RX for Change: Confronting the health care crisis in Kansas

Dec. 9, 2005

By Phyllis J. Zorn

Hays Daily News

One professional calls escalating health care costs "the perfect storm."

"We're basically at a point in time where we know we can't continue to pay it, but there's a continued fascination to tweak the market," said Dr. John Jeter, president and CEO of the Hays Medical Center.

With Kansans spending an estimated $12 billion per year on health care - either out of pocket or through insurance - there is plenty of reason for concern.

There also is growing recognition for change.

Nicole Corcoran, spokeswoman for Gov. Kathleen Sebelius, said the state estimates it will spend $1.24 billion this fiscal year on health care expenses for the poor, such as Medicaid and HealthWave.

That's in addition to other health care costs the state juggles.

State employees' health insurance premiums last year cost $284.5 million. Of that, $126.9 million was paid by employees and $157.6 million by the state, Corcoran said.

The high price of health care caught nearly everyone's attention. Unfortunately, there's no magic pill to cure the problem.

Health care exemplifies what an economist would call "market failure," Jeter said.

"It's one place where the market system clearly doesn't work."

Jeter is a member of the state Health Care Cost Containment Commission, established last year by Sebelius and Insurance Commissioner Sandy Praeger. The commission focuses on ways to reduce costly health care expenses.

There is progress on several fronts, Jeter said, but providing insurance for uninsured working Kansans remains an elusive goal.

It's an issue that calls for change from everyone, he said, including employers, medical providers, insurance companies, lawmakers, drug companies, attorneys and consumers.

Yet, Jeter said, so far "there is absolutely no agreement, no general consensus of what to do."

But there is hope.

- Wellness and exercise programs bring about significant change by helping workers become healthier and fend off chronic illness, which eventually results in lower insurance premiums.

Some employers, such as the accounting firm Adams, Brown, Beran and Ball, promote wellness programs. The company has offices in Great Bend, La Crosse, Colby, Hillsboro, Hays, Hutchinson, McPherson, St. John, Lyons and Ness City.

Nancy Peschka, the chief operations officer and coordinator for the firm's Health Quest program, said she's unaware of comparable programs at similarly sized businesses.

Employees earn points by walking, losing weight and going for regular medical check-ups. They also can take part in special events throughout the year, such as blood drives.

“If they want to attend a wellness seminar, we encourage them to do that,” Peschka said, “and we also bring those in-house.”

The company awards cash prizes, based on points accumulated, at year's end.

“We feel we owe it to our employees to give them every opportunity to balance work and family,” Peschka said. “If we have a happy employee who is well, they're more productive. ... We are able to help control ... our insurance costs for our employees.”

A similar idea has taken hold in the medical industry.

Both Salina Regional Health Center and Hays Medical Center offer employee wellness programs to help their employees become healthier, use their health insurance less and reduce the cost of insurance premiums.

n The state is working to finish restructuring a public and private program that would make health insurance affordable for small businesses. Children of low-wage state employees can enroll in HealthyKIDS, a program similar to HealthWave.

n Insurance companies, too, seek ways to get customers to be more accountable for their health.

“We try to do it by educating the patient,” said Graham Bailey, corporate spokesman for Blue Cross Blue Shield of Kansas.

Bailey said Blue Cross uses several methods to encourage customers to make smarter decisions. They require pre-admission certificates for non-emergency hospitalizations, offer case management services, and supply educational materials for specific health conditions, such as diabetes.

“We're trying to teach them, first of all, to trust their doctors on the procedures they need,” Bailey said. “A lot of things can be changed by quitting smoking, changing their diets and making other lifestyle changes.”

Bailey also pointed to a consumer choice that drives up health care costs — emergency room visits for medical care available at a clinic.

“Fifty percent of all the care rendered in the emergency room is not urgent,” he said. “And that's the worst kind of care, because they just take care of what needs to be done and send you on your way.”

Bailey said Blue Cross paid 90 percent of claims received from 10 percent of their customers last year. The discounts the company negotiated with Kansas medical providers resulted in $900 million in provider write-offs, he said.

n New computer programs in use in many Kansas hospitals aim to reduce the amount of paperwork and reproduction of documents in the health care industry. The information systems give every hospital department the ability to view information entered into the computer system, with the bonus benefit of making the information available immediately to the treating physician needing patients' test results.

n Pharmacists, too, are working to be part of the solution for lowering health care costs. Walgreens recently introduced the “therapeutic interchange program.” When a customer brings in a prescription for an expensive drug, the pharmacist alerts the consumer if there is a less-pricey but equally effective drug available

“We'll call the doctor, and if the doctor says ‘yes,' ... then we change it,” said Michael Polzin, spokesman for Walgreens corporate offices in Deerfield, Ill. “If they are able to change it to a generic, it could drop the co-pay by a considerable amount of money.”

Though some pharmacists look for ways to lower costs for consumers, drum makers are under fire for spending $3.3 billion a year in direct-to-consumer advertising.

Jeter said pharmaceutical companies need to become less interested in making a profit from popular drugs and more interested in finding new drugs to treat disease.

“We need to ‘disincentivize' them to develop a copycat drug and ‘incentivize' them to develop new drugs,” he said.

It's an idea seconded by Rep. Jerry Moran, R-Kan, who believes the cost of prescription drugs will overwhelm the Medicare system. He has introduced legislation to let Health and Human Services negotiate prices of prescription drugs.

But prescription drugs are just one piece of the health care puzzle.

Jeter said he believes the solution for stemming rising health care costs is the single-payer insurance system.

If one entity covered everyone, then medical providers would know what payment to expect for certain procedures, and insurance forms would be uniform, Jeter said.

The United States, he said, needs to develop a system that is uniquely its own in order for it to fit the needs and sensibilities of the country. A carbon copy of another country's health care system won't fit here, he said.

Though no one idea is a magic cure for a complex problem, personal accountability is critical. The routine choices consumers make every day — what to eat, whether to exercise and where to go when medical care is required — affect not just an individual's health and wallet but also how much others pay as well.

The problems causing Kansas' health crisis have been diagnosed. And there are a number of ideas being floated by lawmakers, consumers, employers and others that eventually could become the prescription for change in delivering health care in Kansas and lowering the costs for that care.