Whether you are a bootstrapping HR Manager at a company with 200-300 employees or a Director of Benefits managing 10,000+ eligible dependents, chances are that the details of managing Self-Insured Medical plans are important to you. With that in mind, here are a couple of long-standing commandments of cost control within Medical plans:
1. Always push covered individuals away from use of the emergency room and to the "emergi-care" or doctor's office... Anytime I think of the ER, I always think of one of my favorite shows - Scrubs!! (cast pictured at right)
2. Always push Generic Rx!
Based on my analysis in the last week, add this one to the list:
3. All Outpatient Surgery is not created equal from a cost perspective - encourage employees to use an Ambulatory Surgery Center (ASC) whenever possible, as the cost for the same procedure may be dramatically lower versus the same procedure performed within the outpatient clinic of a hospital...
Why's this on my radar screen today? I was reviewing our medical run rate for the last couple of months and noticed a situation I was familiar with from an employee perspective - a covered individual with a vascular issue who needed medically necessary laser surgery performed 2x. The individual had the surgery performed twice based on the condition - and based on Dr. availability, did the procedure once at a outpatient clinic located within a local hospital, then followed up with the same procedure being done at an ASC of the same hospital chain. The cost results were as follows:
-Total Cost of Procedure at Outpatient Clinic located within Local Hospital - $5,000. Patient Co-Pay for Outpatient procedure - $150. Total $$ remitted by insurance network to Outpatient Clinic located within hospital (cost to company)- $3,200.
-Total Cost of Procedure at ASC- $4,600. Patient Co-Pay for Outpatient procedure - $150. Total $$ remitted by insurance network to Outpatient Clinic located within hospital (cost to company) - $500.
Additionally cost incurred by plan by using outpatient clinic within hospital instead of ASC - $2,700
Value of this knowledge moving forward - Priceless....
As you might expect, I've got a call into my provider to figure out what the exact difference is, but I have already been prepped that the difference is the overhead that is a part of the "big" hospital, as well as the fine print of the network agreement between my insurance provider and the hospital.
Note to Self - explore changing specs of plan to reduce facility co-pay for employees who use pure ASC's for outpatient surgery as opposed to the outpatient clinics located in hospitals. Additional note to self - watch the last three episodes of Scrubs I have on my DVR over the weekend....