Coordinating Healthcare Services is Key to Bringing Costs Down Says Chamber Panel at Breakfast for Business Event

“We are not succeeding at managing healthcare costs,” according to New Jersey State Assemblyman Gary Schaer, during the Chamber’s April 17th Breakfast for Business Event: Reining in Your Healthcare Costs.  “Healthcare, if it is not the largest industry, then it soon will be in this country,” added Schaer, who is also the Deputy Speaker and represents District 36.

The current healthcare model is simply unsustainable and bankrupting the U.S., noted fellow panelist Wardell Sanders, Esq., President of the NJ Association of Health Plans, during his opening remarks at the Chamber’s first panel discussion to focus on healthcare, which took place at the Jersey City Museum and was sponsored in part by Saint Peter’s University and the Jersey City Medical Center.  In addition to Schaer and Sanders, panelists included Joseph Scott, President and CEO of Liberty Health; and Dr. Douglas Ratner, Chairman of Medicine at the Jersey City Medical Center.

The panel discussion, moderated by Nicholas Chiaravalloti, Executive Director of the Guarini Institute for Leadership and Government, was intended to bring to light those factors that are driving the continual rise of healthcare costs, particularly in New Jersey and Hudson County.

According to Scott, a number of factors play a role in driving up costs, and primary among them is the increasing tendency of patients to visit emergency departments for their first point of entry into the healthcare system when there may be other, more cost-effective options. Two other factors that Scott noted include the number of orders that physicians make when patients are admitted to the hospital or visit the ER and the cost of end-of-life care.  “New Jersey is tops in this last category,” Scott explained, as families understandably want their loved ones to be provided the best possible care during the last stage of their life.

“The paradigm is going to change and has already started to,” explained Scott with regards to our current system of delivering care.  He noted as one example that the JCMC is setting up community-based facilities where patients can receive care before their medical condition is critical and forces a visit to the ER.  In the future, online technology may also make it possible for patients to have access to healthcare professionals in ways never before possible.  And regarding end-of-life care, Scott proposes that healthcare practitioners are going to have to begin engaging a patient’s entire family in discussions around providing appropriate care during those final weeks and months.

Panelists included (left to right): Joseph Scott, President & CEO of the Jersey City Medical Center; the Hon. Gary S. Schaer, Deputy Speaker of the NJ State Assembly; Wardell Sanders, Esq., President of the NJAHP; Dr. Douglas Ratner, Chairman of Medicine at JCMC.

Panelists included (left to right): Joseph Scott, President & CEO of the Jersey City Medical Center; the Hon. Gary S. Schaer, Deputy Speaker of the NJ State Assembly; Wardell Sanders, Esq., President of the NJAHP; Dr. Douglas Ratner, Chairman of Medicine at JCMC.

Managing patient care during an individual’s entire hospital stay and ensuring coordination of services to drive savings is key to bringing costs down, was a sentiment shared by many of the panelists.  Sanders noted that essentially 85% of insurance premiums are directed to pay claims for hospitalization costs.  He added that while health plans, hospitals and physicians are increasingly trying to align incentives to bring costs down, nationally there is structurally a high base for insurance premiums.   In New Jersey, he further explained, the regulatory climate forces even higher premiums and cost shifting of healthcare services to the private sector. In Hudson County, the growth of out-of-network costs are driving costs “off the charts”, said Sanders.  “Hospital costs in Hudson County far surpass the same costs in other counties in the State.”

Sanders advised that a statewide healthcare exchange, mandated by the federal Affordable Care Act, may bring relief to individuals in the market for health insurance as there will be subsidies available for lower income individuals, but small employers will likely not see any significant cost savings by using an exchange.

“There is no silver bullet to bring costs down,” noted Schaer.  “The task is gargantuan and the system has become bastardized for better or worse.” He advised that while the healthcare system can not be re-set to zero,  policy makers and experts can effect pieces of the puzzle.

This is exactly what hospitals such as the JCMC are tying to effect by working on demonstration projects with the federal government that focus on coordinating patient care to drive efficiency, explained Scott.  Dr. Ratner also noted that healthcare providers need to develop treatment protocols that are cost effective and that industry experts need to be involved with policy makers to find solutions.  One solution to bringing down costs, he noted, may be for small employers to contract directly with medical centers for employee healthcare plans.

The panel discussion, conceived by the Chamber’s Government Affairs Committee, was the first event to explore healthcare issues. “Hopefully there will be more opportunities for our members to dialogue on the healthcare industry and how the sector impacts business. As we are all aware, it’s a preeminent issue,” said Maria Nieves, President and CEO of the Chamber.

Photos from the event are available on the Chamber’s Facebook page.

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