Healthcare in a Minute – October 2017

By George W. Chapman

Hospitals Fail to Meet Expectations

A report published by Kaufman, Hall and Associates revealed only 8 percent of 125 healthcare organizations surveyed met consumer expectations. The report found that while almost all organizations say improving the patient experience is a high priority, just 30 percent have the capability to do so. Only 15 percent are making a concerted effort to improve patient access with diverse locations and digital connectivity and less than 10 percent see price transparency as a high priority. The managing director of Kaufman concluded that in the age of Netflix and Amazon, consumers expect a lot more from their providers and “consumerism” should be a core capability as it will be a key to long term sustainability. (In fairness to healthcare organizations, they are highly regulated and have nowhere near the access to capital that Amazon and Netflix have.)

Obesity Progress

After several years of rapid increases, national obesity levels have leveled off in 2015 and 2016. Industry observers worry that the relatively “good” news may cause policy makers to become complacent and ease up on the accelerator. Colorado had the lowest obesity rate at 22 percent while West Virginia had the highest rate at 38 percent. Obesity is defined as a body mass index (BMI) of 30 or more. BMI of 30 is about 30 pounds overweight. The highest concentration of obesity is in southeastern states.

ER Usage

Most payers and regulators have historically placed a lot of blame for our high cost of care on unnecessary or avoidable emergency room visits. A recent study published in the International Journal for Quality in Healthcare has debunked the myth that too many people use emergency rooms needlessly. Researchers studied 115,000 records representing 424 million visits over a five-year period and concluded just 3 percent of the total ER visits were “avoidable.” A number of these visits were for things most ERs are not equipped to deal with like dental or mental health problems. About 7 percent of the avoidable visits were for alcohol or mood-related disorders and about 4 percent of the avoidable visits were for dental issues. The researchers defined an avoidable visit as one that did not require diagnostic tests, screening procedures or medications. Researchers concluded that the vast majority of us do not use ERs for primary or routine care and that we need to focus on access to dental and mental conditions after normal business hours.

Physicians Treat All the Same

Historically, government plans like Medicaid and Medicare have not paid physicians as well as most private payers. (Although in recent years private payers have tended to drop their rates closer to Medicare rates.) It would seem that people with poorer paying plans might receive less or worse care than people with better paying plans. While “you get what you pay for” is true in most industries, it is not in healthcare. The vast majority of physicians treat the patient, not their insurance plan. While your plan may not pay for a certain test or procedure, it is of no concern to the physician who is going to do what is best for you in his/her clinical judgment. A recent study proves this, even if in a roundabout way. The study was published in the Journal of the AMA Internal Medicine. It found no difference in the rates that low-value services were provided to Medicaid-covered patients versus commercial/private-covered patients. Physicians tend to order the same low-value (almost useless) tests and services indiscriminately. Also, it does not appear that Medicaid patients are forced to see “lower quality” providers. While the bad news is providers are still ordering “low-value” tests and services, the good news is that none of us are being discriminated against because of our health plan. Just about all providers make it clear up front what insurances they accept, so once you’re in the exam room your insurance is moot.

CVS and Walgreens Sued

Consumers are claiming the two large pharmacy chains failed to inform them that it would be cheaper, less out pf pocket, to simply pay cash for certain medicines vs. going through their insurance. Insurance copayment amounts often exceeded the actual cost of the drug. This fraud is called a “clawback.” For example, the consumer has a $50 copay on prescriptions, but the drug only costs $30. According to the lawsuit, the pharmacy chains are in cahoots with the pharmacy benefits manager Express Scripts.

Aetna and Apple

The health insurance and consumer technology giants are considering making the Apple watch available to Aetna’s 23 million members. Aetna already subsidizes the cost of an Apple watch for its 50,000 employees. According to some remote jobs agencies, this may be just a marketing ploy by Aetna to attract younger tech savvy members since most studies of wearable fitness devices are inconclusive when it comes to showing any improvement in the health of the device wearer. Proponents feel that anything that makes people more health conscious is a good thing while critics are concerned about the invasion of privacy and the potential nefarious use of data derived by the insurer.


The state of Washington leads the country when it comes to helping its seniors “age in place,” according to a study by AARP and The Commonwealth Fund. Everyone prefers to live at home for as long as possible and to avoid a nursing home for as long as possible. The average cost of home care is $128 a day nationwide. The average cost of a nursing home is $230 a day nationwide. Washington state has made support for home-and community-based care a priority. It provides adult day care, assisted living and even foster care as options for the infirmed elderly. This is far preferable to family caregivers as well. Washington also empowers home health aides to provide more care. Through its “No Wrong Door Program,” highly trained staff either answer your questions or direct you to the right place. Washington provides more housing alternatives to nursing homes than most states. Nationwide, about 52 of 1,000 people over 75 reside in an assisted living facility. In Washington, it’s double that.

George W. Chapman is a healthcare business consultant who works exclusively with physicians, hospitals and healthcare organizations. He operates GW Chapman Consulting based in Syracuse. Email him at