Published July 22, 2019
Health care spending in the United States is expected to grow from $3.5 trillion in 2017 to $6 trillion by 2027, according to the Centers for Medicare & Medicaid Services. As a result, the health share of GDP is expected to reach nearly 20 percent
What’s driving the dramatic increase in spending? Price variation, which leads to overspending by many consumers.
However, UnitedHealth Group has conducted extensive research on the cost of care and has identified four areas where savings are achievable:
This article focuses on avoidable hospital ED visits.
According to UnitedHealth Group research, two-thirds of hospital ED visits annually by privately insured individuals in the United States – 18 million out of 27 million – are avoidable.
An avoidable hospital ED visit is a trip to the emergency room that is primary care treatable – and not an actual emergency. Ten common primary care treatable conditions frequently treated at hospital EDs are bronchitis, cough, dizziness, flu, headache, low back pain, nausea, sore throat, strep throat and upper respiratory infection.
The average cost of treating common primary care treatable conditions at a hospital ED is $2,032, according to UnitedHealth Group. That number is 12 times higher than visiting a physician office ($167) and 10 times higher than traveling to an urgent care center ($193) to treat those same conditions. In other words, visiting either a physician’s office or an urgent care facility instead of a hospital would save an average of more than $1,800 per visit – creating a $32 billion annual savings opportunity systemwide.
What is driving the higher costs at hospital EDs? Higher costs are driven in part by hospital facility fees, which increase the cost of an average hospital ED visit by $1,069, and lab, pathology, and radiology services, which average $335 at a hospital ED – 10 times more costly than at a physician office ($31).