The Labyrinth of Care

excerpted from the book

Critical Condition

how health care in America became big business - and bad medicine

by Donald L. Bartlett and James B. Steele

Broadway Books, 2006, paper


Nearly one of every three dollars now spent on health care goes for administration, from processing the voluminous paperwork of billing to enforcing the length-of-stay guidelines that brought grief to Musette Batas. A generation after introducing business practices to health care, the United States spends a higher percentage of its health care dollars to administer the system than any other country. A study published in the New England Journal of Medicine in 2003 comparing administrative costs in the United States and Canada concluded that U.S. costs are three times higher: $1,059 per capita in the United States in 1999; $307 per capita in Canada.

Long-distance Diagnosis

A generation ago, your personal health care decisions-a medical appointment, a prescription, a test, a recommendation for a specialist-flowed through your doctor's office. Your physician decided whether you would have a procedure, whether you would be admitted to a hospital, and how long you would stay. To cut costs, the insurers took much of that power away from doctors and gave it to the health care call center. Here, in their lexicon, was a way to "manage" care, which really meant to restrict and deny care. The length-of-stay guidelines and coding schemes were but tools to achieve that end. The call center became the command post to carry it all out.

Since then, hundreds of call centers have popped up across the country, employing thousands of workers. A few are located in or near big cities, but most are in medium-sized communities or small towns. Often they are in areas where jobs are hard to come by, thereby enabling owners to hold down wages and still attract grateful workers. Bismarck, North Dakota, hosts some of the health care industry's largest centers. In towns like Visalia in central California, the call center is the largest employer.

For many Americans, the centers are perhaps the most infuriating symbol of U.S. health care. The chief function of the faceless people who answer the phones seems to be to see how long callers can be kept on hold or how many times they can be compelled to call again and again before securing a satisfactory answer to a question. Housed in warehouse-like buildings, the centers sit anonymously alongside interstate highways or sequestered in featureless office parks. The interiors of these places don't look like they have anything to do with medicine, and the workforce could just as easily be filling orders for L.L.Bean.

Imagine an empty Wal-Mart, lined with row after row of cubicles, each separated by a low partition, stretching in every direction as far as you can see. Inside each pod is a compact workspace with a computer terminal and an operator, usually a woman, wearing a telephone headset. Rising above this vast grid of squares is the constant sound of phones ringing, people talking, and computer keys clicking. In some centers, the sound goes on twenty-four hours a day. As calls stream in, they are randomly routed to operators. If a caller complains of a medical problem, the operator asks a series of questions: Where is the pain or discomfort? 'When did it start? How intense is it? Have you had it before? 'Who is your primary-care physician? The questions may give callers the impression that they are speaking with someone who is well versed in medicine. But most operators are simply reading questions that appear on their computer screens and keying in the answers.

The operators rely on software programs called scripts that offer up standardized queries about various ailments and injuries, allowing people with no medical training to diagnose conditions that were once solely the responsibility of medical professionals. In theory, a caller who has a serious problem will be turned over to a nurse or physician. But that decision rests largely with the operator, often a low-paid worker who is new to the job.

For many call-center employees, their only training is mechanical and rudimentary-how to answer the phone, how to use the computer, how to access the scripts, how to input the caller's answers, and how to make a referral. A good telephone manner is a plus, but it's not essential. What the industry requires most is bodies to answer an evergrowing tidal wave of calls. Although these workers have become crucial cogs in the health care bureaucracy, they rank at the bottom of the industry's hierarchy. When insurers cut their budgets, they are among the first to go. People hired one month are often laid off a few months later, and sometimes long-standing employees are terminated only to see their jobs filled by new hires at lower pay.

The call centers are essentially factories, today's equivalent of yesterday's assembly lines. Tethered to telephones all day and fielding an endless stream of inquiries, appeals for help, billing questions, and requests for referrals, prescription refills, and doctors' appointments-all the while under pressure to move on quickly to a waiting callworkers are much like their predecessors in textile mills at the dawn of industrialization. The surroundings may be cleaner, better lighted, and less noisy, but they are every bit as regimented and stressful.

The work is intense. On any given day, an operator handles dozens of calls from worried and angry patients and physicians asking why a referral didn't come through, or why a patient had to pay such a large percentage of a medical bill, or why a physician wasn't reimbursed in full for a procedure. Doctors become livid when they talk about the amount of time they waste on the phone with clerks who, after consulting their computer screens, refuse to grant a referral or authorize a test because they deem the physician's request to be medically unnecessary.

Call-center workers are the health plans' gatekeepers who restrict and ration care by saying "no" to patients and physicians alike. Technically, they are customer-service representatives, but usually their work is just the opposite-to discourage care, tests, or procedures, and reduce or delay reimbursements.

Operators are under enormous pressure to minimize the time they spend talking on the phone or processing claims. Those who take longer than average are reprimanded and threatened with dismissal. Says an employee at one California operation: "They will say, 'Now what is the problem here? You know how long you are supposed to be on the phone." In this job, she says, the fear of spending too much time with a patient is "always hanging over your head." The briefer the calls, of course, the more calls that can be fielded, which means fewer employees and more for the bottom line. One health care consultant says, "If you measure this by the number of calls they have to take, these are sweatshops."

In northern California, Kaiser Permanente dangled similar incentive bonuses before clerks to keep calls brief. In a plan implemented at three large centers in Sacramento, San Jose, and Vallejo in 2000, Kaiser promised, according to the Los Angeles Times, to reward clerks with upward of a 10 percent salary bonus if they accomplished three of four objectives:

o Handle regular calls in less than three minutes and forty-five seconds.

o Schedule or request appointments for patients in no more than 15 percent to 35 percent of cases.

o Transfer fewer than 50 percent of calls to nurses for additional help.

o Spend an average of 75 percent or more of the workday answering calls.

In a year's time, an aggressive clerk could earn a bonus of $2,500 by keeping talk to a minimum and referring fewer callers to physicians and nurses. Kaiser maintained that the program was to promote good service, but it sparked outrage among Kaiser's call-center nurses, who believed that it encouraged untrained clerks to make medical decisions that might harm patients. After two years, Kaiser abandoned the experiment, saying that it "wasn't working." But Kaiser's long-range strategy, like that of most HMOs and insurers, is still to shift more work to lower-paid clerks with no specialized medical knowledge.

Online and Offshore

Today, when you phone your health care company, you have no idea who's answering the call or where that person is located. Not so many years ago, companies tried to place centers in the same region as their enrollees. But that effort gave way to pressures to consolidate into ever-larger facilities, to cut costs, and to save money. If you place a call to your health provider from your home in Ohio, you might just as easily wind up talking to someone in New Jersey or North Dakota or California; the whole process is so anonymous, so remote. Courtesy of fiber-optic cables and satellites, it's about to get even more remote. Before long, your call will connect you to someone so polite, so well spoken, and so American-sounding that you won't know that you're speaking to a person halfway around the globe-in India.

This new stage in the evolving world of American health care got under way quietly in late 2000 when Aetna, one of the nation's largest health insurers, embarked on a little-known pilot project in the heart of India's Silicon Valley. Starting with twenty-three employees, Aetna established a claims-processing operation in the southern Indian city of Bangalore to transfer information from personal health claims filed by Aetna subscribers in the United States into the company's database. Previously, such claims had been processed at an Aetna call center in Allentown, Pennsylvania.

Earlier that year, Aetna instructed its Allentown workers to bundle up paper claims and ship them to a company in Texas, where they were electronically scanned into portable document files (PDF). The images were e-mailed to two Aetna offshore sites, one in Ireland and a newer one in Bangalore. Workers at each then input the data from the imaged claims.

Over the next two years, Aetna, lured by wage rates that averaged 80 percent less than in the States, shifted more of its claims processing to India. In Allentown, where the offshore processing was reviewed, claims agents noticed errors in the data coming back. "The only time you could have any communication was by e-mail, and it was difficult to explain to them what they were doing wrong," said one former employee who asked not to be identified. "For the consumer it is a shame. The average person has no idea this is going on."

Aetna was so pleased with its Bangalore venture that it added more workers there and opened another claims center in New Delhi. Aetna employees from Allentown were dispatched to train their Indian counterparts. By the end of 2002, Aetna had more than five hundred agents in India processing American health claims. As the hiring continued in India, the layoffs began in Allentown.

Although Aetna kept a low profile about its Indian operation, word spread rapidly among health care companies. For years there had been talk about tapping the low-wage, English-speaking Indian market to take over some of the administrative expenses incurred by call centers in the States, but this was the first sign that it might be feasible on a wide scale. "Aetna was absolutely the groundbreaker on this," said one Indian consultant, "the big kahuna."

Others soon followed, and still others planned to do the same. United Healthcare, the nation's second-largest insurer, launched plans for a 300-person call center and claims operation in Mumbai (Bombay) and let it be known it hoped to have as many as 4,000 agents in India in coming years. Consultants who track the industry say that more insurers and health plans, including Wellpoint, Coventry, Horizon Blue Cross & Blue Shield, Humana, and Blue Cross & Blue Shield of Michigan, are actively trying to establish Indian call centers.

Industry observers believe that it's only a matter of time before a substantial number of American patients who phone their health care plans will reach someone in India. And most of them won't even know it's happened. The sophistication and technical expertise of the Indian call-center industry is such that connecting an American health care consumer to an Indian worker in a call center halfway around the globe is virtually seamless. Technology is only part of the reason. Young, college-educated Indian call-center employees undergo training to Americanize their voices and become familiar with contemporary American culture.

Schools have sprouted across the subcontinent to train workers to sound like Americans when they answer phone calls from the United States. At Call Center College in Bangalore, students receive four weeks of intensive instruction in which they are "immersed in the American sound," says Julian P. Gurupatham, vice president of training. The goal, he says, is to produce an accent "any American can understand." Equally important is cultural immersion. Trainees watch hours of American television shows and movies to soak up pop culture. Friends, Ally McBeal, The Simpsons, Whose Line Is It Anyway?, and Sabrina The Teenage Witch are popular TV serials. Among movies, The Truman Show, Volcano, and Jurassic Park are big hits. After this training, says Prakash Gurbaxani, former CEO of an Indian high-tech company, "it's very rare that anyone will figure out that their 1-800 call is actually being answered in India."

Inside the call centers, to remind workers of their American state of mind, walls are plastered with American flags and slogans, and each clerk's phone flashes a message indicating the city and state of the incoming call. At the most sophisticated centers, clerks even get up-to-the-minute information on weather conditions and the latest sports scores in the caller's hometown. To make American callers believe they are speaking to someone in the States, workers in many Indian centers adopt American names and, when asked, give their location as a city or state in the United States. "At work I am Candy," one Mumbai call-center employee told an Indian online journal. "Outside I am Rehka. That's how I see it. There's nothing more to it. It is like with actors. They play a part every time." But the deception troubles some: "Can a company genuinely argue that they are offering excellent . . . 'customer service' if the first thing they tell their agents to do is lie about their name and then their geographic location?" asked a worker in an Internet chat room.

Less than a decade ago, India's international call-center industry got its start by setting up offshore operations for U.S. credit-card companies.

It has since expanded into computer services, online sales, software technical support, banking, tax returns, travel services, and more. Everyone agrees that the American health care market is the next big frontier, the one offering the greatest potential of all. The vast number of administrative jobs and constant pressure on insurers to maximize profits are expected to produce a steady migration of call-center and other health-industry jobs to India. Ravi Shah, a Wisconsin-based consultant who is working to facilitate the transfer, thinks it will be huge: "Given the right approach, successful execution, offshore [business processing] is likely to become an integral part of [the health care] industry... What we have seen so far is not even the tip of the iceberg, with the best yet to come."

Shah and other consultants see a process unfolding: Most of the health care giants will start with claims processing, as Aetna did. Then they will move on to more direct call-center services such as telephone inquiries. Eventually, offshore call centers will take on most of the tasks now performed in U.S.-based centers, including claims adjudication, membership enrollment, and policy changes, in which India-based agents will converse with American health care consumers. Ultimately, the centers could provide medical advice as well. "There are tons of doctors and nurses in India today who don't have jobs," observes Julian Gurupatham of Bangalore's Call Center College.

American health insurers are keeping quiet about the move. Says one consultant: "Most of these companies don't want to make a lot of this information public because it creates a lot of problems for them, like a backlash from consumers, who wouldn't be thrilled to know that somebody in India is reading their medical records."

And for good reason. Any call-center worker in the United States who made public a patient's medical records could be charged with violating privacy laws and fined for divulging confidential personal medical information. But what recourse is there if a clerk in India, f Pakistan, or elsewhere in Asia decides to do just that?

Despite potential hazards to patients, the offshore health care bureaucracy will continue to grow, for the same reason that consumers buy dresses, shirts, trousers, shoes, and other clothing made anywhere from the northern Mariana Islands to China: cheap labor. But don't look for the savings to show up in your health insurance premiums. Instead, the money will flow to the insurers' bottom line, and your premiums, co-pays, and deductibles will continue to spiral upward.

As for the insurers, it's going to get even better, thanks to the information technology revolution. The next health care work expected to move offshore, notably, again, to India: the reading of mammograms, xrays, and MRIs.

Critical Condition

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