan administrators. Going back to the Accenture focus on healthcare literacy, if more individuals understood the costs difference in ER care, it could impact their decisions to seek care there. When accumulated over time and over several superusers, the costs of ER use can amount to millions of overspending for a self-insured company. Two different reviews of plan sponsors’ employee healthcare claims found ER overuse resulting in more than $1.1 million in each of the plans. A third employer plan review found more than $545,000 in overspending because of ER abuse.
Effective intervention may have been able to substantially reduce the spend for these members while providing them with the care they needed from providers who could manage their conditions and provide long-term care plans. As a physician, when I see cases of ER overuse, I am most concerned about the potential harm these patients are doing to themselves by not seeking the proper care at the proper place. When employers work with insurance case management to intervene, it helps both sides and has been proven to be effective. It will also keep patients not needing emergency care out of the ER at a time when staffing shortages are likely to continue beyond the pandemic.
So how does intervention work for self-funded employers?
The first step is to identify members with frequent the emergency visits not related to significant illness or specific chronic conditions. Often the plan administrators are not aware of these patients themselves. The entire claim history is then reviewed by a clinical team that scours the data looking for a reasonable clinical explanation for the use patterns. If one is not found, a unique plan of action is developed based on the claims data. This is brought to the attention of the insurance case management team. Together we work to ensure members receive appropriate care from primary care physicians and specialists, when appropriate, in the outpatient setting.
The ideal plan of action is always patient-centric and based on what our clinical team learns from the data. Sometimes all is takes is member education, often it is a much more difficult and multi-factorial problem. Outpatient primary and specialty care is a common theme. We also leverage payer medical directors and their network relationships to engage providers who may not have a clear line of sight into the extent of a member’s ER overuse. I agree with the idea of leaning “on providers to cut through complexity together,” as the Accenture report suggests. “The reality is that payers are typically challenged in impacting the parts of the healthcare journey that are ‘controlled’ by the provider. Therefore, it is key for payers to collaborate with provider networks to influence people’s decision making and lead them to appropriate sites for their care.” 1 This closely aligns with what I often recommend to self-funded employers as a part of the initial plan of action for an ER superuser.
Identifying members with frequent inappropriate emergency room visits and diverting to the right place of care can be a beneficial process for employers and employees. Plan sponsors can expect to see member cost decreases in both ER overutilization and total care rendered while increasing the quality of care.
- Stephan, Jean-Pierre; Feeley, Julian. “The rising cost of healthcare system complexity. How payers can humanize healthcare to cut complexity—and costs” Accenture, 2021. https://www.accenture.com/_acnmedia/PDF-161/Accenture-US-Health-Cost-PoV.pdf#zoom=40
- Hartnett, Kathleen P., PhD; Kite-Powell Aaron, MS; et.al. “Impact of the COVID-19 Pandemic on Emergency Department Visits,” CDC Morbidity and Mortality Weekly Report, June 12, 2020. https://www.cdc.gov/mmwr/volumes/69/wr/mm6923e1.htm
- “United States Trends in Emergency Department Visits,” CDC October 4, 2021 (updated daily by CDC) https://covid.cdc.gov/covid-data-tracker/#ed-visits
- “Labor shortage strains US hospitals’ profitability as Delta and burnout persist,” Moody’s Investor Service October 5, 2021. https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1297087&cid=CVW60Z52JZ14682