Physician visits by privately insured patients decline 17%

Physician office visits by privately insured patients younger than 65 have fallen 17% in two years, according to a Kaiser Family Foundation analysis released Nov. 15.

The research is the latest to suggest that the decline in how often patients see their doctors, fill prescriptions and stay in the hospital is due to factors beyond the recession and may last for a while.

The quarterly number of office visits by privately insured patients had reached 160 million by 2005 then was at a plateau until the recession hit, according to an analysis prepared for Kaiser at Stanford University using data collected by IMS Health, a market data firm in Danbury, Conn.

The most recent figures dipped to 129 million visits in the second quarter of 2011, a decline of 17% from the second quarter of 2009.

Kaiser's analysis cross-referenced those visit figures with its research into health insurance coverage and found that the number of privately insured patients dropped by only about 2% between 2009 and 2010. Kaiser said the visit growth earlier in the decade was a result of privately insured patients going to the doctor more often, not a rise in the number of patients with insurance.

"Even people who are insured are going to the doctor less," Kaiser researchers Gary Claxton and Larry Leavitt wrote. "Likely, consumers are reacting to the severe economic downturn and significant job loss which has defined the economy over the last several years by cutting back on health spending. Higher deductibles, co-pays and co-insurance increase the cost of care, and their impact may be magnified in these tough economic times."

The declining volumes may be longer-lasting than the economic downturn, they wrote. "As the economy recovers, service use will probably begin to increase, but when that will happen and by how much it will increase will be difficult to predict."

Similar conclusions turned up in comments by analysts at the Fall Forum hosted by health insurance trade group America's Health Insurance Plans in Chicago on Nov. 15. The conference was held after various reports, including those put together by government and investment analysts, recorded overall declines in physician visits.

Paul Mango, Pittsburgh-based director of the payer and provider practice at consulting firm McKinsey & Co., told an audience of health plan executives that only 25% of the recent decline in utilization is "cyclical." The other 75% is "structural," due to benefit design, higher deductibles, co-pays and co-insurance that the Kaiser researchers cited.

"Will it come back?" Mango asked. "Yes, but nowhere near what it was."

A few minutes later on the stage, Credit Suisse investment analyst Charles Boorady also said some of the utilization decline will be permanent. His firm disagrees with the Centers for Medicare & Medicaid actuary's office in projecting a rebound in health care spending.

"We think there's a new normal," he said.

The same researchers and analysts do not say physicians are likely to be idle in the coming years. Even if overall per-capita utilization slows among people younger than 65, the population of those older than 65 is growing. Plus, an anticipated 32 million people will be eligible for health insurance coverage in 2014.

The newly insured are expected to make up for lost time -- at least initially -- by seeing a doctor more often than when they were not covered.

Michael Dudley, president of Norfolk, Va.-based Sentara Health Plans, told the audience at the AHIP meeting that hospitals and physicians tell him they are concerned about accountable care organizations and other delivery system reforms leaving unused capacity in their offices and hospitals.

That fear is unfounded, he said. "There is a rapidly aging population ready to fill those beds as soon as they are empty."