Gordon Norman, MD, MBA

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.a health and consumer services company making
peoples lives better
Disease Management
Gordon Norman, MD, MBA VP, Health Care Quality
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Pre-CY2000 DM Behind Veil Of Capitation
Pre-2000 Era
HEALTH IMPROVEMENT
DISEASE MANAGEMENT
Population-based
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Post-CY2000 Risk Shift Paradigm Shift
Post-2000 Era
Post-2000 Era
HEALTH IMPROVEMENT
DISEASE MANAGEMENT
HEALTH MANAGEMENT
Population-based
Case-based
4
Disease Management Spectrum Of Needs
Catastrophic Care Management Complex case
management Special Population Care Frail members,
ER frequent users, Pre-catastrophic care,
Terminally ill members Chronic Disease
Management CHF, CAD/stroke, COPD, ESRD Diabetes,
Depression, AMI Acute Episode Management In-/Out-p
t. Medical Management Transitional, Continuity of
Care Preventive Health Management Preventive
care/Risk reduction Health improvement, Member
education
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Origins of a Bedday
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Classic Utilization Management ALOS Focus
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Focused Acute Episode Management

• ALOS Management
• managing capitation to shared risk conversions
• change from PMG to Pareto group hospital focus
• PacifiCare as consultant and resource
• Every Patient, Every Day mantra
• sophisticated informatics and reporting
• onsite concurrent review coverage at outlier
  hospitals
• Medical Director-led regional medical teams
• Hospitalist programs increasing
• achieving Commercial and Medicare utilization
  results

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Daily Census PCC, PHS
Medicare
Commercial
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ER Slippery Slope to Hospital Admission
Hippocratic Oath primum non nocere Division of
clinical roles, responsibilities Rescue ethos
active over passive mgt. Little time for
discharge planning Legal risks (COBRA,
EMTALA) Clinical uncertainty of dx,
px Uncertainty of patient F/U Financial
reimbursement Family/caregiver anxiety Discretiona
ry gray zone Limited clinical history Patient
expectations Relative time, effort Hospital
economics Patient advocacy Malpractice
risk Convenience Liability risk Habit
Easy out-pt. coordination Primary care
continuity Member disincentives Diversion
alternatives Social work resources Hospitalist
incentives Family expectations Quick, easy HH
svcs Available SNF beds 24 hr. observation Full
hospital beds Onsite RN triage DSS, protocols
ER
Discharge
Admit
Lesson its often too late by the time the
member is in ER avoiding the slippery slope
requires upstream medical management
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Upstream Medical Management Admits/K Focus
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Pareto Analysis Top 5 Most Costly Members
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Disease Management Sourcing Preferences

• Outsourcing preferred
• major focus is primary disease driving majority
  of members utilization/costs
• specialized skills not easily developed or
  recruited
• use of proprietary tools
• economies of scale, scope
• performance data available
• performance risk accepted

• Insourcing preferred
• major task is support, integration of many unmet
  member needs that result in excessive health care
  resource consumption
• generalist, social mgt more critical than
  specialist skills
• integrating community resources important
• no proprietary tools needed

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DM Opportunity Analysis Conclusions

• Most promising choices for outsourced DM
• ESRD cancer
• CHF rare complex disease medley
• CAD/stroke neonatal care
• COPD asthma
• Appealing insourced CM candidates
• End-of-life care (cancer, chronic diseases, HH
  services, family support, hospice, AMDs,
  palliative care)
• Frail members (chronic disease, disabled,
  homebound)
• ER frequent utilizers (chronic disease, access,
  compliance)

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Congestive Heart Failure California
Mem Mos
11,741
66,297
11,741
66,297
0
-55
-51
1
SH Net Savings 6.3M
Mem Mos
1,069
6,408
1,069
6,408
-49
-11
-62
-10
CO Net Savings 2.3M
Baseline Period 12/1/99 - 11/30/00
Intervention Period 12/1/00 - 11/30/01
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Chronic Obstructive Pulmonary Disease California
Mem Mos
11,395
15,815
11,395
15,815
-4
-3
-37
-28
SH Net Savings 2.9M
Baseline Period 4/1/00 - 3/31/01 Intervention
Period 4/1/01 - 11/30/01
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End Stage Renal Disease California
Mem Mos
4,238
4,238
-26
-8
SH Net Savings 0.7M
Mem Mos
875
875
-43
8
CO Net Savings (0.4M)
Baseline Period 4/1/00 - 3/31/01 Intervention
Period 4/1/01 - 11/30/01
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Frail Member Care PCC
Mem Mos
5,121
13,654
5,121
13,654
-1
-29
-17
0
SH Net Savings 4.8M
Mem Mos
1,072
2,228
1,072
2,228
-10
-8
-16
4
CO Net Savings 0.4M
Baseline Period 11/99 - 10/00 Intervention
Period 11/00 - 11/01
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End of Life Care PCC
Mem Mos
579
8,241
579
8,241
-24
12
-6
1
SH
Baseline Period 1/00 - 12/00 Intervention
Period 1/01 - 11/01
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Disease Management Portfolio 2002

• Outsourced DM
• original 4 outsourced CHF, CAD/stroke, ESRD,
  COPD
• launching commercial Oncology DM
• design middle tier diabetes pilot
• pursue pediatric asthma
• reconsider rare disease medley
• maximize appropriate, early provider referrals
• promote successful programs to capitated
  providers
• increase penetration in non-capitated provider
  groups
• implement DM programs for PPO, ASO business

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Disease Management Portfolio 2002

• Insourced DM
• Frail members
• End of Life members
• selective catastrophic case management
• comorbid, EOL patients from outsourced DM
  programs
• maximize appropriate, early provider referrals
• integrate workflow with outsourced vendors
• pre-catastrophic case management as predictive
  modeling allows (DCG, RxGroups, ACG, CRG, CRxG,
  Ingenix, Medical Scientists, MR, RxSols)
• combine predictive modeling with HRA
  stratification

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Disease Management Portfolio 2002

• Apply DM learnings to other outsourced service
  providers
• Hospitalist contracting for in-pt. care
  management, ER intervention
• neonatal/NICU management
• Improve integration across comorbidities,
  vendors and PHS, providers
• Subject our DM performance to rigorous challenges
• CMS Disease Management Demonstration Program
• CMS PPO Demonstration Program
• external validation of savings methodology
• external audits of DM capabilities, effectiveness

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Double-Barreled Approach CAD
CAD Programs
Lower Risk
Higher Risk
Population-based
Case-based
Taking Charge of Your Heart HealthSM
DM vendor
Evidence-based management of CAD
Includes all members with CAD
Member and Provider Interventions
Member Testing, Provider Intervention
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Triple-Barreled Approach Diabetes
Diabetes Programs
Low Risk
Moderate Risk
High Risk
Population-based
Case-based
Case-based
Taking Charge of DiabetesSM
4 DM vendors
1 DM vendor
Manage diabetes-related end-organ conditions
Includes all members with diabetes
Diabetics with worst control, highest risk,
readiness to change
Coronary artery disease Congestive heart
failure End-stage renal disease
Member and Provider Interventions
Intensive Member Case Management
pilot program in negotiation
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Newest DM Program Cancer

• Why cancer?
• Shortage of medical oncologists (cancer doctors),
  all too busy
• MDs unfamiliar with oversight of total patient
  care
• Technical, sophisticated treatment emphasized
  over education, empathy, preparation for end of
  life
• MDs tend to use most convenient setting for them,
  not the patient
• Difficulty discussing, dealing with death
• Futile and unwanted treatment not uncommon within
  commercial populations
• Preparation for end of life is variable, late, or
  neglected

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Whats Different about Cancer DM?
lt 1 Month

(Futile Treatment)
-
End-of-Life

Diagnosis
Primary Treatment

(Unwanted Treatment)

Traditional Practice
Palliative Care

Curative Anticancer Treatment

Pain


Hospice Referral


Management
Diagnosis
Primary Treatment
End-of-Life
Curative Anticancer Treatment
Cancer DM Approach
Anticancer Treatment
Palliative Care
Palliative Care
Psychosocial Counseling
Pain Management
Cancer Rehabilitation
Advanced Care Planning
Hospice Referral
Ongoing Symptom Management
Fatigue Management
Nutrition Services
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Today Full Service Health Management
HEALTH IMPROVEMENT
DISEASE MANAGEMENT
ü
ü
ü
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HEALTH MANAGEMENT
Population-based
Case-based
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Disease Management Baked Into Our...

• Brand Promise
• Quality Initiatives
• HEDIS Performance
• NCQA Accreditation
• Medical Management
• Member, Provider Satisfaction
• Competence/Achievement Culture
• Financial Performance Membership Growth