Insurance Execs: Private Option Recipients Use ER Five Times More Often

Enrollees in the state’s private option visit the emergency room at five times the rate of the rest of the Blue Cross population and are less likely to use their primary care physician, but those who use that physician do so with greater frequency, legislators were told Thursday.

Sam Vordestrasse, vice president, actuarial services and chief actuary for Arkansas Blue Cross Blue Shield, and Matt Flora, director of medical informatics, testified along with executives from other insurance companies before the Health Care Reform Legislative Task Force.

The task force was formed during this year’s legislative session to study overall health care reform, including the private option. The private option is the state program that uses Medicaid dollars to purchase health insurance for lower-income Arkansans.

The two said the company is trying to encourage private option recipients to visit their primary care physician rather than the emergency room, which is more costly.

But that will require breaking old habits and dealing with some current realities, said Mike Stock, president and chief executive officer of Qualchoice. Stock said private option recipients are more likely to have multiple diseases. They more often visit the emergency room for non-emergency situations, likely because they often did not previously have insurance and have less understanding of how to navigate the health care system. Some recipients may also visit the emergency room because they don’t want to take off work to visit the doctor during the day.

Private option recipients average fewer prescription drug claims than the rest of Qualchoice’s population, perhaps because they more often seek care in the emergency room, where drugs are less likely to be prescribed, Stock said. But they tend to fill a higher percentage of generic prescriptions rather than name brands. Stock theorized that they may see fewer commercials for name brand drugs on television and are less likely to request them of their doctors.

John Ryan, president of Ambetter of Arkansas, also testified that his company’s private option beneficiaries are more likely to use the emergency room than other populations.

Legislators asked what carrot-and-stick approaches could be used to encourage private option recipients to access the health care system more appropriately.

The stick – a financial penalty – would require a waiver from the federal government. Many private option recipients pay no co-pays, giving them no incentive to avoid using the emergency room, said Sen. Bryan King, R-Green Forest.

The task force was created as part of a legislative compromise that funded the private option through the end of 2016, with the idea being to perhaps replace it after that.

Stock noted the program’s uncertain future when asked about his company investing in educating its private option recipients.

“Right now I have a customer that I don’t know if they’re still going to be a customer in 18 months,” he said.