Healthcare News of Note: Americans living in rural areas face an increased risk of death, in part due to issues with healthcare access, says a new infographic

• Americans living in rural areas are more likely to suffer from certain diseases and unintentional injury than their urban counterparts.
• Many workers do not have enough savings to cover their deductible even if it’s under $1,000 per year.
• The cost per treatment for 10 specialty drugs administered in hospitals (2018-2020) was an average of $7,000 more than for the same drugs purchased through pharmacies, while the cost at physician offices was an average of $1,400 higher than pharmacy prices.

Over the last few weeks, I have found these industry news stories that should be of interest to healthcare finance professionals.

1. Infographic: People living in rural areas have an increased risk of death due in part to reduced access to healthcare and further distance from care

“Rural areas often face unique characteristics that put residents at increased risk of death, including older age, reduced access to health care, further distance from care, and higher rates of poverty,” wrote the authors of an infographic published Feb. 24 by the National Institute for Healthcare Management (NIHCM).

Barriers to healthcare in rural areas

Rural Americans often experience “poorer overall health and significant barriers to health care, such as distance and transportation, health literacy, privacy and stigma, and provider shortages,” the authors wrote. 

They added, “These barriers to care have been exacerbated by the COVID-19 pandemic, highlighting health disparities in rural communities.”

Hospital closures and consolidation. Since 2005, 181 rural hospitals have closed across the country and 453 more are vulnerable to closure, according to the infographic’s authors.

“Prior to closure, the average distance between patients and the nearest inpatient care was 3.4 miles,” while after closures, the average distance increased to 23.9 miles, wrote the authors.

Healthcare workforce shortages. “In 2021, 61% of ‘Primary Care Health Professional Shortage Areas’ were located in rural areas,” the authors wrote. “Only 12% of physicians practice in rural communities.”

Number of Americans living in rural areas

According to the infographic:

• Nearly 1 in 5 Americans — more than 57 million in total — reside in rural areas.
• Americans in rural areas are more likely to suffer from heart disease, chronic lower respiratory disease, unintentional injury, stroke and cancer than their urban counterparts.

The impact of COVID-19 on rural communities, efforts to improve rural health and interventions to address access to care are also addressed in the infographic.

2. Workers face mounting healthcare affordability concerns due to health plan cost-sharing features, study says

Workers in the United States are facing mounting healthcare affordability issues due to health plan cost-sharing features such as high deductibles, according to the executive summary of a study by Centivo.

Many do not have savings to cover their deductibles

Many workers, even those with deductibles under $1,000 per year, struggle to save enough money to cover their deductible, according to the findings. Survey results show:

• 43% of those at the highest deductible level ($4,000+ deductible) have an emergency fund of less than $4,000.
• 40% of those with deductibles from $1,000 to less than $4,000 do not have adequate savings levels to account for a major medical expense.
• 25% of those at the lowest deductible level — under $1,000 — run the risk of not being able to cover a major medical expense with their existing savings.

The study authors also said when it comes to deductibles:

• Only one in 10 workers have no deductible as part of their plan
• Workers making more than $75,000 per year are more likely to have no deductible than those in the $50,000 to $74,999 income range

Additional survey highlights

Other key findings from the Centivo survey include the following:

• Medical expenses are a significant cause of mental health and well-being issues for both individuals and families.
• The conventional wisdom that health plan members won’t forgo certain benefits in return for significant savings is false.

The survey was conducted in August 2021 and was comprised of 805 adults, ages 18 to 64, who had employer-based private health insurance for the previous two years.

3. Hospitals charged an average of $7,000 more for certain specialty drugs than the cost of the drugs purchased through pharmacies, says AHIP study

Costs per single treatment for 10 specialty drugs  were an average of $7,000 more when administered in hospitals and $1,400 more when administered in physician offices than when those drugs were purchased at pharmacies, according to a study published by AHIP (formerly known as America’s Health Insurance Plans) on Feb. 16.

The study presents the average markup of the same single treatment of 10 specialty drugs — Botox, Herceptin, Keytruda, Ocrevus, Opdivo, Prolia, Remicade, Rituxan, Tecentriq and Xolair — by hospitals and physicians offices from 2018 to 2020 when compared with the cost of purchasing the same drugs at pharmacies.

A sample of the average markups for two of the drugs, according to AHIP:

Ocrevus

• Hospitals: 59%,
• Physician offices: 13%

Prolia

• Hospitals: 215%
• Physician offices: 49%

The study authors wrote, “The list of drugs included in the study was obtained … from the list of top 25 drugs by spending in Medicare Part B in 2019.” AHIP then identified, “in consultation with our member plans, the drugs that are also commonly delivered through specialty pharmacies. The resulting list included 10 drugs.”

HFMA bonus content

• Register for HFMA’s Annual Conference to be held June 26-29 in Denver and virtually, with renowned healthcare industry leaders and influencers set to speak about everything from cost effectiveness of health and leadership to the latest trends in revenue cycle management and payment innovation.
• Check out HFMA’s 2021 Thought Leadership Retreat summary report: 10 Building Blocks of Cost-Effective Health.
• Listen to the latest “Voices in Healthcare Finance” podcast where Jess Roberts from the University of Minnesota discusses how the iterative process of design thinking can help healthcare organizations solve problems.