Managing healthcare costs: A return to primary healthcare providers

01 October 2010 Katy Caldis, Fedhealth

Rising healthcare costs, the current credit crunch and concerns about Government’s drive to implement National Health Insurance are creating a challenge for many medical schemes.

Katy Caldis, CEO of Fedhealth, says one of the biggest challenges facing medical schemes is to keep the monthly contributions members pay within acceptable limits. “Rising hospital costs are a particular concern for schemes, as is the high level of claims from members who consult specialists.

Fedhealth, for example, sees hospital costs accounting for 40,9% of the claims submitted by its members, with another 21,9% going to specialists. Medicines account for 15,6% of claims.

Managing inefficiencies

Caldis believes the solution does not lie in trying to reduce income of healthcare professionals who should be appropriately remunerated, but rather through removing wastage and inefficiencies from the system, resulting in cost savings that will benefit members and schemes. There needs to be a drive towards encouraging members to return to primary health care providers.

“Currently a large percentage of members go directly to specialists, instead of firstly consulting a primary health care professional. We need to start working more closely with providers in order to get the balance right and bring down costs.

"One of the ways of doing this is by contracting GPs in the interests of both the member and the scheme. This involves ensuring no out-of-pocket payments for members visiting contracted GPs and by assisting GPs in the network to practice more cost effectively. GPs are profiled and encouraged to improve the quality of care delivered and encouraged to be the coordinator of care for each patient. Members then need to be educated on and encouraged to use GPs.”

Working with pharmacies

Schemes should also be working closely with pharmacies to drive down costs. “We have already concluded our pharmacy negotiations around dispensing fees and have looked carefully at generic substitution and various drug interactions,” she says. The next step is ensuring members understand the benefits of this type of arrangement and the resultant savings that can be achieved.

All-round benefits

“The return to primary healthcare providers will without a doubt help schemes keep monthly contributions within acceptable limits for members. It also has the added benefit of offering patients a more accurate overall health assessment. GPs are specialists in assessing the body as a whole and often pick up health issues that patients may not be aware of. This can lead to early prognosis and treatment without the need for a visit to a specialist,” says Caldis.

“While brokers play a valuable role in educating members and advising them of their different options, members also need to carefully look at which option caters to their specific life stages and offers real medical benefits. It is imperative that members assess their individual current healthcare needs based on their age, family composition and health status. We have already started the process of steering our members towards taking greater responsibility for their own health and our 2011 strategy aims to really establish this mindset.”

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