Amy Villalobos of nib began the discussion by talking about cost avoidance and hospital substitution. Access to medical care is expensive and healthcare systems are complex, with the average cost of treatment increasing year-on-year, she stated. Trying to navigate a hospital system can be extremely complicated, which means costs are hard to avoid.
Addressing the room by relating the experience of being in an unfamiliar location, Amy conveyed how travellers and foreign nationals can inadvertently end up seeking high-cost, inappropriate treatment by presenting their case to emergency rooms (ER); having no known alternative, this is often their first port of call. Amy referenced that between 40-60 per cent of ER visits are avoidable, and although many companies have partnerships set up with these institutions that give them discounted rates for these services, a discounted rate is still a steep price to pay for unnecessary treatment.
Insurers exist to pay claims, Amy asserted, and although they must do their best to achieve efficient levels of cost containment, they also need to remain focused on the fact that there is a person seeking treatment.
Detailing various cases in which nib had practised successful cost containment techniques, Amy explained that case management concerns three components: enhanced clinical outcomes, reduced benefit outlay and outstanding member experience. It’s all about the right service at the right price at the right time, she said.
Looking at dynamic medical case management, Dr Eugene Delaune of GMMI referenced the problems of costly medical care (particularly in the US), the high cost of medical transport and an insurer’s need to impose more effective cost containment solutions. Right from the get-go, he asserted that it was not possible to meet all of the needs of all parties involved.
Dr Delaune noted that when managing the costs of medical cases, it is important to set realistic expectations early on. Specifically, he explained that informing the patient straight away that that they would be transferred home, but that that they wouldn’t necessarily immediately recover, was essential in this process. Doing so would prevent any disappointment on the patient’s side.
Dr Delaune also examined the other factors that need to be considered when a case is first opened. Identifying the payer (both the individual and the insurance company), the costs that are covered (i.e. emergent care, transport, long-term care and medical costs after repatriation) and the anticipated duration of treatment was extremely helpful in ensuring that costs could be managed throughout the lifetime of the case. In the end, Dr Delaune reasoned, dynamic medical case management must always consider the ethical component – doing what is right for the patient and getting the patient home will always remain major decisive factors in the medical transport cost containment process.
Gregory Marsella of New Frontier Group kicked off his presentation by hopping off the stage and taking to the floor to discuss the risks and benefits of using tender payments as a negotiation tool. He offered up a real-life example of a tender payment, analysing the claim observations, the details known about the claim and the legal principles that could be applied to the claim.
A key finding from Gregory’s research revealed that when it comes to tender payments, often insurers aggregate multiple claims into one lawsuit and, that generally, cases move quickly to resolution, with the average case lasting 12 months. However, Gregory’s overall message was that tender payments are best avoided. He surmised that the process of tender payments is an extremely risky strategy for insurers, as, once in court, sympathy tends to be directed towards the provider; hospitals are often very well acquainted with the legal system; and some states even have laws that favour providers. What’s more, once in court, claims costs could increase substantially due to attorney fees and interest.
For a better outcome, Gregory advised, a less dramatic approach can be employed to achieve a more favourable result. He conveyed this sentiment via the analogy of using a chainsaw for a haircut: “It may cut hair, but it’s likely to cause severe collateral damage.”
AP Companies Global Solution’s Natalya Butakova detailed the key components and benefits of AP Companies’ automated cost containment tool, remarking upon the tool’s use of technical checking points, which check for duplicate invoices and services, price match claims with medical providers and apply the relevant discount for the provider. She noted that the cost containment tool also uses medical checking points.
In her presentation, Natalya touched upon the adoption of AI in the cost containment sphere, with particular reference to ‘big data’ and where this information was obtained from.
Conveying the results seen after two years of implementing the automated cost containment tool, Natalya noted that it simplified the process of analysing claims; the tool required minimal integration with maximum adaption, it had a customisable and ergonomic web interface, encouraged optimum engagement through its flexibility and pay-per-claim fee structure, and that the maintenance ran like a dream by providing continuous improvement via a dedicated team. All in all, the return on experience was worth it, she stated.