Expect Emergency Room Visits to Soar

One of the most oft-repeated arguments for health reform is that uninsured patients make costly and delayed trips to the ER when they do not have a health plan that pays for care at physicians’ offices. Insure the uninsured, it is said, and they will decrease their reliance on the ER and get prompter, less costly care elsewhere.

Yet, as an AP story reported the other day, ER traffic in Massachusetts is higher than ever before. And as I predicted at the Health Affairs Blog, the number of such visits under the new national health reform is likely to soar.

Why is that? As we pointed out in a recent National Center for Policy Analysis Brief Analysis, the use of the emergency room by uninsured patients is not that much different than usage by the insured. The heaviest users of the ER (in proportion to their numbers) are Medicaid patients, probably because Medicaid rates are so low that physicians are not anxious to see them. And the reason why that is important is that more than half of the people who gain insurance under the new health reform bill will enroll in Medicaid.

At this point, any attempt to predict what will happen is very speculative. Yet a few back-of-the-envelope calculations convince us that there is reason for concern.

Predicting Emergency Room Use Based on Change in Health Insurance Status. For ease of calculation, here are some simplifying assumptions. Suppose that 1) half the uninsured obtain insurance; 2) the newly insured enroll 50/50 in Medicaid and private plans; 3) the newly insured are representative of the uninsured population in terms of emergency room use while they were uninsured; and 4) the newly insured behave in a way similar to other enrollees in the plans they join. Under these assumptions:

  • Among the newly insured under age 18, the number going to the emergency room each year will climb from 18 percent to 22 percent.
  • Among those ages 18 to 44, annual emergency room traffic by the newly insured will increase from 21 percent to 28 percent.
  • Among those ages 45 to 64, the increase will be from 19 percent to 28 percent.

In terms of the actual number of visits, insuring between 32 million and 34 million additional people will generate between 848,000 and 901,000 additional emergency room visits every year.

Predicting Emergency Room Use Based on Health Care Rationing. In general, people with insurance consume twice as much health care as the uninsured, all other things equal. The trouble is that the new health insurance law has no provision for increasing the number of health care providers. As a result, when people try to increase their use of physician services, many will be disappointed and a large number are likely to turn to the emergency room when they cannot get their needs met at doctors’ offices:

  • Whereas the uninsured make almost two physician visits per year, the number is more than 3.5 for the privately insured and almost 7.5 for Medicaid patients.
  • On the average, we estimate the typical newly insured patient will attempt 3.6 additional physician visits.
  • If, say, only one-third of these turn to the emergency room because of inadequate primary care supply, that would equal between 39 million and 41 million additional emergency room visits every year.

Qualifications. There are a number of reasons why these estimates may err on the high side: 1) the people we call “newly insured” may be people who would have had insurance for part of the year anyway, 2) they may be sicker than the pool of uninsured that they leave or 3) they may be healthier than the pool they join. Nonetheless, it seems highly likely that emergency room visits will be substantially higher under the newly enacted health reform law than they are today.

Another possibility is that the administration will somehow be able to increase supply. At www.healthcare.gov, the administration now claims it will train 16,000 new providers by 2015. Yet Congress has never appropriated the funds to do that. In fact, all funds for training new providers were zeroed out of the Patient Protection and Affordable Care Act. (That was one of the ways Congress kept the CBO spending score as low as it was!) Apparently, HHS Secretary Kathleen Sebelius plans to use $250 million targeted for “prevention and public health” in the bill to instead train 500 physicians, 600 physician assistants and 600 nurse practitioners. Also, she plans to use an additional $500 million of “stimulus” money created under the American Recovery and Investment Act. Even so, this will fall way short of the 16,000 figure.

Meanwhile, the Association of American Medical Colleges predicts a 21,000 primary care physician shortfall by 2015, and the Health Resources and Services Administration at HHS estimates a shortage of between 55,000 and 150,000 physicians by 2020 and that was before health care reform passed!

 

Comments (13)

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  1. Virginia says:

    If the emergency room is the safety valve of the health care industry, then it’s only logical to think that use would increase as the system is squeezed. In theory, this additional demand for ER visits would lead to the next form of rationing: long wait lists.

    This is already the case at many ER’s, and it will likely continue to be the case. You would hope that people would start going to local urgent care clinics (I noticed that there are 3 new clinics in my hometown that specialize in non-life-threatening problems). You might actually start to see consumers making their own choices.

  2. LAURENCE BRODY says:

    The whole issue is taxation. I don’t think administration cares one way or another as long as those with taxable estates die earlier.

  3. Devon Herrick says:

    People thought the problem of ER over-crowding would go away when everyone has health coverage. But, access to coverage isn’t the same as access to care. When Medicaid enrollees lack access to a primary care provider but (theoretically) have coverage, they will visit the ER for trivial medical conditions knowing that Medicaid will pay the bill.

  4. Bart Ingles says:

    “One of the most oft-repeated arguments for health reform is that uninsured patients make costly and delayed trips to the ER…”

    I’ve always thought that this was more of a supplemental argument used by people attempting to gloss over cost issues. I can’t believe anyone is honestly in favor of reform on the basis of this claim.

  5. Joe S. says:

    Nice report. And unfortunately, probably very true.

  6. Larry C. says:

    I think the problem is going to be even worse than what you are predicting. You haven’t even considered the “free” preventive care everyone is going to get. That will make the doctor shortage even worse.

  7. Vicki says:

    I think this is going to be about 10 times worse than what has happened in Massachusetts.

  8. Catherine says:

    Too many people drop and run to the emergency room for health issues and injuries that could be treated for a lot less time and money at either retail clinics or stand-alone emergency care centers. I am amazed at the number of people I know who never heard of these options. They think they can only choose between their doctor’s office and the ER. Around the country, many of the major drug store chains have in-store clinics open days, nights and weekends that can treat flu, sinus infections, bladder infections and the like. Stand-alone, emergency care centers can do stitches, X-rays and higher level care, and many are open 24-7. I’ve used both with my family and saved several grueling ER waits and a lot of dollars. It’s only a piece of the solution but it’s an important one. Get on-line or look in the yellow pages and locate where these places are near your house so you know before you slice open your hand cutting onions and need the help.

  9. Linda Gorman says:

    Will ED visit fees be charged and collected? In a lot of state Medicaid plans you might pay $5.00 for an ED visit, same as for a regular appointment. The ED is open after work and you don’t have to make an appointment. It is a much better deal.

    There is evidence that even moderate fees, on the order of $25 and waived if one is admitted to the hospital, do quite a bit to help curb excess utilization.

  10. Virginia says:

    Ditto Catherine! I took a nasty spill last month when I was at my mom’s house and had to limp inside and google “urgent care” to figure out where to go for an x-ray.

    In my industry, the biggest challenge to marketing is educating the consumer. It seems like the US is doing a poor job of teaching people where to seek care.

  11. Chris Ewin, MD says:

    Excellent article…
    My ER friends are overwhelmed as it is…
    The US trains about ~ 3,500 family physician residents/year.
    With the new influx of those getting insurance,they need to take care of 9,000 patients each…
    You make the case for patients paying PCP’s directly..

  12. DV says:

    No Surprise. I have worked at hospitals in several states. Some private some public. In general the “unfunded” ED visits constitute ~15% of the traffic. But the other 85% of ED visits are not all “emergent” –at least to a physician. That means that many who have some form of funded health plan (medicare, medicaid etc.)still feel the need to go to an ED.
    So giving that 15% crummy insurance that many physicians won’t take will do nothing! Indeed, when more people get transitioned to a government option the flood gates will fly open.

  13. Ibihwiori says:

    Depending on your emergency fund (EF) needs, split beeetwn the EF and the car loan. But the crux of the matter is not really how to divert your leftover savings, but how to increase those savings to erase your debt burden more quickly.Saving depends on1) Increasing Income (often less feasible).2) Decreasing Expenses (often more feasible).Most people focus on #1, and neglect #2. But most expenses can be decreased dramatically, or even eliminated. Share rent with lots of people, or live at home or in a low-cost area if possible, avoid owning cars in the near future (they suck a lot of money), eat out less, buy less (or better yet, nothing) or secondhand, don’t engage in expensive sports/hobbies, no travel/tech gadgets/brand names/movies, etc. Reduce all water, power, phone, mobile + cable bills to the minimum. Analyze your biggest expenses (usually rent/car/food/leisure/bills), and find ways to cut all the financial fat. Since you’ll have a lot of extra time on your hands, use it to invest in educating yourself and developing your professional talents/interests/skills so that you can achieve a higher future income potential. Go DIY don’t pay others to teach you.Live poor because actually, you ARE poor. By my personal definition, if you need a job in order to feed yourself, you’re poor. If you need to worry about what your boss thinks of you, you’re poor. If you’re in debt, you’re in the hole poor. Don’t be generous or ashamed you literally can’t afford to be. Be generous and proud after you’ve saved up some $ $ $ . Extreme situations call for extreme measures. If you compare yourself to other people with lots of debt, you’ll feel your situation isn’t so bad, but you should be comparing yourself to people with positive net worth. I only make 18K/year now, but I save about 10,12K more than 50% savings on income. I’ve been doing this for many years now, so it all adds up. So despite my low income, I had my basic 1K EF in my first month. I intentionally chose to live in a lower-cost city that didn’t require a car, and in the beginning I had to forego a lot of costly urban enjoyments (movies, dining, shopping, etc.). But the payoffs have been tremendous; I don’t worry about money or jobs. Plus, I only work part-time now. If you can find a way to save 1K a month, you’ll be well on your way. It’ll only take 20 months to pay off all your debts. If you have higher income and can save 1.5K, you only need 13 months to be completely debt-free.After you pay off your debts, you should continue your hardcore saving for a couple years, (1yr =12K, 2y=24K, 3y = 36K, depends on what your long-term financial goals are), after which you can invest your savings, and your money can start working for you, instead of you always working for money. Then you can ease off on or abandon the Spartan lifestyle. If you’re a guy, you might not want to though, because being a Spartan is actually pretty cool. It’s good mental physical training, because it helps to cut away all the consumer materialist crap in life. Makes you focus on what’s really important in life which is ironically, not the money, but yourself, your relationships, and your purpose in life. And coincidentally, all those 3 things suffer when you’re working the 9-to-5 grind and spending nearly all of your hard-earned money on whatever. Best wishes to you -