Physician-Owned Hospitals Save Big, Average Employee Healthcare Costs Grow

October 25, 2023 - Physician-owned hospitals are seeing savings, leading researchers to call for congressional support for physician-owned sites of care.

However, employee costs are growing in America. Premiums for family coverage have grown 22 percent in the last five years, with small business employees experiencing particularly high increases. Meanwhile, some providers are using eLearning to improve their EHR training with more flexibility. The practice may result in lower burnout rates. And finally, one hospital is prescribing renewable energy to low-income patients and providing it for them.

Kyle Murphy:

Hello and welcome to Healthcare Strategies, Headlines edition.

Kelsey Waddill:

Woo.

Kyle Murphy:

In today's episode, we have

• The Doctor's Impact on Healthcare Costs
• Employee Healthcare Costs Soar
• A Partial Solution to Clinical Satisfaction
• Health System Prescribes Renewable Energy

Hello, audience listeners. This is Kyle Murphy, vice president of editorial Xtelligent Healthcare Media, and I am joined by Kelsey Waddill, senior editor, multimedia manager--

Kelsey Waddill:

Mm-hmm.

Kyle Murphy:

--all things Payer. How are you, Kelsey?

Kelsey Waddill:

Doing good. Doing good. It's almost Halloween. So...

Kyle Murphy:

Almost Halloween. And on that subject, well, by the time we record next week, it will be Halloween proper. So-

Kelsey Waddill:

Yeah. Mm-hmm.

Kyle Murphy:

... in anticipation, favorite Halloween candy?

Kelsey Waddill:

It's always Reese's. It's never going to be anything else. I-

Kyle Murphy:

The older I get, the more I realize that chocolate and peanut butter were meant for each other.

Kelsey Waddill:

It's the classic and for a reason.

Kyle Murphy:

I take it a step further, and I go Snickers, but I think that's the obvious choice for many reasons.

Kelsey Waddill:

But that's caramel and chocolate.

Kyle Murphy:

Well...

Kelsey Waddill:

You're branching out a little too far there.

Kyle Murphy:

Peanut butter and caramel. Never a Milky Way, but definitely a Snickers. Least favorite candy?

Kelsey Waddill:

Least favorite candy...Laffy Taffy. Does that even count?

Kyle Murphy:

It can count. Whatever those doorstop marshmallow things were.

Kelsey Waddill:

Oh, gosh.

Kyle Murphy:

I think they've already discontinued those because I'm a child of the '80s.

Kelsey Waddill:

I think I know what you're talking about.

Kyle Murphy:

But that was just, yeah, that was just like, here, throw this in the trash.

Kelsey Waddill:

Yeah.

Kyle Murphy:

It's like when someone gives you a flyer on the street.

Kelsey Waddill:

I don't know if I've had one of those, but I imagine that they would get very, very stale and hard, very fast.

Kyle Murphy:

Yeah, yeah, yeah. Not good. Not to mention that they weren't wrapped and usually just somebody giving you this like a plastic bag, which-

Kelsey Waddill:

Yeah, oh. That seems like a public health problem.

Kyle Murphy:

Oh, it is. Halloween can be dangerous, although fortunately things are pretty safe nowadays.

Kelsey Waddill:

Yeah.

Kyle Murphy:

So I'm looking forward to trick or treating. So be good to all your trick or treaters in your neighborhood, if you see any.

Kelsey Waddill:

Yeah, give them Reese's.

Kyle Murphy:

Give them Reese's if you love them. Give them the other things if you don't.

Kelsey Waddill:

Yeah.

Kyle Murphy:

All right, let's get into today's headlines. You ready?

Kelsey Waddill:

Yes, let's go.

Kyle Murphy:

Alright. The Doctor's Impact on Healthcare Costs. Per RevCycleIntelligence, a recent study indicates that physician-owned hospitals could save Medicare over $1.1 billion.

Kelsey Waddill:

Wow.

Kyle Murphy:

Conducted by professors from UConn Health and Loyola University of Chicago, the study found that total payments were significantly lower at physician-owned hospitals, compared to traditional hospitals, for treating Medicare patients with the 20 most expensive conditions. The patient populations in both physician-owned and traditional hospitals were statistically similar, making the payment differences unrelated to demographic or comorbidity profiles. Physician-owned hospitals treated Medicare beneficiaries with the most expensive conditions at 8 to 15 percent lower cost compared to traditional hospitals. The research supports current congressional debates on amending laws to allow the expansion of physician-owned hospitals. Who would've thunk it?

Kelsey Waddill:

Yeah.

Kyle Murphy:

Physicians owning the hospitals.

However, the American Hospital Association opposes such legislation--I couldn't see why--arguing that these hospitals select patients who maximize profits, thereby undermining full-service hospital care.

I would never have expected them to take that position.

Kelsey, around 250 hospitals are physician-owned, out of more than 6,000 hospitals in the US. Yes, I can see your eyebrows raising.

Kelsey Waddill:

Yes.

Kyle Murphy:

Site of care determines cost, but did you ever think that the hospital ownership has such an impact on cost?

Kelsey Waddill:

I'm kind of shocked that physician ownership is a novel idea or seems to be a novel idea. Seems like the people who run the place should own the place, but...

Kyle Murphy:

I'm flabbergasted.

Kelsey Waddill:

I know.

Kyle Murphy:

Do you not know how capitalism works?

Kelsey Waddill:

Oh, man.

Kyle Murphy:

All right, what's next?

Kelsey Waddill:

Let's see. So while physician-owned hospitals are saving dollars, employees are watching their wallets get thinner and thinner due to healthcare costs.

The KFF Employer Health Benefits Survey 2023 came out last week and the results were not great for workers.

Kyle Murphy:

Boo.

Kelsey Waddill:

So here are a few of the top stats. There was a 7 percent increase in annual family premiums. In dollars, that's on average about $23,968 in premiums this year.

Kyle Murphy:

Yikes.

Kelsey Waddill:

Yeah. The amount that workers contribute to family premiums increased $500, to hit $6,575 annually.

Kyle Murphy:

Ouch.

Kelsey Waddill:

And the results show also that where you work does make a difference. Small business employees got the short end of the stick, had larger deductibles with an average of $2,434, versus at larger firms, they had $1,478 deductibles. And then around one in four small business workers paid at least $12,000 annually in premiums for family coverage.

To put this in a sort of larger context, last year we saw some pretty steady numbers for premium growth; however, over the last five years, we've seen premiums jump 22 percent, which is crazy. At the same time, wages have gone up 27 percent and inflation grew 21 percent. So-

Kyle Murphy:

Not good numbers.

Kelsey Waddill:

Yeah. Yeah, not great.

Sadly, it's not expected to get better from here. Nearly a quarter (23 percent) of employers plan to increase workers' contributions in the next two years, even though about six out of ten employers also said that their employees were concerned about cost-sharing affordability. So they're like, "We see that, but we're going to raise it anyway."

So Kyle, that's a lot of numbers, but I think it's safe to say that affordability in healthcare is not looking good for most people in employer-sponsored health plans, and it's clear that employers know this. So what do you think will be the implications of these stats for workers and for their companies?

Kyle Murphy:

It's tough, right? The way the American healthcare system is set up, your employment dictates your healthcare coverage, by and large. We are seeing the trends, in terms of high deductible plans. So I have to think that the impact is negative, in terms of how they'll be using their care. If you know that you're going to be paying more, I think you're going to be a lot more selective.

I think the things that folks need to think about, as they use their coverage, is focusing on those services where cost-sharing is not a huge factor.

Kelsey Waddill:

Mm-hmm.

Kyle Murphy:

Preventive care. So get your shots, get your immunizations, get all that work done that is part of your regular maintenance, and then when you're sick, you're probably going to avoid your PCP when you're sick, you're going to go to urgent care or a walk-in where the cost is much more affordable and sadly, that creates a more fragmented experience.

Kelsey Waddill:

Mm-hmm.

Kyle Murphy:

But in terms of being a savvy shopper these days, that's what you have to do.

From an employer standpoint, I think it just stinks because you have inflation, you have employees, rightfully, demanding higher wages, but higher wages then comes at a higher total cost because your benefits go on top of that. I think if you... One of the tidbits you shared was the variation between small businesses and larger firms--there has to be some kind of collective sharing or collective bargaining that goes on to drive the premiums down or to increase the breadth of benefits. But as you can see, and as we know, there's not as much transparency-

Kelsey Waddill:

Right.

Kyle Murphy:

... in healthcare coverage and health plan design-

Kelsey Waddill:

Yeah.

Kyle Murphy:

... as one would think in this day and age.

Kelsey Waddill:

Yeah, it's in a lot of the other industries. Where's our transparency?

Kyle Murphy:

Yeah. You don't need it. Doesn't work.

Here's some positive news.

Kelsey Waddill:

Good.

Kyle Murphy:

A Partial Solution to Clinical Satisfaction, because you want your doctor to be happy.

Kelsey Waddill:

Yes.

Kyle Murphy:

Because they might actually be able to take care of you-

Kelsey Waddill:

Yeah.

Kyle Murphy:

... in a more meaningful way.

Per EHRIntelligence, healthcare organizations are increasingly turning to self-directed e-learning as a cost-effective EHR training method to complement--with an "E"--traditional instructor-led training, according to a KLAS report. Clinician endorsement of e-learning for EHR training increased from 67 percent in 2021 to 83 percent-

Kelsey Waddill:

Wow.

Kyle Murphy:

... in 2023. That's pretty good.

Kelsey Waddill:

That's a big jump.

Kyle Murphy:

Positive trend.

Kelsey Waddill:

Yeah.

Kyle Murphy:

The gap in satisfaction between in-person and e-learning has narrowed, indicating that well-executed e-learning can be almost as effective as in-person training. Quality virtual training is associated with better clinician experiences and decreased reports of burnout.

Kelsey Waddill:

That's good. We need that.

Kyle Murphy:

No one likes to burn out.

Kelsey Waddill:

Yeah.

Kyle Murphy:

You just better slowly fade away. God bless you, Neil Young.

Clinicians satisfied with e-learning was 73 times more likely to report satisfaction with IT leadership related to EHRs. Newer clinicians are more likely to engage with e-learning due to their prior exposure to similar platforms during education. This is the virtual remote learning demographic-

Kelsey Waddill:

Yeah.

Kyle Murphy:

... finally coming to bear on the workforce. Overall, the shift towards e-learning reflects improvements in program quality and a greater willingness among clinicians to engage with digital education formats.

Kelsey, you and I do remote work, an awful lot.

Kelsey Waddill:

Yep.

Kyle Murphy:

Remote work has become part of the new normal.

Kelsey Waddill:

Yeah.

Kyle Murphy:

It's about time education and training kind of followed suit, wouldn't you think?

Kelsey Waddill:

Yeah, I think so. It also expands access to these topics, and clearly clinicians who are pretty short on time, it might help them get to catch up in other settings as well. So yeah, it seems like it's about time.

Kyle Murphy:

It would seem to be a lot better to do this at your own time, learn at your own pace.

Kelsey Waddill:

Right.

Kyle Murphy:

Because we know that not everyone learns the exact same way.

Kelsey Waddill:

Yeah.

Kyle Murphy:

And sometimes, people benefit from being in different environments. I can't imagine trying to be in a clinical environment doing your training.

Kelsey Waddill:

Yeah.

Kyle Murphy:

Feels natural. Maybe we should treat these people like humans.

Kelsey Waddill:

I think that that's the moral of this whole podcast, really.

Kyle Murphy:

People would say I'm rather progressive.

Kelsey Waddill:

So-

Kyle Murphy:

Speaking of advancements.

Kelsey Waddill:

So one health system is prescribing renewable energy to its patients. Boston Medical Center Health System (BMCHS) is going where no health system has gone before, at least according to their press release. And they've developed a pilot program in which providers can write a prescription for a lower utility bill.

So in this pilot, 80 lower-income households with eligible patients will get a discount on their utility bill to the amount of around $50 per month, which will cut down household costs, on average, by around $600 per year. And given the need for solid AC and heating in Boston, as we both know, Kyle, being residents of the Commonwealth of Massachusetts-

Kyle Murphy:

Woo.

Kelsey Waddill:

... this represents about a 30 percent discount on the average Bostonian's electrical bill, which is nothing to sniff at.

BMCHS is providing the energy itself by installing solar panels on an administrative building and conducting that renewable energy to its pilot participants through virtual net metering, which will be facilitated by Eversource, the SMART program from the Massachusetts Department of Energy Resources. And the hospital system is leveraging the 2022 Inflation Reduction Act's "Low Income Communities Bonus Credit" in order to do so.

So the goal here is, obviously, to improve social determinants of health for nearby communities and for their patients, not just by lowering costs that might prevent them, as we were talking about earlier, from being able to cover healthcare needs, but also by hopefully endorsing a cleaner environment in Boston overall.

So Kyle, it seems like providers are coming up with some increasingly creative and exciting ways to address social determinants of health. It's always hard to measure the impacts, but there's a lot of excitement in this space. And, having been in this field for a while now, what do you think about the progress that we've made so far?

Kyle Murphy:

I think that there's, now that we get to something tangible, to me this is real. When you talk about access to food, we talk about access to energy for folks who are lower on the economic scale, you're choosing, sometimes, between energy and food.

Kelsey Waddill:

Yeah.

Kyle Murphy:

And we know that living in a difficult environment or being malnourished is not exactly good for your health. So it makes a lot of sense. Hospitals and health systems have stood up a lot of infrastructure over the years. It's probably about time some of that leaks back out into the community. And I think really at this point, any step towards helping folks out, helping communities out, is a step in the right direction. Hopefully, this serves as a model for future advancement, but I think if you're in the business of healthcare for the right reasons, the ethical, moral reasons, you're trying to improve the health and wellbeing of individuals. And that is something that occurs by and large outside of a medical setting in someone's day-to-day life. So it only stands to reason that if you care that much, you'd care more of the time rather than less of the time.

Kelsey Waddill:

Yeah, and not just for individual patients, but for communities. This is affecting households, not just an individual patient.

Kyle Murphy:

We know for a fact that in healthier communities, quality of life improves, people are more productive, people are happier.

Kelsey Waddill:

Mm-hmm.

Kyle Murphy:

When people are happy, they tend to do a lot more. They tend to have a lot more satisfaction, and the knock-on effects of those are, by and large, positive. So I think we should be doing a whole lot more to improve community health by addressing these individual health and socioeconomic factors.

Kelsey Waddill:

Yes.

Kyle Murphy:

And with that, that's a good way to end the podcast, don't you think?

Kelsey Waddill:

I think so.

Kyle Murphy:

All right, everybody that wraps up today's episode, make sure to follow us on Apple, Spotify, or any place where you digest your podcasts.

Kelsey Waddill:

Have a great week.

Kyle Murphy:

Bye-bye.