Disease Management Programs A Winning Strategy in Today

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Disease Management Programs A Winning Strategy
in Todays Competitive Markets
Joe MarloweSenior Vice PresidentAon
ConsultingRadnor, PAjoe_marlowe_at_aon.com
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Agenda for Todays Session

• Setting the Stage
• Basic Principles
• Health and Productivitys Importance
• Health Behaviors and Chronic Diseases
• Health Management
• Absence and Presenteeism
• Success Indicators

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Full Service Disease Management Components

• Population identification process
• Evidence-based practice guidelines
• Collaborative practice models including physician
• Patient self-management education (primary
  prevention, behavior modification,
  compliance/surveillance)
• Process and outcomes measurement, evaluation and
  management
• Routine reporting feedback loop

Source Disease Management Association of America
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Why Disease Management?
Overall objective with disease management program
is to bring more value into the equation
Health Care Value Outcomes Patient
Satisfaction Cost

• Coordinate patient care health system navigation
• Reduce expenditure for targeted persons
• Increase worker productivity
• Improve clinical outcomes
• Improve functional status
• Enhance patient satisfaction

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Why Disease Management?

• 10 individuals spend 70 dollars
• 1 individuals account for 30
• 33 expenses for preventable conditions
• 50 to 60 hospital admissions due to chronic
  conditions

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Disease Management Debate
Disease management is the only remaining
strategy to deal with chronic diseases... Perhaps
the greatest contribution of Disease Management
lies in the fact that it has the potential to
drive change in the way we approach healthcare.
As a new concept in healthcare delivery, Disease
Management is pushing the envelope in how we
manage chronic disease. Warren Todd Executive
Director, Past President, and founding Board
Member of the Disease Management Association of
America (DMAA)
There is insufficient evidence to conclude that
Disease Management programs can generally reduce
overall health spendingThe proposition that
decreased use of acute care services might offset
the costs of the screening, monitoring and
educational services in Disease Management
programs is clearly appealing, but,
unfortunately, much of the literature on those
programs does not directly address health care
costs. Douglas Holtz-Eakin, Director of the
Congressional Budget Office
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Disease Management Market OverviewSummary
Industry Trend
Implications

Runaway medical costs continue to be the central issue in healthcare Plan sponsors are highly motivated to find cost control solutions
The industry is increasingly focused on the use of integrated interventions in controlling cost Standalone programs have limited future potential Disease Management is seeing increased interest
Disease Management (DM) attempts to address gaps in the U.S. healthcare system Payers are increasingly interested in managing high cost members
The DM industry is evolving to a total management focus Disease Management is expanding beyond the leading high cost chronic conditions
The DM market is still fragmented but a few players have emerged as market leaders Leading players are broadening their focus
There is a high level of difficulty in measuring the financial impact of Disease Management programs The industry as a whole remains very skeptical about the results of recent studies
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Potential Value of Disease Management
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Market View of Importance
Utilization
Service/Operational
Financial
Clinical
Other
Description Financial impact on medical costs Program impact on utilization Patient education Clinical indicators Participant satisfaction Patient empowerment Emerging measures
Measures 12 Month ROI Aggregate Savings ER Visits Hospital Admits HbA1C for Diabetics Who Quit Smoking Satisfaction Survey Engaged Call Center Provider Satisfaction Ease of Administration
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Health Management Continuum
Case/Disease Management
Health Promotion
Care Management

Living w/Illness (16 population)
Staying Healthy (70
population)
Getting Better (14 population)
15 costs
60 costs
25 costs

• Complex Cases
• Transplants
• Cancer
• Trauma cases
• Chronic Care
• Diabetes, asthma
• CAD, CHF, COPD
• Depression

• Risk Factors
• Alcohol/tobacco usage
• Physical inactivity
• Poor nutrition
• Health history
• Unmanaged stress
• Inadequate self-care

• Acute Care
• Broken leg
• Kidney stones
• Pneumonia

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Disease Management Purchasing

• Most government programs are still large scale
  RFPs
• The contracts are highly risk-based contingent
  on performance
• Government purchases no-frills contracts
• Health promotion/wellness and utilization
  management often absent
• Business frequently split across multiple vendors
• Programs are no longer single disease focused
• Increasing awareness of co-morbidity management
• Government is exploring new intervention methods
• Government is working to customize programs to
  the needs of specific geographies and individuals

Source Chapter House, 2005
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Managing Chronic Disease

• Identify problem diseases to target for
  management
• Plan your strategy
• Identify and evaluate vendors
• Develop innovative performance guarantees
• Negotiate contracts
• Communicate
• Implement the program
• Conduct ongoing performance measurement
• Clinical
• Financial
• Satisfaction

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Identifying Problem Disease States w/Dx Analysis

• Prevalence of chronic disease states in
  population
• Prevalence of multiple co-morbid chronic disease
• Unique members with a chronic disease
• Cost implications for those with chronic disease
• Drug costs for the chronic diseases identified
• Clinical conditions driving large dollar claims
• Identify gaps in care delivery / availability
  of programs

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Case Selection

• Affects large number of population
• Expensive to treat
• Potential for serious complications
• Avoidable complications
• Measurable impact
• Reasonable return on investment

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Identify and Evaluate Vendors Key Parameters

• Program design
• Scope of services/diseases managed
• Clinical resources
• Risk sharing/performance guarantees
• IT/Technology
• Remote patient monitoring to gather clinical data
  coupled with smart system intervention (e.g.,
  scales, blood pressure, glucose monitors)
• Enrollment processes
• Communication
• Reporting

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Essential Components for Successful Program

• Data driven identification and risk-stratification
  
• Predictive technology gives no insight into
  supportive environment for targeted individuals
• Proven enrollment approach
• Readiness to change engage person directly
• Proactive patient outreach
• Participation incentives
• Use of evidence-based treatment guidelines
• Customized care plans to meet each patients
  unique needs
• Management of co-morbid conditions
• Clinical, financial, and satisfaction outcome
  reporting
• Performance guarantees

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Important Evaluation Steps

• Develop comprehensive RFP
• Incorporate your specific requirements
• Secure the necessary information from the vendors
  to address your particular needs and expectations
• Prepare summary evaluations of selected vendors
• Develop selection criteria
• Complete site visits with finalists
• Provide data for analysis by finalists
• Select a partner(s)

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Purchaser Cautions

• Most vendors sound the same
• Have clear idea of program objectives
• Get beneath vendors skin
• Negotiate performance guarantees

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Performance Guarantees and Contract Negotiations

• Guide the development and selection of meaningful
  performance guarantees (clinical, financial,
  satisfaction)
• Craft risk and reward program that provides
  incentives to advance your financial interest
• Secure the best possible terms and contract
  conditions
• Financial risk sharing less popular due to
• Higher fee structure to cover reinsurance
  premiums
• Proven results make risk sharing less important

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Member Communication Critical Ingredient

• Identify audiences and challenges for reaching
  them
• Determine appropriate strategy and media
• Match messages to audience
• Not Big Brother
• Determine appropriate incentives for targeted
  groups
• Financial
• Non-financial
• Coordinate flow of information from the vendor
  and your organization
• Monitor and refine communication plan, as needed
• Reinforce message periodically

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Some Considerations

• Population-based approach to health management
• Wellness services to assist those at risk of
  chronic condition
• Coordination with case management resources
• Single person, single disease state management
  losing appeal
• Partner with local medical providers and
  community resources
• Behavioral health assessment and treatment
• Depression or chemical dependency as primary or
  secondary diagnosis
• Technology becoming increasingly important
• Online program educational materials (symptom
  advisor)
• Provider reports
• Patient profiles

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Realities of the High Risk Population

• Sicker than most DM vendors anticipate
• More intensive management needed (higher
  intervention costs)
• Need to tap into social services
• More costly during early patient attraction phase
• Psychosocial (not pure medical) challenges
• Demands more social workers to be effective
• More costly engagement strategies (lack of phone
  numbers)
• With effective overtures, expect solid voluntary
  program enrollment
• May require that gt70 of targeted group enroll to
  give ROI
• High satisfaction demonstrates pent up demand for
  DM services
• Premium on speed of intervention
• Same day early alert for hospitalizations and
  discharges
• Role for face-to-face assessments
• Substitute for less expensive, traditional call
  center approach
• Role for local pharmacists

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Importance of Healthy Behaviors
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Mortality Risk Factors In The U.S.
Source Centers for Disease Control and Prevention
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Difference in Medical Costs - High vs. Low Risk
Source Goetzel,JOEM, Vol. 40, No. 10 Oct. 1998
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Economic Case for Health Management Programs
Source StayWell data analyzed by U of Michigan
(N 43,687) HERO Study
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Obesity A National Challenge

• Considered of epidemic proportion
• 31 of adults and 16 of adolescents
• Metabolic syndrome contributes to risk of serious
  disease
• Increased blood pressure
• Elevated insulin levels
• Excess body fat around the waist
• Abnormal cholesterol levels
• Physical inactivity and unhealthy eating primary
  contributors

Source National Center for Policy Analysis, May
2003 JAMA, 1999
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Medical Costs and Risks by Body Mass Index
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Impact of Weight Loss on Risk Factors
1. Wing RR et al. Arch Intern Med.
19871471749-1753. 2. Mertens IL, Van Gaal LF.
Obes Res. 20008270-278. 3. Blackburn G. Obes
Res. 19953 (Suppl 2)211S-216S. 4. Ditschunheit
HH et al. Eur J Clin Nutr. 200256264-270.
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Chronic Disease Linked to Obesity

• Cardiovascular diseases
• Diabetes
• Hyperlipidemia
• Gout
• Osteoarthritis
• Gallstones
• Cancers

Obesity accounts for 5-8 of direct medical costs
and leads to premature disability and mortality
Source Cas Lek Cesk. 1997 Jun 12136(12)367-72.
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Depression The Silent Cost Driver

• Depression can be triggered by a chronic disease
• Depression can be a marker for other conditions
• Research links depression to the later
  development of
• Asthma
• Diabetes
• Heart disease
• Hypertension
• Obesity
• Stroke

Source Centers for Disease Control and Prevention
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Market Trends

• Many vendors have entered this market, but only a
  few can offer the
  entire range of services
• Lots of Health Plans, TPAs, HMOs, DM vendors, HRA
  and other specialty vendors operate in this space
• Fair amount of purchasing, partnering, and
  outsourcing
• Some vendors have superficial offerings that lack
  design and execution capability
• Participation rates
• Intensity of interventions
• Results
• Resist the temptation to generalize across
  vendors
• Learn to differentiate among vendors
• ROI less important than program design and
  execution
• Vendors control ROI methodologies and
  calculations
• False expectations of high ROI savings

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Vendor Differentiators

• Risk identification process (HRA tool, assigning
  risk factors)
• Healthcare coaching model (outreach,
  interventions, consistency)
• Track record on connecting and engaging targeted
  individuals
• Technology (portal, personalized programs,
  flexibility)
• Web content
• Integration with employer plans and vendors
• Participation incentives (ability to administer)
• Metrics
• Communications
• Future initiatives/enhancements

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Disease Management Outcomes Measurement (ROI)

• New focus on utilization rather than pre-post
  cost analysis
• Unproductive debate about statistical biases for
  cost-based studies
• Chronic disease-related hospital admissions and
  ER visits
• ALOS and readmission rates
• Literature does not point to reductions in
  outpatient visits, pharmacy, etc.
• Question If there a sufficient number of
  avoidable admissions to justify DM program fees?
• Standard costs per avoidable hospital stay times
  potential reduction compared to DM program fees
• Standard financial cost methods may overstate
  savings
• What are the savings assumptions used by your DM
  vendor?
• Are they specific to your unique population?
• High risk group ROIs may be less than commercial
  population
• Confounding variable member turnover and deaths,
  multiple conditions (diagnoses)
• Population risk adjustment of baseline and
  intervention