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Tony Payne Clark Insuranceby Tony Payne, VP/Business Development, Clark Insurance, serving the business, personal and life, health & employee benefits needs of clients in Maine, New Hampshire, and Massachusetts since 1931.

Let me start by saying that if you are reading this article, you are a center of influence and will be better informed about health care than most of your co-workers and/or even your employer. A definition of an “authority” is the person in the room who knows more about the subject than anyone else. So, congratulations, you soon will be an authority.


In the midst of all the fireworks over health care funding, there are two essentials that need to be addressed for the sake of our communities, businesses, and the economy: 1) access to affordable quality health care; and 2) wellness.

As the U.S. Congress and the President debate providing federal subsidies for poor patients, the reality is that people without insurance will be treated as required by federal law if they seek care in an emergency room, the most expensive door in the hospital.

According to a 2013 National Institute of Health study, the median cost of an emergency room visit was $1,233. Debt.org states that a visit to a primary care physician, by contrast, generally runs between $100 to $250. Let’s put that ER visit in perspective. The cost of the median ER visit is approximately one month’s rent in the City of Portland for a two bedroom apartment or three average car payments on a new vehicle.

Now let’s take a closer look at the emergency room data:

  • strains and sprains average cost: $1,498
  • kidney stones average cost: $4,247;
  • urinary tract infections average cost: $2,598.

The federal Centers for Disease Control (CDC) reported that in 2012, there were 136.1 million emergency room visits yet only 43% resulted in a hospital admission. That leaves presumably 57% of ER visits concluding with non-life threatening conditions.

Who actually is paying for these federally required services for the uninsured? It’s the people who have insurance—they are paying for the uninsured through higher insurance premiums for treatment in the most expensive room in the hospital and often for non-emergency care. This funding approach is known as a cost shift. If Americans are removed from subsidized health insurance provided by the Affordable Care Act, it is easy to understand that insurance premiums for those with coverage are going up.

The ER visit is “sick-care” with little prospect of improved overall health. When an uninsured patient is seen in the emergency room, there is no scheduled follow up because the visit will not be covered unless the person chooses to come right back through the emergency room door. Improved quality of life and continuity of care also is unlikely if you are uninsured.

The economics of health care is not rocket science. Someone is going to pay when services are rendered so doesn’t it make sense that we establish federally subsidized health plans that allow people to see a primary care physician? After all, the most expensive patients are those with chronic illnesses whose conditions need to be managed to avoid emergency room visits. According to the CDC, “Chronic diseases and conditions—such as heart disease, stroke, cancer, type 2 diabetes, obesity, and arthritis—are among the most common, costly, and preventable of all health problems.” Data also proves that those with chronic conditions drive the overall cost of health care. For example, about 25% of Medicare spending goes toward medical services during the last year of life—largely treating chronic conditions.

That brings us to the second critical element of controlling health care costs: wellness.

Improved health lowers overall costs. So what gets in the way? No incentives or controls are currently in place to truly change our diet and exercise routines. Most people who lose twenty pounds and feel better nevertheless seem to find exactly what they lost. And, there is little penalty for being unhealthy if you have group insurance coverage.

Despite ample data that a plant-based whole foods diet produces better indicators of health (e.g. blood pressure, blood sugar), we snack and nosh our way through life until we’re scared by a life-threatening event such as diabetes, cancer or heart attack. Even then, we don’t sustain a lifestyle change.

As a center of influence, however, you can assume a leadership role in reducing health care costs at your place of work.

According to a Wellness Forum paper entitled The Case for Using Dietary Intervention to Lower Health Costs at Employer Sites, the best practice for measurable and sustainable results is this:

The best approach to health improvement in the workplace is not to try to talk anyone into anything, but rather to provide information so that people can make informed choices, and provide incentives for them to follow through on those choices. Many people, once they understand the limited efficacy of many traditional drugs and treatments, and the results that can be achieved with diet and lifestyle change, are anxious to make changes right away. Of course, not everyone will be convinced, but over time, as your company’s culture changes, more and more people will buy in.

Won’t there be some employees who will not experience health improvement despite their best efforts because they are genetically predisposed to have certain conditions like high cholesterol?

The role of genetics in disease has been greatly exaggerated. Genetics are important, and it is true that some people are genetically predisposed to develop some conditions like coronary artery disease or diabetes. But how genes express themselves is largely based on the way people live; their diet and lifestyle choices. Genes can be “switched on” by environmental conditions, principally the foods people eat. Genes can also remain dormant based on those choices too, and there is considerable evidence to support this.

Migration studies have shown that when people move from one area to another and start eating the typical diet of their new home, they soon have the same disease risk of the area to which they moved.

For example, Japanese women in the U.S. are significantly more likely to develop breast cancer than Japanese women living in Japan and other Asian countries. One of the reasons is that the traditional Japanese diet is lower in fat, particularly saturated animal fat, than the typical Westernized diet. In the 1940s breast cancer was relatively rare in Japan, and at that time the Japanese diet was comprised of less than 10% of calories from fat.

But within a short time after moving to the U.S., Japanese women have the same risk of breast cancer as American women. Their genetic makeup does not change as they fly across the ocean to their new homes; the main cause is the increase in consumption of fat, particularly fat in animal foods.

The same holds true for other populations and other conditions. Disease rates tend to be related to diet and lifestyle habits, rather than attributable to ethnic groups or heredity.

Almost all people respond positively to the right dietary changes. The small percentage of people who do not respond continue to require traditional medications, but even these people will often require less treatment and their health will improve as a result of diet.

What about compliance after such significant dietary change?

While it sounds counter-intuitive, people tend to be much more compliant after making major changes to their diet and lifestyle than they are when they make minor changes. The reason is that major shifts in diet result in major changes in health status, and most people do not want to return to being sick and taking medications.

Insurance and wellness are the essentials for reducing the trajectory of health care costs. Equally essential, however, is giving patients a financial stake in their health. Data indicates that employers who fund their plans through a health savings account (HSA), experience lower utilization of emergency services and greater mindfulness when purchasing health care services. Use your role as an authority to move your organization in a positive direction and discuss your options with a health insurance broker.

For More Information

Contact Tony at Clark Insurance or a KMA Consultant to discuss.