FORT WAYNE, Ind. (WANE) — With the statehouse brewing possible legislation to curb hospital prices, Parkview Health gave WANE 15 an exclusive look at its Signature Care 2.0, a partnership with select employers designed to lower health care costs.
“Our job at Parkview Health is to make our regional employers as competitive as they can be,” explained Dr. Greg Johnson, Parkview’s Regional Market President. “We’re a not-for-profit organization fully invested in northeast Indiana. We benefit when we lower those costs because it draws more companies to our region.”
Typically, five percent of any population, including a workforce, drives 50% of health care costs. In theory, companies would save a great deal if they could improve the chronic health conditions of that five percent by eliminating things such as Type 2 diabetes or obesity.
Two years ago, Parkview gathered employers that self-insure and have low employee turnover. Could they leverage the relationship their workers already had with their primary Parkview Physician to improve their health habits and escape their chronic illnesses?
Parkview put skin in the game by offering to split the cost of any over-budget spending; likewise, Parkview would share in any annual savings.
Four employers joined the experiment.
Johnson said the results look promising with about 72% engagement from the targeted coworkers. The national average for similar programs is engagement in the single digits.
“They’re engaged,” said Johnson. “They’re not just taking a phone call.”
Parkview physicians are engaged, too. Rather than the traditional fee-for-service model, doctors are encouraged to offer a value-based care with an emphasis on keeping patients healthy to avoid more expensive procedures down the road.
“We want to keep people out of the hospital,” Johnson said. “And you’re talking to someone who runs the hospitals.”
Alex Kiefer, CEO at Lutheran Life Villages, said Signature Care 2.0 has “bent the curve” of their health care cost projections. He said the five percent that represents their most expensive employees might account for as much as 70% of their costs.
“As a nonprofit organization, stewardship of our dollars is really important,” he said. “With health care costs a few years back jumping every single year, we had to look at what else can we do? How can we make this effective for our employees?”
Health care costs at East Noble School Corporation fell significantly under the program, too.
“When other companies are seeing medical costs increase anywhere from 12 to 18 percent, East Noble is looking at anywhere from three to seven percent,” said CFO Brian Leitch.
Those savings did not impress everyone.
Ball State University economist Michael Hicks, a frequent Parkview critic, called the plan “a gimmick.”
“Patients at Parkview pay more than 400% of Medicare costs and almost 90% more than the average American for the same services,” Hicks emailed WANE 15. “If it were truly reducing costs to the national averages, [employers] would be seeing years of double digit price declines.
“Parkview is doing this because they are under national scrutiny for the damage their monopoly pricing has done to families and businesses in their healthcare markets.”
Johnson, however, had a different message for lawmakers.
“It isn’t about price, and our legislators should hear that,” he noted. “It’s about the total cost of care.”