Dec. 14--The push has been on for consumers to be more aware of the costs before making their health care decisions. It seems they are -- and it's not good news for health care facilities already smarting from stagnating insurer payments for the care they offer.
The number of surgical operations done at Western Pennsylvania hospitals fell by nearly 6,670 combined cases -- 2.7 percent fewer inpatient surgeries and 0.77 percent fewer outpatient cases -- for the 12 months ending June 30 when compared to a year ago, according to a report by the Healthcare Council of Western Pennsylvania, a Warrendale-based trade group.
The reason: health insurance plans that come with deductibles ranging up to $10,000, said Denis Lukes, the council's CFO.
High deductibles that have to be satisfied before coverage kicks in are forcing patients to delay, and in some cases forgo, surgery. And surgery is a big source of hospital revenue, Mr. Lukes said.
"It's one thing to say I have insurance," Mr. Lukes said. "It's another thing to say I have insurance that allows me to accept coverage under terms of that coverage.
"We talk about it in virtually every meeting I'm in."
Hospitals are often the biggest employers in the counties where they are located, so a drop in revenue can prompt belt-tightening that ripples through the community. For the year ending June 30, for example, overall hospital employment in the region declined by 1,540 jobs or 2.26 percent when compared to 2014 as hospitals battled higher costs and stagnant reimbursement from insurers.
Hospitals also pared $6 million in salaries and $52 million in benefit costs in fiscal 2015 when compared to the previous year, the council found.
Surgery is the lifeblood of hospitals. Mean hospital costs in 2012 were highest for surgical stays at $21,200. That's 2.5 times the mean costs for medical stays at $8,500.
Surgical stays accounted for 49 percent of the total $377.9 billion in hospital costs in 2012, according to a study by the Agency for Healthcare Research and Quality, a government agency that tracks the quality and cost of medical care.
The three most common operating room procedures in 2012 were: knee replacement, which increased more than 50 percent between 2003 and 2012; hip replacement; and coronary angioplasty, in which a guided wire is threaded through a heart vessel to clear a blockage or implant a wire mesh stent.
The slowdown in surgeries more recently is not isolated to this region. Average annual growth in hospital costs slowed to 1.7 percent between 2008 and 2012 when compared to the 5.4 percent rate of growth between 2003 and 2008, according to the Agency for Healthcare Research and Quality.
The slowdown was attributed to moving some simpler procedures to outpatient centers and also to fewer hospital stays overall for surgery.
While operating income for Western Pennsylvania hospitals rose 126 percent from $220.1 million to $498.1 million during fiscal 2015, 13 of the 59 hospitals surveyed, or 22 percent, reported a net revenue decrease for the year.
Washington Hospital was among the facilities reporting essentially flat surgical rates. For the three months ending Sept. 30, for example, the number of operations was off 1.8 percent. Anecdotally, surgeons have been reporting that patients have been more often likely to postpone operations, hospital President and CEO Gary Weinstein said.
"Outpatient surgery is pretty well paid," Mr. Weinstein said. "It can be a revenue hit."
Considering the higher health insurance deductibles many plans have, the decline in surgeries at Western Pennsylvania hospitals isn't surprising, said Dr. David DeMarino, an ear, nose and throat surgeon who has offices in Bethel Park.
"It's just common sense when people have to pay more out of their pocket, they're better consumers," said Dr. DeMarino, who has been in practice for 30 years. "The deductibles are affecting surgeries."
Many operations are elective, meaning surgery is among several options that patients have in treating a particular problem. But for others, surgery is the only option, and Dr. DeMarino said he finds a way to convince patients to get the procedure done.
Kris B. Mamula: kmamula@post-gazette.com, 412-263-1699
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