Too Smart, Too Late About Your Health-care Costs?

In his book Everything Has Its Price (1995, Simon & Schuster), Richard E. Donley has a chapter titled "The Doctor's Bill." It lists the following costs of medical services:

  • 30-day treatment for alcohol and drug dependency: $12,000.
  • 13-day stay at the Pritikin Longevity Center, Santa Monica or Miami Beach, for a resident lifestyle-enhancement program to control high blood pressure, diabetes, angina, high cholesterol, obesity, smoking, and gout: $6,555.
  • Organ transplants (first-year cost): heart, $209,100; lung, $243,600; kidney,$87,700. Charges are for patient evaluation and pretransplant care, organ procurement, and hospital and physician's fees. Current waiting list (for all organs) is over 30,000.
  • Bypass surgery hospital care: $53,536 (plus doctor's fee).
  • Major joint and limb reattachment (lower extremity) hospital care: $21,299 (plus doctor's fee).
  • Artificial above-the-elbow (prosthetic) arm hospital care: $5,000 (plus doctor's fee).
  • . Appendectomy hospital care: $6,142 (plus doctor's fee).
  • Electric wheelchair: base price, $3,400; customized, up to $20,000.
  • One year's prescription for Prozac (20 milligrams): $761.28.
  • Bottle of milk of magnesia: at a Florida hospital, $33.64; at Kmart, $4.57.
  • Helicopter ambulance service (per flight): $5,000.
  • Ambulance: $175.00.
  • MRI (magnetic resonance imaging) machine: $1 million.
  • Malpractice insurance (annual cost): $117,000.
Health-care costs now exceed 15% of gross national product, compared with 12% in 1992. The costs that hospitals and doctors incur when medical services are provided to uninsured, nonpaying patients continue to be shifted disproportionately (through higher prices) to those with employer-based health-care insurance, rather than to all working Americans. There are still no nationwide standards for approved care. Edith Weiner and Arnold Brown, principals in the consulting firm of Weiner, Edrich, Brown, Inc., New York, tell IndustryWeek that "Health-care costs will soar to 20% of GNP in the next five years. Whether it is life-saving surgery or life-enhancing medicine, plastic surgery, Rogaine, or stress reduction, we are electing to spend more of our disposable income on things that make us feel healthier." The number of companies that offer managed care to employees has increased from 31% to over 60% since 1991. These employers expected to save money because they assumed the level and quantity of services would remain the same. But, unfortunately, many failed to install utilization review programs and, as a result, lost control of the management of managed-care systems. The result? With no controls to keep them informed--or to keep doctors from rescheduling return visits or ordering excessive procedures "just to make sure"--costs jumped 60% in the first year without any noticeable improvement in the health of employees. Obvious conclusion: Changing to a managed care program is much less important than managing the managed-care program itself. Most of us are neglecting the opportunity to educate our employees about preventive techniques that will reduce our health-care costs dramatically.
  • Employee who smoke have more health problems than nonsmokers.
  • Overweight employees have more health problems than employees of average weight.
  • Employees with high blood pressure spend 24% more time in hospitals than employees with normal blood-pressure readings.
  • Employees with poor eating habits ring up health-care costs that are 41% higher than employees with good eating habits.
The fact is that high-risk employees are costing you up to 75% more than low-risk employees. This suggests that one of the keys to lower health-care costs is paying more attention to healthy employees than to the sick ones--and to work harder and smarter to convert high-risk employees into low-risk employees. It's an idea whose time has come--and will go if you don't put it to work right now!
TAGS: The Economy
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