Health insurer Cigna Corporation's first quarter net income was $208 million, compared to $58 million for the same period last year. Three years ago United Healthcare Corporation's CEO was the highest paid CEO in Minnesota, not including the $45 million dollars in options for the year. Other senior executives of United made multi-million dollar salaries. Look at the earning reports in the health insurance industry and you will see some of the same scenarios: million- dollar salaries and million-dollar stock options for insurance executives. 

 

So yes, healthcare costs are high, but it's not the medical portion as much as the salaries of insurance executives and denials of payments to customers. If insurance companies are willing to look at real data and listen to patients and physicians, costs of care can be better controlled.

 

I started working with a group of endocrinologists to address the diabetes issue and examine the resources. The average hospital cost of treating a diabetic patient is between $12,000 and $20,000 depending on the other associated co-morbidities such as hypertension, heart disease, blindness, stroke and lower foot and leg amputation. The cost of renal dialysis is approximately $240,000. Memphis has one of the highest rates of dialysis use. The number of for-profit dialysis centers is multiplying substantially both in Memphis and other parts of the country.

 

Along with some prominent endocrinologists in our city we approached a number of insurance companies with real data and examples of how working together we could have a substantial impact on the cost and quality of life in our community. I am talking about millions of dollars. We recommended using data and examples of preventive care and reimbursing physicians and other providers for the time and care needed to save money and improve quality of life. These are simple things such as paying more on office visits, allowing patient educators to be paid on the same day a patient is seen, paying for faxed or emailed glucose levels patients could send into the physician's office. This would allow glucose levels to be sent to the physician's office once every two to three days instead of the patients having to come back to the physician's office every two months. It is also a substantial savings to employees for time off work. Yet, when we give data to payers that show how to reduce costs, they still elect to pay for the higher cost of care treatments.

 

We could go on and on with examples like this with other specialties that can save employees money, create additional access for other patients, and improve community health. You don't have to be a rocket scientist to see the cost savings and quality of life that we are talking about. But first things first, insurance CEOs have to learn to live within their means like the rest of us do. It's time to take a pay cut.