By Stephanie DeGraw | [email protected]

A recent health care summit hosted by the Sandy Chamber of Commerce explored ways employees and businesses can reduce health care costs. A variety of speakers shared their views.

The panel was organized by Suzanne Harrison, MD. She desired to bring awareness of the challenges consumers and businesses face with health care coverage. Newly elected to the Utah House of Representatives, Harrison represents Sandy, White City and Draper. She put together a panel of speakers for the event.

"The costs of health care for patients, families and businesses continue to increase. For many, it is at a crisis point,” Harrison said. "There is much that companies and patients can do to save money in a broken system. This health care summit delved into concrete actions that employees and businesses can take to reduce costs while maximizing health."

Harrison's role as a mother, practicing physician and policymaker gives her insight into solving problems. "I'm committed to finding solutions for the families and employers in my community. I'm working on legislation that will increase transparency and competition while driving down prices in health care so that businesses, families and taxpayers can spend less and stay healthy," she said.

Plan premiums and annual cost increases are often higher for small and mid-sized employers that lack the bargaining power of the big corporations. Small businesses, on average, pay about 8–18% more than large firms for the same health insurance plans, according to the National Conference of State Legislatures.

Another speaker on the panel pointed out that unnecessary care is a huge issue. "Expenses vary depending upon where one receives care," R. Chet Loftis, managing director of PEHP Health & Benefits, said. To save money, he recommends going to a doctor's office or freestanding facility versus a same-day service at a hospital. For example, a basic comprehensive health panel on average costs $50 at a freestanding lab or $60 in a doctor's office, compared to $332 at a hospital.

Patients can help cut costs for their employer and themselves by asking if the treatment is covered. And does the therapy require authorization, and are only in-network providers involved in my care? he said.

Other cost comparisons include simple surgeries like a colonoscopy, which can range from $632 to $3,828, with average of $1,052 and $2,703. Lab tests like a basic comprehensive health panel in a lab is $50, $60 in an office or anywhere from $332 to $572 in a hospital. Imaging such as an MRI ranges from $295 to $2,334, with an average of $333 to $1,834 at a hospital. Urgent care such as wound care is $130 in an office, $160 at an urgent clinic and $1,150 at the ER.

Loftis recommends visiting www.choosingwisely.org. The website helps patients choose care that is supported by evidence, not on other tests or procedures already received, and that is truly necessary. There are five critical questions recommended to ask your doctor before getting any test, treatment or procedure:

1. Do I need this test or procedure? Medical tests can help you and your health care provider decide how to treat a problem.

2. What are the risks? Will there be side effects? What are the chances of getting results that aren't accurate? Could that lead to more testing or another procedure?

3. Are there safer options? Sometimes all you need to do is make lifestyle changes, such as eating healthier foods or exercising more.

4. What happens if I don't do anything? Ask if your condition might get worse — or better — if you don't have the test or procedure right away.

5. How much does it cost? Ask if there are less-expensive tests, treatments or procedures. Ask what your insurance may cover.

Loftis said employers should be careful about paying a monthly fee when they introduce a new service to employees. It is best to pay as you go for the time employees use the service. Employers can cut costs by adopting HSA-eligible plans with generous employer contribution and first-dollar coverage of preventative drugs for diseases like diabetes.

Employers can minimize penalties for finding lower-cost care in your plan design. They can create an incentive for employees to get less expensive care, consider limiting the site of service or use reference pricing. Employers can learn about costs and educate employees. The employer can also ask doctors for a prescription for labs and imaging to support payment reform.

In 2020 costs will rise to $15,375 per employee, up from $14,642 per employee in 2019, according to the recent “Large Employers' Health Care Strategy and Plan Design” survey by the nonprofit National Business Group on Health (NBGH).

Another presenter at the health care summit, Joan Gallegos of Comagine Health, explained the “Choosing Wisely” national campaign. "The campaign is sponsored by the American Board of Internal Medicine Foundation, in partnership with Consumer Reports. The campaign promotes informed conversations between providers and patients," Gallegos said. The program recommendations include:

1. Avoid prescribing antibiotics for upper respiratory infections.

2. Avoid imaging for uncomplicated headaches.

3. Don't perform routine annual cervical cytology screening (pap smear) in women 30–65 years of age. 

4. Don't perform pap smears on women who had a hysterectomy for non-cancer disease.

5. Don't perform pap smears on women younger than 21.

6. Don't recommend follow-up imaging (CT, MRI) on positron emission tomography (PET) for clinically inconsequential ovarian cysts.

7. Don't do imaging for low-back pain unless red flags are present such as nerve damage, cancer or other underlying severe problems.

Another tip is to ask your doctor for a generic version of a prescription drug that is equally as effective. When a drug is advertised, it can be more expensive compared to potential alternatives. Some of the factors affecting drug prices include advertising and pharmaceutical sales. "Generic" doesn't always guarantee a low cost, and drug coupons circumvent co-payment tiers. Specialty and gene therapy drugs are also costly.

Patients need to ask questions ahead of time to avoid billing surprises, which include out-of-network emergency room visits and out-of-network "hidden provider." Patients should get prior authorization for treatment from their carrier and get a non-covered service.

Additionally, patients need to understand the role pharmacy benefit managers (PBM) play. A PBM is a company that negotiates with drug manufacturers for discounts on prescription drugs. The PBM contracts with retail pharmacies for in-network rates, processes pharmacy claims and manages the pharmacy benefit. 

PBMs and health plans have been separate entities. However, many of the largest PBMs and health plans have merged. Patients need to be aware that the health care world operates off of discounts. Discounts are transparent for medical services. 

Explanation of benefits for the patient discloses the provider's "billed amount" and the discounted in-network rate. Patients pay the in-network rate. Discounts are not transparent for prescription drugs. Patients pay the full retail price, and manufacturers pay "rebates" after the fact. Rebates flow first to the PBM, then to the plan, and then to the employer.

PBMs can be creative in the costs charged for their services. PBM contracts are divided into two categories: traditional and transparent. Transparent refers to a plan knowing how much the retail pharmacy was paid for a drug. It doesn't provide transparency for rebates.

Loftis encourages people to compare the value in their health care[AC1] . He advises reviewing your policy carefully since terms vary widely.