Health plans are launching lower-cost options, including digital visits, to reduce ED use.


March 13—Insurance executives and governors are taking new steps to reduce inappropriate use of emergency departments by plan enrollees.

Scott Pattison, executive director and CEO of the National Governors Association (NGA), told a gathering of insurance executives this week in Washington, D.C., that one of the delivery system reforms on which chief executives of states are focused this year is keeping more Medicaid enrollees from unnecessarily seeking care in the high-cost ED setting.

Gubernatorial staff focused on health care “are almost surprised at how difficult it is to break that culture and also the incentives of going to the emergency room,” Pattison said at the annual policy meeting of America’s Health Insurance Plans. “But the cost I think is so high that the incentive would continue, as hard as it is, to figure out how to deal with this.”

The latest federal data, from 2015, found a an increasing proportion of Medicaid patients were using the ED. That year, for the first time the share of Medicaid patients using the ED (34.8 percent) surpassed the share of privately insured (34.3 percent) who did so. Centers for Disease Control and Prevention (CDC) data found 3.5 percent of Medicaid enrollees’ ED visits were “nonurgent” and another 7 percent were semi-urgent (the two lowest classifications among five levels) in 2015.

In addition to high costs, ED overuse has been found to contribute to overcrowding and boarding, which are associated with poorer patient outcomes.

Among state Medicaid program responses, some states are trying to decrease costs for physician practice visits and to get pharmacies to provide more care, Pattison said.

Other Types of Efforts

Hemi Tewarson, director of the health division of the NGA, said states have aimed to reduce ED use among Medicaid patients through targeted case management and by addressing the social determinants of health, like unsecure housing. That focus stemmed from findings that the highest ED costs were driven by Medicaid patients with behavioral health or housing needs.

Tewarson  said in an interview that unnecessary utilization by children with minor illnesses was an issue “but that wasn’t the highest line item for the states.”

In response to one health plan that surveyed Medicaid enrollees and found that lack of access to physician offices drove unnecessary ED use, Tewarson cited the success of some Medicaid insurers with the primary care medical home model. That model targets designated populations such as behavioral health patients for preventive care.

However, in more rural states the lack of providers continues to challenge Medicaid diversion efforts, Tewarson said. One newer initiative aims to expand the services of federally qualified health centers, many of which operate in more-rural areas.

The recently released Trump administration budget would increase the statutory limit on Medicaid copayments for nonemergency use of EDs for states that request authority to increase the limit. The change was projected to provide $1.6 billion in federal savings over 10 years.

However, Tewarson said such ED cost-sharing is not an approach that comes up in the NGA’s work with states to reduce Medicaid patients’ ED use.

“Some more of the expansion states have figured out more techniques through things like focusing on complex care, figuring out primary care medical homes,” Tewarson said. “They’re still learning, but I think there is some progress being made.”

Pattison expects that governors’ efforts on ED use reduction—as with all cost-saving delivery system innovations—will get another boost when state finances tighten in the next recession.

Health Plan Responses

Among commercial health plan efforts to control costs from ED use—and from the admissions they drive—was the launch by Florida Health Care Plans of emergency-physician facilities to compete with hospital EDs.

“We are not beyond creating competition in the marketplace,” said Patrick Geraghty, president and CEO of GuideWell, the plan’s parent company.

The insurer’s initiative followed its finding of admission rates for ED patients that were “exponentially higher” than rates it saw in other geographic areas, Geraghty said.

“Not being able to move that dial with them, we decided to create competition,” including opening an alternative facility directly across from one hospital’s ED.

The appeal of such facilities stemmed partly from efforts to make them much more inviting for ED patients through greater privacy and lower costs, while accepting patients from all payers.

“It got their attention and they behaved differently as a result of it,” Geraghty said, about inpatient admissions by the targeted hospitals.

The health plan also bought PopHealthCare about a year ago-to provide care for the chronically ill in the home setting. The service operates in nine states, and GuideWell plans to spread it across the country, Geraghty said.

Andrea Walsh, president and CEO of HealthPartners, which operates an insurance company and health system, credited the increase in the number of urgent care centers in recent years with decreasing ED utilization.

“From an affordability and simplicity standpoint, that is a really great trend,” Walsh said.

HealthPartners also has sought to control ED use with the launch of virtuwell, an online 24-7 service that is billed as a primary care option available on mobile devices.

HealthPartners uses data analytics to look for inappropriate ED use by its enrollees, hoping to break such patterns of care-seeking by notifying them of lower-cost treatment options.

“We want to help people create a new pathway because we are all figuring this out,” Walsh said. “We’re saying ‘You know what? The next time you need care, did you know that there is this urgent care facility? Did you know with virtuwell you can get care?’”


Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Thursday, March 14, 2019