{"id":9431,"date":"2023-08-11T09:37:33","date_gmt":"2023-08-11T09:37:33","guid":{"rendered":"https:\/\/distilinfo.com\/healthplan\/?p=9431"},"modified":"2023-08-11T09:37:33","modified_gmt":"2023-08-11T09:37:33","slug":"strategies-for-lowering-emergency-department-admission-rates-and-costs-by-payers","status":"publish","type":"post","link":"https:\/\/distilinfo.com\/healthplan\/strategies-for-lowering-emergency-department-admission-rates-and-costs-by-payers\/","title":{"rendered":"Strategies for Lowering Emergency Department Admission Rates and Costs by Payers"},"content":{"rendered":"

Payers and members both prioritize reducing emergency department visits despite differing perspectives. High healthcare costs and growing trends underscore this shared objective. Strategies include virtual care adoption, leveraging value-based contracts, utilizing advanced analytics, addressing social determinants of health, and managing urgent care centers. While value-based care and virtual-first plans exhibit promise, strategies involving urgent care coverage have mixed results due to increased utilization costs. Overall, these efforts seek to enhance care quality and mitigate unnecessary emergency room usage.<\/p><\/blockquote>\n

Members and payers often hold differing perspectives, but there’s a notable point of convergence in their shared goal to minimize emergency department utilization.<\/p>\n

Frequenting the emergency department results in escalated healthcare expenses. The typical cost of a single trip to the emergency room within a sizeable employer-sponsored health plan stands at $2,453. The out-of-pocket expenses fluctuate between $128 and over $907.<\/p>\n

Regrettably, recent data trends indicate an upward trajectory in these costs. Emergency department services account for a fraction of overall healthcare system expenditures, constituting 3.2 cents out of each healthcare premium dollar. However, this statistic aligns with a prolonged increase in both emergency department spending and usage. Between 2012 and 2019, out-of-pocket and emergency room expenditures rose by 85 percent and 51 percent, respectively.<\/p>\n

Such visits strain both the healthcare system’s resources and the financial stability of members.<\/p>\n

Consequently, emergency department visits hold a pivotal position within payers’ initiatives to drive value-based care. Insurers are not only inclined to monitor this metric but also aspire to curtail needless emergency department utilization.<\/p>\n

To this end, payers leverage telehealth capabilities, employ advanced analytics tools driven by machine learning, and introduce value-based contracts to decrease both the utilization of and spending on emergency departments, among other strategic maneuvers.<\/p>\n

EMBRACING VIRTUAL CARE AND TELEHEALTH<\/em><\/p>\n

The proliferation of telehealth has propelled the rapid emergence of virtual care strategies. Many of these strategies aim to regulate avoidable emergency department visits while concurrently addressing other quality-related metrics.<\/p>\n

To accomplish this, these strategies offer round-the-clock support with a primary care focus. Some even waive copays for urgent care services. These approaches could potentially substitute after-hours consultations and less critical emergency room visits, according to projections in a McKinsey report. This virtual transition could divert as much as one-fifth of all emergency department visits.<\/p>\n

Initially, virtual-first health plans held the promise of diminishing the conventional expenses linked to emergency care. Anticipated benefits included enhanced patient outcomes and reduced costs. A separate analysis from McKinsey suggested that a virtual-first care model could reduce emergency care expenses to as low as $50.<\/p>\n

As virtual care plans gained momentum, payers sustained investments in telehealth solutions. For members advised to seek care within 24 hours, payers observed that tele-emergency care could lead to a reduction in emergency department visits.<\/p>\n

A study examining 7,845 Veterans Affairs member interactions with a tele-emergency care pilot demonstrated that this approach was connected with fewer emergency department visits compared to traditional nurse triage methods. Moreover, the pilot program resulted in decreased hospitalizations and reduced out-of-network spending.<\/p>\n

FOSTERING VALUE-BASED CONTRACTS<\/em><\/p>\n

The objective of value-based care is to curtail unnecessary expenditures and low-value medical interventions. One avenue that payers pursue to achieve this is by reducing the incidence of emergency department visits.<\/p>\n

Medicare Advantage beneficiaries have experienced significant benefits from the value-based care approach. Among adults aged 75 and older, emergency department admission rates are notably high, second only to infants under one year old. However, the value-based model adopted by Medicare Advantage has played a pivotal role in reducing these rates.<\/p>\n

A study encompassing nearly 489,800 Medicare Advantage beneficiaries indicated that value-based care outperformed the traditional fee-for-service Medicare system in terms of acute care usage. Beneficiaries covered under two-sided risk models exhibited 375.8 emergency department visits per 1,000 beneficiaries, compared to 434.1 visits for fee-for-service beneficiaries.<\/p>\n

Notably, avoidable emergency department visits were also fewer within the value-based care framework, with 21 visits per 1,000 beneficiaries in contrast to 26.8 in the fee-for-service model.<\/p>\n

These substantial variations were predominantly evident in two-sided risk models, in which providers embraced both upside and downside risks. Models solely embracing upside risk did not yield notable results.<\/p>\n

A prominent payer discovered that value-based contracts led to a 16 percent reduction in their members’ emergency department visits. Furthermore, hospital admissions decreased, while primary care visits and preventive screenings rose.<\/p>\n

HARNESSING MACHINE LEARNING AND ADVANCED ANALYTICS<\/em><\/p>\n

Machine learning and advanced analytics tools have the potential to streamline medical record data, pinpoint members with care gaps, and facilitate Medicare Advantage risk adjustment.<\/p>\n

In terms of emergency department utilization rates, these tools aid payers in identifying members at risk of emergency department visits or readmissions.<\/p>\n

Payers need not sift through extensive electronic health records to retrospectively determine the reasons for members’ emergency department visits. Instead, they can distill information to predict whether specific symptoms or ongoing conditions might lead a member to the emergency room. This predictive capability allows payers to be more proactive rather than merely reactive.<\/p>\n

However, these tools require cautious application. Algorithm-based methods aimed at identifying unnecessary care for reimbursement purposes have, in some instances, perpetuated biases against individuals of color.<\/p>\n

ENHANCING INITIATIVES RELATED TO SOCIAL DETERMINANTS OF HEALTH<\/em><\/p>\n

Social determinants of health (SDOH) encompass various facets of members’ lives that impact their capacity to maintain healthy lifestyles and manage chronic illnesses.<\/p>\n

Factors like loneliness, limited access to nutritious foods, and inadequate transportation options might contribute to emergency room visits, particularly among individuals with chronic conditions. An investigation involving over 21,500 Medicare Advantage members with type 2 diabetes unveiled that individuals grappling with loneliness or lacking transportation exhibited elevated rates of emergency department visits\u2014173.0 and 244.6 visits per 1,000 beneficiaries, respectively. Furthermore, food insecurity correlated with persistent acute care usage, including 84.9 emergency room visits per 1,000 beneficiaries.<\/p>\n

Separately, the US Census Bureau ascertained that individuals without transportation accessibility had a 2.5 times higher emergency department admission rate compared to those with transportation options.<\/p>\n

When payers identify and address SDOH elements, they can drive down rates of emergency department admissions and readmissions.<\/p>\n

For instance, one health plan collaborated with a meal delivery service to supply food to Medicaid beneficiaries managing chronic illnesses requiring specific diets. Beneficiaries received these deliveries for a span of 13 weeks.<\/p>\n

This endeavor led to a 31 percent reduction in emergency department visits. However, due to the pandemic, a control group experienced a 17 percent decline in emergency department utilization.<\/p>\n

A CMS program catering to fee-for-service Medicare beneficiaries similarly discovered that addressing social determinants of health resulted in fewer emergency room trips.<\/p>\n

The program employed a survey to identify beneficiaries with SDOH needs such as housing, food, and transportation insecurity. The payer subsequently provided assistance in navigating community services. These navigational services led to a 9 percent decrease in emergency department visits.<\/p>\n

LIMITATIONS OF DIVERTING CARE TO URGENT CARE CENTERS<\/em><\/p>\n

One strategy attempted by certain significant payers has yielded mixed outcomes: constraining emergency department coverage to encourage patients to seek care at lower-cost urgent care centers.<\/p>\n

On average, an urgent care visit incurs expenses about $1,475 lower than an emergency room visit\u2014$171 compared to $1,646, respectively, as per a nationwide study spanning a decade. Furthermore, the establishment of new urgent care centers correlated with a decline in emergency department visits within the respective areas.<\/p>\n

Nevertheless, the same study revealed that the savings from individual urgent care visits were offset by the increased costs linked to a surge in urgent care visits. Due to heightened utilization, urgent care expenses increased by $6,327.<\/p>\n

This approach has, in some cases, backfired against major payers. When one prominent payer altered its standards for emergency department coverage and advocated for members to<\/p>\n","protected":false},"excerpt":{"rendered":"

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