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Healthcare Market Research Predicts Increased ER Visits with ACA

Doctor wheeling a patient into an ERLast week, the journal Science published the results of a Medicaid study called the Oregon Health Insurance Experiment. It would not be an overstatement to say the findings of this study seem to shake one of the basic premises of Obamacare — that providing health insurance coverage to the uninsured would reduce unnecessary emergency room visits and reduce costs to the system.

The hypothesis was that the uninsured delay care until they are so sick that they end up in the emergency room. When these patients do not pay their emergency room bills, the insured bear increased insurance premium costs, because hospitals have to raise their prices to cover the lost money. 

By providing health insurance coverage through Medicaid, previously uninsured patients would theoretically pursue preventative care and schedule appointments with Primary Care Physicians like the rest of the insured population. This would reduce overall system costs and relieve emergency rooms of patient traffic that should otherwise be handled in the primary care setting.

The Oregon study actually found that people who obtained Medicaid benefits in a 2008 lottery used emergency rooms at a +40% higher rate than did people who remained uninsured. 

This increase consisted entirely of people using the emergency room for non-emergency medical issues, or for things that could have been prevented through primary care.

Thus, the study would suggest that expanding Medicaid under the Affordable Care Act (ACA) may lead to substantially higher emergency room use. In fact, the law could increase overall emergency room spending approximately $1 billion if all 50 states were to expand Medicaid accordingly.

Why the Increase in Emergency Room Visits?

The premise described above sounds rational… if healthcare were a rational subject for consumers.

Unfortunately, consumers do not always follow textbook logic when it comes to their health and wellness. Health is an emotional subject, and a consumer’s motivations drive behaviors that may not be as predictable as the law’s authors would like.

Or are they predictable?

My colleagues and I have discussed this very subject over the past few years since the ACA was enacted. We made a gentleman’s bet that emergency room visits would actually increase under Obamacare, not decrease — though I have to admit we were surprised by how significant the rate of ER use actually climbed in the Oregon study.

Why did we predict the increase in ER use? It wasn’t magic — it was in the data. Specifically, the c2b Consumer Diagnostic, a market research study on the U.S. healthcare consumer, indicated that the leading segment among the uninsured is what we call the “Willful Endurers.” 

While they represent 27% of the general population, this segment represents 39% of the uninsured population!

Psychographic Segmentation Distribution Across Populations

Psychographics:  The Willful Endurer Segment

A psychographic segmentation model, which is 91.1% predictive, was derived from the c2b Consumer Diagnostic study to understand consumers’ approaches the health and wellness. Psychographics are comprised of the emotions, values, personality and lifestyle of consumers, and these variables drive motivations on a subconscious level. 

Willful Endurers are generally disengaged from the healthcare system and do not prioritize health and wellness. They are the least likely segment to engage in preventative care or to make a doctor appointment. They live in the “here and now” and do not think about tomorrow. 

They are hardwired to be highly reactive; if they can’t take care of an issue themselves, they will take the path of least resistance. Scheduling doctor appointments weeks (or months) in advance is anathema to the Willful Endurer, as is practicing prevention for something that may (or may not) happen down the road.

When uninsured Willful Endurers understand that Medicaid will cover their care, it alleviates any concerns or preconceptions about whether an emergency room will turn them away. This would accentuate the notion that the emergency room is the place to go for care since it doesn’t require an appointment.

What Can Be Done to Prevent Unnecessary Emergency Room Use?

Aside from policy changes or restrictions on ER use, there are ways to get through to Willful Endurers and influence behavior change.  Each of the five c2b Psychographic Segments has its own set of motivations and communication/education preferences. 

There are ways to form propositions and messaging that appeal specifically to Willful Endurers, and pilot projects involving c2b solutions has shown provocative, positive health behavior changes among this challenging segment.

I will share the results of these pilots in future articles, so stay tuned. In the meantime, if you would like to learn more about the c2b Consumer Diagnostic or the c2b Psychographic Segmentation model, please visit our website.

Psychographic Segmentation and its Practical Application in Patient Engagement and Behavior Change

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