Recently, I worked with one of the major health plans to look at over 637,000 consecutive commercial and Medicaid California ED patient visits over a one-year period (excluding ED patients who were admitted to the hospital). Based on the data below, it is clear that those 20% of patient visits that represented the least costly visits (facility plus professional ‘allowable payments’) accounted for less than 4% of the total cost for all non-admitted ED patient visits.
Rank Total Allowed % of Total Allowed
1 $520,314,096 54%
2 $195,156,385 20%
3 $129,376,962 13%
4 $84,949,393 9%
5 $33,929,559 4%
Remember, this data just represents patients who were not admitted (facility costs for ED care of admitted patients are bundled into inpatient payments). Thus, it is likely that the bottom 20% of admitted, discharged, and transferred ED patient visits likely represented between 2 and 3% of the total cost of care for all ED visits. ACEP has been saying for a while now that (depending on the source of the data) ED care accounts for around 2% of the $2.4 trillion spent on all health care costs. Now the estimates of the percentage of ED patients who ‘don’t need to be there’ or have ‘non-urgent’ or ‘non-emergency’ problems is a bit more wide-ranging, depending on the agenda of the estimator; and numbers as low as 10% and as high as 50% get thrown around all the time. The Rand Corporation put the number at 17%, the CDC at 8%, and HCA Gulf Coast Hospitals put the number at 40% !!! Clearly, no one seems to be able to define this group in a standardized way, but it is clear that as the poster child for unnecessary and expensive care, the ED has become the target of many attempts to reduce costs by keeping patients out of the ED, or sending them away, based on screening criteria that may, or may not, meet EMTALA standards. Much has been written about the down-sides of the deferral of ED care strategy, and ACEP has a policy that opposes deferral of care, especially when it is not accompanied by adequate access to alternative care venues and carefully designed programs to arrange for timely and appropriate care for those whose care in the ED is deferred. Most ED physicians agree that the way to reduce unnecessary visits to the ED is by improving access for non-urgent care in clinics and primary care offices. However, my issue with all the hubbub about cost-containment through deferral (or denial) of ED care goes beyond the ethical and risk issues: it simply is not a cost-effective strategy.
Let’s assume that it is possible to accurately identify and screen the patients that do not need ED care without missing the patients who really do have an impending medical emergency in the early stages of presentation, and that we could reasonably eliminate the 20% of ED visits that use the least amount of ED resources. I don’t actually believe this is possible, but let’s make this assumption. If it were, we could reduce the US health care budget by something like 3% x 2%, or 0.06%. But wait- surely some money would have to be spent caring for most of these patients in the clinic or PCP’s office. So perhaps the actual savings from deferral of ED care might amount to 0.05% of the health care budget (50 cents for every $1,000). Probably, the number is even lower. Yes, I know, it is real money, but in relative terms, they call this ‘budget dust’.
The study on ED visits in CA that I mentioned above also looked at costs by procedure and costs by diagnosis for those 637,000 patients. I was surprised to learn that renal and ureteral stones accounted for $25 million of the $963 million spent on all these patients. So, roughly, the same amount of money was spent taking care of 7,900 patients with kidney stones as was spent on taking care of the 127,000 patients who might have qualified for deferral of ED care. In fact, the data from the study suggested that we could save as much money by reducing the number of CT scans done in the ED by 1 out of 12 scans as we could by barring the door of the ED to every single one of the 127,000 patients in this study who accounted for the lowest 20% of ED costs. My point is that all sorts of legislators and health plan executives and government regulators are screaming about, and scheming about, reducing unnecessary ED visits, and distracting us all from focusing on where the real money gets spent, and the real savings could be achieved. You want to talk about saving health care dollars: let’s look at back surgery, depression, end of life care, obesity. But no, the focus of TENCare and HCA and the Dr. Thompson’s in Washington State and elsewhere is on the ‘imprudent’ parent who takes their screaming, vomiting, febrile 2 year old child into the ED at 3 AM, only to be diagnosed with a lowly ear infection. And to top it off, the solution to this problem that many Medicaid program directors and legislators have lit upon, the best way to keep these patients out of the ED, is simply to decide, after the fact, not to pay the ED physician for having provided this care. Yep, that makes a lot of sense.