Diverting avoidable emergency department visits could save healthcare $32 billion annually

Avoidable visits to emergency departments are among the major factors contributing to rising healthcare costs, and of the roughly 27 million annual ED visits by privately insured patients, about two thirds are avoidable, finds a new brief from UnitedHealth Group.

Part of the problem is that primary care services rendered by hospital EDs come with substantially higher price tags than in primary care settings.

In fact, the average cost of treating 10 common treatable conditions at a hospital ED is $2,032, which is more than $1,800 higher than in primary care situations. The ED cost is 12 times higher than at a physician's office ($167) and 10 times higher than at an urgent care center ($193).

The 10 treatable conditions examined in the brief were bronchitis, cough, dizziness, flu, headache, low back pain, nausea, sore throat, strep throat and upper respiratory infection.

WHAT'S THE IMPACT

Higher costs at hospital EDs are partially driven by a couple of different factors.

For one, there are hospital facility fees, which increase the cost of an average ED visit by $1,069.

Then there are lab, pathology and radiology services, which average $335 at an ED. That's about 10 times more costly than at a physician office, where the same services average about $31.

The money adds up. Of the 27 million annual hospital ED visits by privately insured patients in the U.S., 18 million were deemed avoidable, meaning those patients can be treated safely and effectively in high-quality, low-cost primary care settings.

When those 18 million avoidable ED visits are multiplied by an estimated $1,800 cost reduction per visit, that translates to a $32 billion annual savings opportunity if care is diverted to a primary care setting.

THE LARGER TREND

Recently published statistics suggest that Medicaid expansion may play a role in diverting patients away from EDs and toward primary care options. A June study compared ED use in states that expanded Medicaid under the Affordable Care Act with that of non-expansion states, and found that in Medicaid expansion states, patients shifted their use of the ED toward conditions that required subsequent hospitalization, and predominantly for illnesses that were not easily avoided by robust outpatient care.

Those findings indicate that newly insured patients may be relying more on outpatient care for less severe conditions, affecting utilization by avoiding unnecessary ED visits -- effectively freeing up hospital EDs for their intended purpose.

Treatment for new health problems, or acute care visits, encompass over one-third of all ambulatory care delivered in the U.S. Given the high costs of EDs, many insurance plans have created incentives to encourage patients to receive that care elsewhere.
 

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Email the writer: jeff.lagasse@himssmedia.com