HEALTHCARE

Healthcare is a massive cost driver! This is not only true at the individual level, but also at the employer level (City Muskogee). Although it's not a simple issue to tackle, there are some steps that can be taken to identify and potentially slow, or decrease, rising healthcare expenditures.

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One way to address rising healthcare costs, as simple as it may sound, is to become a "shopper" of healthcare goods and services. As an example, there are shocking disparities in cost for an MRI. I'm always surprised to hear that if I pay cash rather than utilizing insurance, an MRI may only cost $500 rather than upwards of $1,500. This is why traditional health insurance networks don't always equate to cheaper healthcare costs. Many of our largest healthcare systems are reimbursed at much higher rates than some of their competitors; this can be due to collection issues (time value of money), or merely leverage that affords higher reimbursements. Either way, this inevitably results in insurance cost sharing (co-insurance) being calculated at a higher total cost.

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Another way to address rising healthcare costs, especially at the employer level, is to constantly assess whether or not a health benefit plan provides the best "bang for the buck". As an example, fully insured health benefit plans do not always offer the same flexibility of benefits and financial exposure that self-insured plans do. Many burdensome regulations that occur at the state level do not exist at the federal level. Therefore, it's important to weigh the costs with each.

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Am I saying the City of Muskogee is incorrectly managing its healthcare benefits and corresponding expenditures? Not at all! What I am saying is that these benefits have to be re-assessed constantly and there has to be an awareness that the same principles that apply in other industries, do not always apply in healthcare. I am routinely amazed at how complicated, convoluted, and distorted the American Healthcare System operates.