Lifesaving medical care is anything but affordable. In the U.S., the average cost of an ambulance ride is $1,300. Suffer a heart attack? This major medical event could cost you $100,000 or more if surgery is involved.
Protecting employees from exorbitant healthcare costs requires employers to proactively address rising health costs and mitigate the expense of lifesaving medical care. Through employee benefits consulting, you can enhance your health benefits strategy.
The Hidden Costs of Emergency Medical Care
When ill or injured, a trip to the emergency room doesn’t typically conjure images of surprise bills. However, when these outrageous medical bills arrive later on, they can create extreme stress and anxiety. Emergency medical care often includes various unknown costs, especially for patients without insurance.
Patients may encounter facility fees simply for entering the ER, inflated costs for administered medications, fees for specialist consultations, billing for “observation time,” and charges for seemingly minor supplies such as bandages. Even if your stay is short, these costs can quickly add up.
A Case Study: The $297,461 Rattlesnake Bite
Just how much emergency medical care can cost is evident in a case involving a 2-year-old from San Diego recently bitten by a rattlesnake in his backyard. The cost of two ambulance rides, an emergency room visit, antivenom, and a couple of days’ stay in the pediatric intensive care unit? $297,461, with the antivenom accounting for $213,278 of the total bill.
Some professionals speculate that the high price is due to hospital markups designed to generate revenue and balance overhead costs.
Why Medical Costs Vary So Drastically
Medical costs can vary drastically due to hospital pricing strategies and a lack of competition. Hospitals often use a chargemaster that lists inflated medical service prices, which can vary between facilities. As these prices are not standardized or transparent, patients are left unaware of costs until after the service has been rendered.
Additionally, hospitals can set higher prices in areas with limited healthcare providers due to low competition. Large health systems may also negotiate higher costs with insurers, raising costs further. When emergencies occur, patients are often unable to choose their own care providers or whether they will be transported via ambulance, which can lead to balance billing.
How Employers Can Help Mitigate Outrageous Medical Costs for Workers
While today’s employers strive to offer competitive and exhaustive benefits, a careful approach must be taken to prevent going over budget. Here are some ways that employers can help mitigate outrageous medical costs for their growing workforce:
The Importance of Strong Health Plans and Network Optimization
Employers can provide employees access to high-quality care while minimizing out-of-network exposure by negotiating strong network agreements with insurance carriers prioritizing a broad range of top-tier healthcare providers.
Working with insurers to secure competitive rates with reputable hospitals, primary care networks, and specialists can help your employees maintain access to quality, affordable care.
Education and Transparency Tools for Employees
Employers can help their workers manage medical costs by providing access to valuable resources such as cost estimators, similar to Healthcare Bluebook, which allows employees to compare the costs of standard procedures and services at different in-network providers. Additionally, educating employees on navigating emergencies can play an essential role in minimizing unexpected out-of-pocket expenses.
Proactive Measures to Address Rising Healthcare Costs
As healthcare costs continue to rise, employers face increasing pressure to provide affordable, high-quality care for their employees while managing their bottom line. Consider the following proactive measures to address rising healthcare costs effectively:
Role of Pharmacy Benefit Management in Specialty Drug Costs
Employers can address soaring expenses for high-cost treatments such as antivenom by reforming their pharmacy benefit management (PBM) strategies to help keep necessary medications accessible.
One approach involves negotiating with PBMs to secure better pricing for specialty drugs through formulary management, which includes placing preferred medications on a list of covered treatments with lower copays or higher reimbursement rates.
Advocacy for Ground Ambulance Coverage Regulations
Despite recent advancements such as the No Surprises Act, which aims to protect consumers from unexpected out-of-network bills in emergency situations, there are still notable gaps in coverage.
Employers can advocate for policy changes by supporting efforts to close these gaps, such as pushing for expanded protections for ambulance services or a broader application of the No Surprises Act to include more scenarios.
In the meantime, employers can incorporate supplementary benefits, such as supplemental insurance plans or health savings accounts (HSAs), to help cover out-of-pocket costs not addressed by primary insurance.
Let Employee Benefits Consulting from New City Help Enhance Your Health Benefit Strategy
Addressing rising healthcare costs and the extravagant cost of emergency medical services requires a multifaceted approach that involves strategic planning, policy advocacy, and working with a reputable benefits consultant to restructure employee benefits effectively.
The professionals at New City Insurance can help your business implement proven strategies for long-term cost savings and better benefits through employee benefits consulting. Contact New City today to get started.