Economic Development, Health Care, and Higher Education

Region compares favorably in health care outlook

But a spike in outpatient care is cause for concern.

January 20, 2017
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The health care industry in Grand Rapids received some encouraging news with the release of the eighth annual Health Check report.

Grand Valley State University professors Kevin Callison and Leslie Muller presented the report, which provides insights into health care trends in the region, at the 2017 West Michigan Healthcare Economic Forecast on Jan. 13. Following the Health Check presentation, a panel featuring Mercy Health Physician Partners CEO David Blair, Spectrum Health President Tina Freese-Decker, Michigan Department of Health and Human Services Director Nick Lyon and Meijer Total Rewards Vice President Jim McDonald also spoke.

What Callison and Muller’s research found is Grand Rapids compares favorably to other metropolitan statistical areas of similar demographics — which included Louisville, Kentucky, Buffalo, New York, and Cleveland, among others.

On average, Grand Rapids ranked below the national average in 2014 for number of inpatient visits per 1,000 people, which Callison said bodes well for the region, given the high cost of inpatient care.

“The fact that we’re using the hospital less often than most of these (comparable regions) may mean that our population is healthier than these other regions, and the fact that we’re below the national average has implications for expenditures,” Callison said. “This may be one of the reasons we’re a relatively low cost region when it comes to health care.”

However, Grand Rapids was shown to heavily rely on outpatient care for treatment, ranking well above the 2014 national average and more than doubling the number of outpatient visits in 2003. Callison said there isn’t a clear reason for this increase, but noted it is a trend to watch as more data comes in over the next couple of years.

Callison also noted Medicare expenditures trended downward from 2010-14 — Grand Rapids specifically was below the national average and toward the middle of the pack when compared to its seven comparable regions.

But for those under 65 years old, Medicare costs are rising, and the biggest change in health care costs, Callison said, has been in treating coronary artery disease (CAD). In 2015, the annual cost to treat CAD in West Michigan was nearly $26,000, about 22 percent more expensive than what it would cost to treat in Detroit.

Muller’s portion of the presentation focused on a survey of West Michigan residents about their insurance coverage. What the survey revealed is the rate of uninsured residents dropped four points to 5 percent, while just 15 percent of those who were uninsured at the time of last year’s report remained without coverage. The most prominent way uninsured residents received coverage was through employment (about 40 percent), with Medicaid (21 percent) and the ACA Marketplace (8 percent) the next highest avenues for coverage.

Muller said there are two primary reasons for the increase in insured residents.

“One is that those who were uninsured over the last year simply attained employment, and those firms had a plan,” she said. “The other reason that this could occur is they had been employed; however, their employer then offered insurance and they took that.”

Following the report overview, each member of the panel gave brief presentations on trends they have noticed in the industry. Blair advocated for the benefits of a population health management model, noting the model would better support communities and patients.

Freese-Decker said the future of health care will continue to be driven by consumers, either through legislation or interacting with businesses, “and it’s our job to listen to them.” She went on to share some of Spectrum’s efforts to meet those consumer demands, including offering telemedicine visits, innovating organ containment systems to allow a heart to continue beating during transportation and increasing transparency.

Lyon spoke on behavioral risk factors in the state, noting one-third of Michigan’s population still is overweight, despite slight improvements in the national rankings.

“It’s a continuing trend that, quite frankly, affects and crowds out innovation in the health care sector and potentially other parts of the economy as well because of the costs of the chronic diseases associated with our fitness levels and our overweight and obesity levels,” Lyon said. “The expectation is that we’re going to treat people and it’s going to be costly, and we know it’ll be less costly if we could maintain a healthier lifestyle through our population as a whole.”

McDonald said Meijer’s third party wellness vendor, Welltalk, is working on tackling the problem of obesity through a program that recognizes high risk and obese members and works to coach them through weight loss and health challenges.

“But I will tell you, it is not enough, we need to do more,” McDonald said.

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