Getting Ahead of the Trend Using Total Health Management To Chart Your Plan s Future

Transcription

1 Getting Ahead of the Trend Using Total Health Management To Chart Your Plan s Future County of Sonoma Joint Labor Management Benefit Committee August 21, 2008 Presented by: Thomas M. Morrison, Jr., Robert Mitchell Copyright 2008 by The Segal Group, Inc., parent of The Segal Company. All rights reserved.

2 Discussion Topics The Concept of Total Health Management Process for Implementing Total Health Management Case Study Importance of Communications in the Total Health Management Environment 1

3 The Current Healthcare Model Is Flawed Our healthcare system is designed to treat sick people rather than keep people healthy TPAs and insurers focus on the price of care more than on utilization, employee health habits, and treatment outcomes Public employers have not invested in promoting good health and reducing demand for services Public employers have not acted to promote health care quality, medical outcomes, and patient management Healthcare consumers receive little support or guidance in how to use medical services efficiently Past innovations become embedded concepts (e.g., managed care) The old fix of more managed care are no longer enough. 2

4 Understanding Our Past Can Help Us Plan the Future 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% 12% 4% 18% 14% 8.50% 5% 4.50% 3.7% 5.30% 8.20% 10.90%12.90%13.90% 11.20% 3.80% 0.8% 2.20% 3% 3.70% 1.90% 2.10% 2.30% 9.20% 7.70% 3.50% 3.50% Increase in Health Insurance Premiums Health Insurance Premiums Overall Inflation Source: Kaiser Family Foundation Annual Survey 3

5 Poor Health Habits Cost Money INCREASE IN COST TO HEALTH PLANS FROM PREVENTABLE CONDITIONS 1 In Billions $30 $25 $20 $15 $10 $5 $ Pulmonary Conditions Arthritis Cancer High Cholesterol Hypertension Diabetes Heart Disease Between 1987 and 2002 Health care cost rose 60% Costs associated with preventable conditions doubled Prevalence of preventable conditions rose by 78% Obesity rates have increased dramatically Seven conditions accounted for one-third of total cost increases between 1987 and Source: Health Affairs, Costs are adjusted to reflect general inflation. Number of individuals covered under employer-sponsored health plans rose by only 6.7%. 4

6 Gaps in Quality of Care Trigger Additional Costs Lack of patient safety is a cost driver Approximately 98,000 people die each year in hospitals due to medical errors that are preventable* Pharmacy errors injure over 1,500,000 people each year* Rarely does the medical system force providers to meet an established standard of care for a patient The Result? Patients have little financial incentive to care about efficiency or appropriate utilization of services * Institute of Medicine, Crossing the Quality Chasm 5

7 An Expert Study on Efficiency Based Upon Data Evaluating the Efficiency of California Providers Caring for Patients with Chronic Illnesses John E Wennberg Elliott S. Fisher Laurence Baker Sandra M. Sharp Kristen K. Bronner 6

8 Differentiation of Charges for Inpatient Care Four California metro locations benchmarked No differences in demographics or quality of health Medicare patients were used because of the amount of data that was available All case studies involved patients in the last two years of life identical outcome the patients all died 7

9 Outcomes Vast differences in the severity of treatment (ICU days), cost of care and length of stay Inverse relationship between severity of care and perceived quality of care by patient and relatives Less is more, more is less. Metro areas: Sacramento (benchmark) San Diego San Francisco Los Angeles 8

10 Cost of Medicare Spending in Last 2 Years Metro Area LA San Francisco San Diego Sacramento Cost per decedent $58,480 $45,672 $41,319 $34,659 Resources: ICU days Total days % seeing 10 or more Physicians 43% 34% 36% 26% Quality % < Average 57% 9% - 13% 9

11 RAND Study: Gaps in Care Drive Higher Costs Condition Percentage of Recommended Care Received Low back pain 68.5 Coronary artery disease 68.0 Hypertension 64.7 Depression 57.7 Orthopedic conditions 57.2 Colorectal cancer 53.9 Asthma 53.5 Benign prostatic hyperplasia 53.0 Hyperlipidemia 48.6 Diabetes mellitus 45.4 Headaches 45.2 Urinary tract infection 40.7 Hip fracture 22.8 Alcohol dependence 10.5 Source: Elizabeth McGlynn, et al, The Quality of Health Care Delivered to Adults in the United States, NEJM, Vol. 348: June 26, 2003 (No. 26). 10

12 Many Initiatives But Little Coordinated Strategy 11

13 It s Time for A New Paradigm The definition of insanity is doing the same thing over and over and expecting a different result Einstein The old paradigm of health care cost containment has lost its effectiveness Network management and contracting for discounts are no longer effective cost management tools The aging population minimizes the efficiency of all managed care We need a new paradigm, based on: Promotion of healthy living to eliminate claims from ever happening Proactive County engagement with the employee to promote better health and manage disease states Improving quality of care, not reducing cost of care 12

14 A New Direction: Total Health Management THM applies a coordinated strategy to address some real causes of medical cost escalation, such as: Outdated care processes in the healthcare system Inefficient providers Poor care management Poor quality care A lack of focus on preventive care and health promotion Poor employee health habits 13

15 A New Direction: Total Health Management THM employs a variety of tools to focus management resources on the utilization of medical services through: Sophisticated data analytics that identify health risk sources and treatment gaps Support and outreach to assist plan employees in accessing timely and appropriate high-quality care Collaboration with primary care physicians to identify gaps in medical treatment and development of treatment plans to close the gaps in care Promotion of good health habits among plan employees 14

16 Moving to Total Health Management Now Future PPO Network Prescription Drug Management U/R and Case Management Disease Management Condition Management Using Data to Focus Design Guiding Care to Quality Patient Coaching Patient Coaching Maternity Management Wellness/Health Promotion Care Coordination Nurse Line 15

17 In a THM World Players Assume New Roles County Employee Medical Provider Insurer/HMO CURRENT ROLE Financial and Fiduciary oversight Passive, Sheltered, Entitled Dominant and Directed Overseer and Gatekeeper NEW ROLE Facilitator, Advocate, Leader Active, Informed and Motivated Consumer Empowered, Accountable Caregiver Case Manager and Advocate Quality Metrics Network Level Consumer Level Administration Disconnected Paper Integrated Electronic It is all about changing behavior. Evolution not revolution. 16

18 Establishing a Total Health Management Strategy Data Analytics Care Management Condition Management Focused Treatment Plans Guide to Proper Care Promote Wellness Identify opportunities to develop a new healthcare cost management strategy to manage medical utilization Achieve better employee medical treatment outcomes Identify gaps in medical treatment and guide employees to proper care through focused treatment plans Identify high quality, high performing care providers and guide employees to use these providers Improve employee health habits through wellness, health promotion and employee education 17

19 Implementing Total Health Management Analytics Planning Design Selection Management 6 Outreach Collect claims data to develop a predictive model for health risks Perform cost savings opportunity/health risks analysis 18

20 Gathering Data Analytics Having Detailed Utilization Data in a Searchable Format Ensures greater transparency Vendors unable to conceal bad news or hide spreads Plans can independently validate discounts, fees, outcomes Enables informed decisions Understand likely employee disruption before changes are made Discover the disease burdens and disease severity of population Identify specific physicians as enablers for improvement Forecast future costs/trends more accurately Improves plan efficiency Some vendors are slow to provide access to data Gain control over your plan s unique needs 19

21 Defining Population Health Risk Factors Analytics CRG Status Description of Clinical Group 1 Healthy Non-user vs. user distinctions 2 One or More Significant Acute Diseases Severity Index Chest pain 0 3 One Minor Chronic Disease Hyperlipidemia or Migraine 4 Multiple Minor Chronic Diseases Hyperlipidemia and Migraine 5 One Major Chronic Disease Diabetes or Asthma 6 6 Two Significant Chronic Diseases 7 Three or More Chronic Diseases Asthma and Hypertension CHF, Diabetes and COPD 8 Complicated Malignancies Lung Cancer or Brain Malignancy 9 Catastrophic Conditions AIDS, Dialysis or Ventilator Dependent

22 Implementing Total Health Management 6 Management Analytics Planning Design Selection Outreach Establish collective vision among decision makers about future state of the plan Define guiding principles and key objectives Define how success will be measured 21

23 Implementing Total Health Management Analytics 6 Management Planning Design Selection Outreach Develop key elements of the Total Health Management Design Assess the capabilities of the County, Blue Cross, PacifiCare, Kaiser, Caremark, utilization management and other vendors to deliver the needed services 22

24 Implementing Total Health Management Analytics Planning Design Selection Management Outreach Select service vendors to perform key roles Develop performance standards and key metrics 6 23

25 Implementing Total Health Management Management Analytics Planning Design Selection Outreach Finalize financial management reporting requirements and set schedule for monitoring results Perform final operational integration testing of all service vendors Facilitate and manage vendor collaboration 6 24

26 Implementing Total Health Management 6 6 Analytics Planning Design Selection Management Outreach Develop communications strategy to educate employees/retirees Roll out stakeholder education and communications campaign for each design element Initiate outreach to employees/retirees with high health risks 25

27 Case Study CASE STUDY A Plan of 3,500 members and dependents wanted to determine the cost drivers of health care: Population is concentrated geographically within jurisdiction, with some employees residing in neighboring jurisdictions 85% of employees live in two major urban centers Costs have been rising 10% to12% annually for the last 4 years Self-funded using a TPA Lease a national PPO network 26

28 Key Finding #1: Cost Drivers CASE STUDY Status # of CEEs Percent of Total Total Dollars Paid Percent of Paid Projected PMPY Healthy 1, % $386, % $338 One or More Significant Acute Diseases % $215, % $3,414 One Minor Chronic Disease % $516, % $1,550 Multiple Minor Chronic Diseases One Significant Chronic Disease Two Significant Chronic Diseases Three or more Significant Chronic Diseases Complicated Malignancies % $468, % $3, % $1,715, % $3, % $2,772, % $8, % $245, % $12, % $1,965, % $163,775 Catastrophic Condition % $331, % $55,280 Total 2, % $8,617, % $3,487 CEE = Continuously Enrolled Employee 27

29 Key Finding #2: Top 10 Diseases Driving Cost CASE STUDY Disease Patients Percent of Total Total Cost Percent of Cost PMPY Diabetes % $1,011, % $ 4,838 Hypertension , ,286 CAD , ,267 CHF , ,349 Asthma , ,708 ESRD , ,361 COPD , ,931 Depression , ,562 Breast Cancer , ,457 CVA , ,172 28

30 Key Finding #3: Diabetics Not Getting Needed Care CASE STUDY Diabetes Testing and Exams Employees Eligible Employees NOT Compliant Percent NOT Compliant Eye Exam % Foot Exam % Hemoglobin % Nephropathy Monitoring % Lipid Test % 29

31 Key Finding #4: Ranking Physicians by Practice Management Index Is Important to Diabetic Treatment CASE STUDY Name Specialty Average BOI Average CMI Utilization Score Complication Score Gaps in Care Score Total Score Membership Percent PMI Driver Total Paid PATRICK V MIZRAHI CAROL A MINNEROP BARI F CEKA BEN PASCARIO JOSE KATZ CANDIDA CATUCCI OSCAR L CHAMUDES Internal Medicine % $671,457 Internal Medicine % $931,830 Internal Medicine % $519,804 Obstetrics & Gynecology % $768,137 Internal Medicine % $1,233,453 Internal Medicine % $617,215 Pediatrics % $145,120 BOI: Burden of Illness CMI: Care Management Index PMI: Practice Management Index 30

32 Key Finding #5: Insufficient Preventive Treatment CASE STUDY Preventive Tests Employees Eligible Employees NOT Compliant Percent NOT Compliant Cervical Cancer Screening % Colorectal Cancer Screening % Mammogram Exam % Cholesterol Screening % Cardiovascular Monitoring Lipid Test % Beta Blocker % 31

33 Key Finding #6: Children Not Being Immunized CASE STUDY Child Immunizations (0 3) Employees Eligible Employees NOT Compliant Percent NOT Compliant Dtap/DT % Hepatitis B % HIB % MMR (second MMR over 3) % Polio % Varicella/chicken pox (over 3) % All Shots % 32

34 Key Findings Lead to Objectives CASE STUDY 1. Establish a disease management program to achieve higher rates of treatment compliance for members with diabetes and heart disease 2. Improve adherence to recommended preventive care screening and childhood immunizations 3. Improve the overall health and wellness of the plan employees 4. Add incentives and remove barriers to good health 33

35 Objective #1: Establish a Disease Management Program for Diabetic and Heart Disease Members CASE STUDY Approach Resource Needs Communicate value of program to members with diabetes and heart disease Coordinate vendor outreach with communications from County Continue to monitor treatment compliance of employees Design benefit to reward participation and program completion Contract with disease management vendor to support programs Develop persistent, multi-dimensional communication strategy to support member education and positively brand the program Formalize mechanism to reward participation of at-risk employees (i.e., co-pay/deductible waiver) Increase County s role in diabetic member outreach Ensure effective coordination with vendor to reach diabetic employees Measure treatment compliance and establish baseline measures 34

36 Objective #1: Establish a Disease Management Program for Diabetic and Heart Disease Members CASE STUDY Year Goals 1 Contract with a disease management vendor Implement ongoing member education Remove plan barriers: modify plan design to reimburse diabetic supplies at 100% Implement incentives for program participation (lower Rx co-pays for participants; higher for non-participants) 2 Continue ongoing education Modify plan design using incentives or penalties as needed Monitor results Action Plan Key Success Metrics Achieve 40% participation Increase Hb A1C testing to 50% Increase foot and kidney exams to 30% Increase lipid testing 65% Increase eye exams to 70% Increase participation to 70% Increase Hb A1C testing to 75% Increase foot and kidney exams to 60% Increase lipid testing and eye exams to 80% 3 Continue ongoing education Modify plan design as needed Monitor results Increase participation to 80% Increase Hb A1C testing to 90% Increase foot and kidney exams to 80% Increase lipid testing and eye exams to 90% 35

37 Objective #2: Improve Adherence to Recommended Preventive Care Screening and Childhood Immunizations CASE STUDY Approach Resource Needs Communicate importance of screening and immunization to members Identify non-compliant employees Improve screening and immunization compliance of employees Coordinate outreach effort with communications from County and health plan vendor Design health benefit plan to reward compliance Expand County s communication about program Formalize mechanism to reward participation of at-risk employees (i.e., co-pay/deductible waiver) Increased County role in outreach to employees Better County and vendor coordination 36

38 Objective #2: Improve Adherence to Recommended Preventive Care Screening and Childhood Immunizations CASE STUDY Year Goals 1 Implement ongoing education campaign about heart disease Implement education campaign about adult health screening and childhood immunizations Develop targeted outreach and engagement campaigns directed at non-compliant, high risk employees Remove plan design barriers to getting preventive care (e.g., $300 preventive care cap) 2 Continue ongoing education Expand education campaign to include benefits of exercise Evaluate how plan design will be modified to create behavior change 3 Expand outreach to increase compliance Implement plan design using incentives or penalties as needed Action Plan Key Success Metrics Increase cervical cancer screenings to 67% Increase mammograms to 67% Increase colorectal cancer screening to 50% Increase child all shot compliance rate to 25% Increase cervical cancer screenings to 75% Increase mammograms to 75% Increase colorectal cancer screening to 60% Increase child all shot compliance rate to 40% Measure and identify employees who are exercising regularly Increase cervical cancer screenings to 85% Increase mammograms to 85% Increase colorectal cancer screening to 70% Increase child all shot compliance rate to 70% Improve employees exercising to at least 60% Begin physician contact process to improve compliance 37

39 Integrating Effective Communications Introducing change is one thing; getting people to understand and embrace it is something else. Consider the process: engage, educate and reinforce. To be successful, you must reach beyond employees to their families. You need to assess how you currently communicate and decide what works and what doesn t. You must connect build trust, confidence and enthusiasm. Retiree communications strategies face different challenges Retirees scatter to the wind Employers are no longer primary source of information Competing retiree plans provided to one household Predisposition of retirees - Myths Being sick is status quo; wellness doesn t apply 38

40 Implementing a Communications Program Articulate your communications objectives and develop a plan and timeline for meeting those objectives. Identify your audience(s) and understand what they need, want, know and don t know. Select tactics and distribution methods most likely to work. Evaluate available resources and how well they can help you meet your audience s needs and your organization s objectives. Establish a consistent point of view. Take ownership. Make it clear that the program is being implemented by the County not outside vendors. 39

41 Branding Your Total Health Management Initiative Branding establishes ownership and demonstrates commitment. A strong brand announces an initiative and underscores its relevance/importance. A unique brand includes a look and feel and theme that motivates employees. A brand enhances employee understanding by uniting segments of an initiative under a single banner. A brand is an organization s commitment to its message. 40

42 Evaluate the Compliance Hurdles Important to work with legal counsel in designing plan incentives and penalties. Applicable laws and rules include: HIPAA privacy HIPAA rules prohibiting discrimination based on a health factor HIPAA wellness incentive rules Americans with Disabilities Act (ADA) Tax treatment of rewards State laws (e.g., state law prohibiting discrimination against smokers) General workplace laws Applicable collective bargaining agreements Future regulation (e.g., generic nondiscrimination laws) 41

43 You May Meet Challenges Along the Way Transition obstacles for Public Sector employers Laissez Faire benefits legacy Concern over employer intrusion in medical matters All of the providers, carriers and hospitals are also taxpayers and have lobbyists 42

44 But There Are Clear Signs of Measurable Success Emergency room visits overall dropped 11% Inpatient Hospital admissions decreased 16% Inpatient hospital days decreased 27.9% Diabetes HbA1C testing rates have increased 3% (associated with decreased retinopathy, nephropathy, neuropathy and cardiovascular diseases) Diabetes LDL testing is up 28% (associated with reduction of macro vascular disease) Asthma drug compliance increased 10.2% Congestive heart failure ACE inhibitor use is up by 15% Source: Blue Cross/Blue Shield of Minnesota 43

45 Recap for Achieving Success Get plan utilization and trend data in order Make honest assessment of reality of the plan and its population Establish clear program objectives based on the data and the reality of making changes Implement plan design features to support the program objectives Endorse and brand the program changes as clear indication of management and organizational support of the program changes and the objectives they represent Develop strong and effective employee communication consistent, persistent and multidimensional Test employee understanding of the new programs as well as clarity of objectives Total Health Management program success requires continued commitment. 44

46 Questions?