Claims study quantifies growing impact of opioid crisis

Intuitively, most industry observers know more people are receiving treatment for opioid addiction today than just a few years ago. This week, FAIR Health, a not-for-profit, independent data organization, released a new report that has quantified the magnitude of the trend.

And it’s staggering.

Commercial health insurers paid treatment centers, hospitals, labs and other medical providers $445.7 million to treat plan members’ opioid dependence and abuse in 2015. By comparison, 2011 payments totaled just $32.4 million, demonstrating a 1,375% spending increase over five years.

Overall, the concern in the healthcare industry at large is that the crisis is costly, and the growth trajectory is steeply rising.

“It’s not wrong that claims are increasing,” says Marvin Ventrell, executive director of the National Association of Addiction Treatment Providers. “They’re increasing because people have conditions to treat that were not at this proportion years ago.”

More ER visits

The report also examined the types of procedures associated with the rising number of insurance claims and their related costs, making the distinction between opioid abuse and opioid dependence diagnoses.

“One fascinating outcome was learning that emergency room services constitute the highest aggregate costs associated with those diagnosed with opioid abuse, whereas emergency room costs were supplanted by lab tests and office visits as the highest aggregated costs for those with an opioid dependence diagnosis,” Robin Gelburd, JD, FAIR Health president, tells Behavioral Healthcare.

Gelburd also says the data suggest that those diagnosed with opioid abuse are showing up in emergency settings with more acute needs, whereas those with a dependence diagnosis seem to be involved in some form of therapeutic program.

“Accordingly, such data would indicate that there are opportunities to develop appropriate triage and referral practices that would ensure individuals suffering from opioid abuse get appropriate care and treatment in order to avoid other acute, emergent episodes,” she says.  

Pay gaps

FAIR Health also drills down to demonstrate that the initial charges for treatment services submitted by providers through the usual claims process were much higher than what the insurers actually paid out. For example, providers submitted claims for $721.8 million in payments in 2015, while insurers paid out $445.7 million.

It’s conventional for insurers to “reprice” claims to reflect the maximum allowed amounts that the insurer will pay for health services, particularly for providers with out-of-network status. The process happens for medical surgical claims as well.

An analysis by Behavioral Healthcare reveals that the gap between the charges submitted by providers and the charges allowed by insurers varied each year with the largest gap occurring in 2011. That year, allowed charges equaled 56 cents on the dollar for the submitted charges. There are many variables that likely contributed to the gaps, but further study would be needed to identify the underlying forces.

Lab tests rising

Additionally, FAIR Health reports significant increases in lab testing utilization from 2011 to 2014. The data organization analyzed CPT codes and found four codes that saw greater than a 1,000% increase in claims between 2011 and 2014.

“A lot of this is connected to excessive drug screens.” Ventrell says. “It seems huge because it is huge. And I wouldn’t expect to see that kind of increase in any other aspect of healthcare.”

Ventrell points out that as pressure continues on out-of-network rates, unfortunately, some organizations are looking to make up the revenue in drug screens.

FAIR Health has been tracking the effect of the opioid crisis on the commercially insured population and in July released a separate report indicating that the number of health insurance claims for opioid abuse and dependence had increased by 3,000% from 2007 to 2014. Now it’s clear that the cost follows suit.