`It’s All About the Cost’ of Health Care St. Mary’s Ceo Talks About How to Keep Increasing Prices Down

By TOM RAITHEL, Courier & Press staff writer 464-7595 or raithel@evansville.net

When Tim Flesch was the chief financial officer of St. Mary’s Health Care System, he had an eye-opener. His own health insurance costs were rising so fast, “I felt I couldn’t afford me anymore,” Flesch said.

But in the last three years, St. Mary’s Health Care System has kept its health insurance costs flat by providing incentives to employees to take better care of themselves and by requiring employees to pick up more of their health-care costs.

The levelling of costs “was a substantial reversal of our experience prior to that,” and has occurred as health-care costs nationally have been growing faster than the economy and workers’ incomes, Flesch said.

Flesch, who today is the president and CEO of St. Mary’s Health Care Systems, spoke Thursday to the Evansville Human Resources Association about health-care costs.

“It’s all about cost,” Flesch told the group. “We need to control the cost of health care.”

But it isn’t just about health-care price, Flesch added. Cost is caused both by price and by how often health-care services are used, he said. In recent years, health-care services are being used more for a variety of reasons, including a rise in the number of treated diseases, increased obesity and continued smoking which lead to health problems and an explosion in the early detection of chronic diseases, Flesch said.

Things driving up prices include the increased cost of medical equipment and devices, higher pharmaceutical costs and increased worker compensation due to a shortage of health-care workers, Flesch said.

The nation’s lifestyle is contributing to the problem, Flesch said, and in Indiana and Vanderburgh County, the numbers of obese and smoking patients and those with high-blood pressure and a sedentary lifestyle are above national averages, he said.

Companies can control costs through health screenings and by emphasizing exercise and nutrition.

Employee cost sharing, managed-care discounts and accounts like Health Savings Accounts (HSAs) can help control prices, Flesch said.

Health-care providers also must improve quality. Poor quality, Flesch said, can account for 30 percent of health-care costs. Thousands of lives are lost each year due to medical errors and billions of dollars are lost to employers each year because of poor care, Flesch said.

“We need the employer to be a better consumer than they are,” Flesch said.

The problem with rising medical costs is not a new one, “but it is becoming a crisis. This is really the time to have discussions, to have debates,” Flesch said.