A Healthy Employee is Not an Absentee
Keeping employees healthy is one way of keeping them on the job; this in itself is insurance against absenteeism. Absenteeism is not the only cost a company has to deal with, however, there is also the cost of the treatment, negligence on the part of doctors, irresponsibility on the part of pharmacists and extravagance on the part of certain employees.
This article deals with ways to reduce medical costs; it exposes medical rip-offs and billing mistakes that cost a fortune and offers cost saving ideas for slashing medical bills.
Keeping employees healthy is one way of keeping them on the job; this in itself is insurance against absenteeism. Absenteeism is not the only cost a company has to deal with, however, there is also the cost of the treatment, negligence on the part of doctors, irresponsibility on the part of pharmacists and extravagance on the part of certain employees.
This article deals with ways to reduce medical costs; it exposes medical rip-offs and billing mistakes that cost a fortune and offers cost saving ideas for slashing medical bills.
Reducing Medical Costs
U.S. Companies’ health-care expenditures averaged more than $2,300 per person in 1988, up more than 19% over expenditures in 1987, according to a survey conducted by Weber Lipshie & Co., certified public accountants, New York.
General Motors, for instance, covers more than 1.1 million employees and former employees, and the company says it spent roughly $5.6 billion on healthcare expenses in 2006. GM says healthcare costs add between $1,500 and $2,000 to the sticker price of every automobile it makes. Expenditures of this nature are enormous only because it is not the sick person who is paying the bills so why should he or she care. If the sick person was given a budget for medical expenses and required to buy health insurance for anything in excess the results would be different.
Medical Rip-Offs
To hold down medical bills, doctors must be asked about the pertinence of each test they conduct, and whether it is needed.
According to a study at the University of California, reported in the Journal of the American Medical Association, six out of 10 medical tests are unnecessary. Doctors order them because of insecurity, pressure, hospital profit, curiosity, or habit.
Other studies have shown that fully a quarter of the surgical procedures performed in the United States each year are entirely useless. Part of the problem there is that in the past 10 years, the number of surgeons has increased, while the demand for operations has remained constant. As the opportunities per surgeon dwindle, the pressure mounts to perform surgery that is only “marginally” indicated, according to the publishers of The Complete Book of Money Secrets, by Boardroom Classics in New York.
To protect against unnecessary surgery, ask the physician hard questions beforehand:
- What are the risks?
- How many people have you seen with similar symptoms who have chosen not to have surgery?
- How long will it take to recover?
- What is the likelihood of complications? What sort?
- Are there alternative ways to treat this condition?
- How many of these operations have you done in the past year?
Cheaper Surgery
If a major operation is absolutely necessary, negotiating fees with doctors can result in a 25 to 30 per cent price reduction. Doctors frequently agree to lower their prices after patients insist on getting a second opinion and state that they will use the doctor whose price is more reasonable.
The U.S. government has compiled a list of potential second-opinion physicians. The list can be obtained by phoning 1-800-638-6833.
Free Drugs
Doctors are constantly visited by salespeople from drug companies who leave samples. The samples usually sit forgotten in a desk or filing cabinet, and thrown away once the expiry date is passed.
You could ask your doctor for these drugs, and save on your medical costs.
Low-Cost Emergency Centers
There are now more than 2,000 freestanding emergency centers nationwide. They deal with a wide range of health crises: respiratory illnesses, gastrointestinal problems, fractures, sprains and lacerations. Although these clinics lack the blood banks or equipment to handle major emergencies (such as stroke and cardiac arrest), they can stabilize such patients for short periods.
In addition, there are upward of 200 surgical centers for minor elective operations. As surgery becomes more sophisticated and less invasive, many procedures that once required a hospital stay can now be done on an ambulatory basis, with local anesthesia.
The most obvious advantage of the free-standing clinic (particularly to employers, who wind up paying most of the bills) lies in its economy. Comparable care typically runs at least one-third less than it would in a hospital. Examples: treatment of a fractured arm costs on average $157 in a hospital emergency room, but only $71 at a freestanding clinic; influenza with fever costs $159 at a hospital, but only $30 at a clinic; arm laceration and suturing costs $133 at a hospital, but only $75 in a clinic.
The clinics charge less because of lower overhead. They aren’t supporting expensive labs, high-tech machinery or large numbers of peripheral staff. They are usually very efficient.
For information on freestanding clinics and surgery centers, contact the Freestanding Ambulatory Surgical Association, 1040 McDowell Rd., Phoenix, AZ 85006. Also, the National Association of Freestanding Emergency Centers, 5151 Beltline Rd., Dallas, TX 75240.
Billing Mistakes
Ninety-seven percent of hospital bills are wrong, and less than 2 per cent of those errors are in the patient’s favor, according to Harvey Rosenfield, head of watchdog group Bills Project.
The average error in 1989 was estimated to be $600, according to the New York Life Insurance Company’s auditing department. Frequent mistakes include billing for items or services never delivered, lab work, medication, respiratory equipment, etc.
The best way to catch billing errors is to insist on an itemized bill, and reviewing it carefully before paying. You could even insist on reviewing the charges with the practitioners. But that is not always enough. A typical mistake could be a $500 charge instead of $50 for an electrocardiogram. Since you may not know the typical cost of an EKG, the error goes undetected. Another example: The doctor might order 10 days of penicillin and then switch to tetracylcine after four days. If the unused six days’ worth of penicillin is not returned, the patient is billed for it.
Unfortunately, there is no “official” list of acceptable charges for doctors and dentists. Most professional societies no longer conduct peer reviews of doctors’ fees. Furthermore, government agencies have no blanket supervisory authority over what medical practitioners charge. Unless the charges are so excessive that they are criminal, or in cases where Medicaid or Medicare is involved, there is no sense in contacting a government agency.
The only alternative is to be stern with your doctor, and to remember your strongest card is that you always retain the right to seeking a second opinion.
Economical Health Insurer
Because smaller employers don’t have the clout that big companies do to demand lower rates, they’ve been hit with much higher health-insurance costs in recent years. That need not be the case.
Employee Benefit Plans Inc. provides small and medium-sized employers with the capability to create their own health-insurance plans rather than buying a plan from a big insurance company. This can cut a company’s health-insurance bill by up to 30 per cent. (Self-insuring eliminates markups, and state laws are more lenient for self-insurers, which further cuts costs.)
The plan operates in more than half the U.S. states, and is expanding quickly as the demand for low-cost insurance grows. See the Yellow Pages for the office closest to you.
Bonus for Cutting Health Claims
Some employees at Berol Corp., a Connecticut manufacturer of writing utensils, receive up to $500 annually for limiting their medical expenses.
Under the Berol plan, employees receive $500 a year, less the amount of claims paid by their insurer, Connecticut General Life Insurance Co. The plan calls for a $150 deductible. Connecticut General picks up 80 per cent of the next $2,000 in claims and pays 100 per cent thereafter, up to $1 million.
Under the new incentive plan, for example, if an employee runs up a $200 medical bill, he must pay the first $150. The insurer pays 80 per cent of the remainder, or $40. At the end of the year, the $40 paid by the insurer is subtracted from the $500. Thus the employee receives $460.
Since employees have an investment in the program itself, they are not just going to run into the emergency room of the hospital if they can see a doctor instead and face a lesser charge.
Clean Those Filters
Before concluding that absenteeism from illness is always misdiagnosed as an attitudinal or behavioral problem, look around for other possible sources. Humidifiers or air conditioners, for instance, may be the cause of ill health in your company. Recent evidence shows that the use of humidifiers may not be the best and safest way to add moisture to our living environment. Experts say that water left sitting in most types of humidifiers becomes stagnant and acts as a breeding ground for bacteria and fungi, which are then blown into the air and trigger health problems.
Bacteria and mold growth within humidifiers has long been a concern due to the ability of the humidifier to emit this bacteria into the surrounding room where employees are at risk of serious illness from inhalation of these microorganisms. Studies have shown that regular cleaning of the humidifier as well as the use of treatment products that control bacteria and scale are important for good humidifier health.
The sources of illness are usually more obvious, however. Doors or windows may be left open causing a draft, air conditioning may be set too high thus overcooling offices, bad lighting can lead to depression and workers may be outside on the job in winter without jackets. They should know better but sometimes it takes a stern reminder of the consequences before it sinks in.
Never Accept the Complete Prescription
Under Medicare a cancer patient was given radiation treatment for the throat.
The pain was intense so the doctor prescribed a certain painkiller. There were 100 pills in the prescription but they didn’t ease the pain one bit. A call to the doctor resulted in a different prescription which didn’t help either and a third and a fourth was no better until a fifth prescription finally offered some element of relief. Four government paid prescriptions ended up in the garbage. In this case the doctor was negligent for not suggesting trial sizes to ascertain the right combination. The pharmacist was also irresponsible for not suggesting trial sizes; the government is the real culprit for not passing a law to eliminate this extravagant waste.
A law should be instituted whereby no prescription should be filled completely until it is proven to be effective for the patient. If all new medications prescribed were trial sizes and doctors and pharmacists made more responsible it is quite possible that billions of dollars in medical costs could be saved annually. Company health care managers in the meantime should develop a clause whereby trial sizes of new and untried prescriptions become mandatory.
