Helping Emergency Department Clinicians Understand the Costs of Care

Increasing clinicians’ knowledge of emergency department 
costs presents an untapped opportunity.

In this interview, Kevin A. Hoffman, DO, an emergency medicine physician at Lakeland Health, St. Joseph, Mich., describes opportunities to improve emergency department clinicians’ awareness of the costs of care.

On why the ED is an ideal setting to engage clinicians with cost information. Hoffman is the lead author of a study, “Emergency Health Care Professionals’ Understanding of the Costs of Care in the Emergency Department,” published in The Journal of the American Osteopathic Association. He found that on average, only 38 percent of physicians, physician assistants, and nurse practitioners accurately estimated costs of caring for ED patients with one of three conditions: abdominal pain, dyspnea (difficulty breathing), and sore throat. The results were based on an online survey of more than 440 clinicians with varying levels of experience from across the country.

He also found that even though attending physicians with at least five years of experience perceived they had a better understanding of costs, their cost assessments were no more accurate than their colleagues with less training.

Hoffman was not surprised by the results because the costs of ED care were never covered in his own education. “During medical school, I asked my mentor at the time about the cost of a blood test, and he didn’t know,” he says. “Ever since that conversation, it stuck with me that excellent physicians with a lot of experience don’t have all the knowledge that they should have about the tests they are ordering. They understand that tests cost more in the ED than in outpatient settings, but they don’t know how much the tests cost or what the costs are to the patient or the healthcare system.”

Many clinicians also fail to understand costs beyond their immediate purviews. These include room fees, nursing fees, and radiologist fees associated with many tests or procedures ordered by clinicians.

However, increasing clinicians’ knowledge of ED costs presents an untapped opportunity for organizations because ED costs typically surpass costs in other healthcare settings. “The ED is a good place to try to decrease unnecessary utilization in a safe and effective manner and, in turn, decrease costs to the patient and the healthcare system overall,” he says.

Understanding cost variances also can help ED patients avoid financial harm, particularly as more of them face higher deductibles. “If we could focus more on improving the knowledge of costs in an emergency department, there is a high likelihood we would have higher efficiency and savings,” he says. “This is not a philosophical argument. This will have a legitimate impact on people who might be struggling with healthcare costs.”

On the taboo of talking about costs. Many clinicians still feel uncomfortable talking about costs or considering costs in their thought process, Hoffman says. “Cost should never be the deciding factor on whether a test is performed, but that becomes so ingrained in our training that perhaps physicians become reluctant to talk about costs at all,” Hoffman says. “However, being aware of the costs of care while still making medically appropriate decisions is a better way to think about what you order.”

For example, costs vary considerably depending on whether a medication is given orally or intravenously. “As long as those differences don’t impact patient care, it is not unreasonable to use a cheaper form of the medication, which is typically the oral form, rather than the intravenous form,” he says.

On what finance leaders can do to help ED physicians understand the cost of care.  Hoffman suggests finance leaders support investments and strategies to improve clinicians’ awareness of costs, such as including care costs in the computerized physician order entry system (CPOE) in the electronic health record (EHR). “Other research has shown that doing so can decrease costs while maintaining high levels of care,” he says.

Hoffman recognizes the efforts of his organization, Lakeland Health, which has begun including the costs of various therapies in its CPOE system. For example, if an ED clinician chooses to order acetaminophen, a pop-up box opens, providing comparative cost information associated with each dosage and formulation option. The cost differences can be substantial: The oral formulation of acetaminophen is less than 5 cents a dose, while the IV formulation is $75 per dose. “The system doesn’t prevent you from ordering the more expensive medication or give you any roadblocks, but it’s a reminder that if the differences between the formulations do not impact patient care, the physician may want to try the oral dose,” he says.

Besides supporting technology, finance leaders can collaborate with department leaders to improve clinicians’ financial knowledge. “It is time that we begin to have some focused education for physicians on costs,” he says. Recognizing that the education should not burden clinicians, Hoffman suggests short, easy-to-complete training, such as self-study slide presentations that review the basics of ED organizational costs. For example, the presentation might cover how the basic room fees in an ED vary depending on the patient case.

Finance leaders also might collaborate with a clinician leader on formal in-person education for ED physicians, perhaps in the form of a short presentation during a department meeting. “The education should come from the director, whom they respect and work with on a daily basis, but finance should be involved in its preparation,” he says.

Laura Ramos Hegwer is a freelance writer and editor based in Lake Bluff, Ill., and a member of HFMA’s First Illinois Chapter.

Interviewed for this article:

Kevin A. Hoffman, DO, emergency medicine physician, Lakeland Health, St. Joseph, Mich..