U.S. employers, insurers target pricey tests

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U.S. employers and health insurers, strangled by double-digit medical care cost hikes, are increasingly putting controls on the big-ticket procedures and medications, according to a survey released on Wednesday.

Expensive tests like CAT scans and MRIs, which are prone to overuse in the eyes of health care payers, are among the procedures being limited, according to the study of health-care leaders, employers and other players in 12 U.S. cities including Boston, Miami, Seattle, and Phoenix.

Spurred by “off the wall” over-use, the plans are zeroing in on services like diagnostic imaging, outpatient surgery, and physical therapy, the study by the nonprofit Center for Studying Health System Change said.

“Plans are increasing scrutiny of high-cost services, especially services those pose a high risk of inappropriate use,” said Paul Ginsburg, president of the group.

The findings are based on interviews with health plan executives, companies and policy makers conducted between 2002 and 2003 in Boston; Cleveland; Greenville, South Carolina; Miami; Northern New Jersey; Orange County, California; Phoenix; Seattle; and Syracuse, New York.

Mounting hospital, prescription drug and doctor costs drive health-care premiums, which rose 13.9 percent in 2003, according to the Kaiser Family Foundation.

Health plans and employers are also requiring more “prior authorization” on prescription drugs that may be abused such as Pfizer Inc.’s blockbuster erectile dysfunction drug Viagra and the painkiller OxyContin, the study found.

The pendulum appears to be swinging back toward the trends of the 1990s, when health maintenance organizations kept a tight rein on costs and consumer choices.

After the perceived bureaucracy of HMOs led to a consumer backlash, HMOs generally became more flexible, introducing more choices for consumers.

The recent tightening of controls by employers and insurers is not as severe, the study said, because plans are focusing on the most costly line items and not so broadly restricting care.

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