Funding chronic disease prevention

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Funding chronic disease prevention management

• Professor Hal Swerissen
• Acting Dean
• Faculty of Health Sciences
• Chronic disease management forum, Brisbane, 8
  November, 2006

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Why worry?
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• About 40 of the population have a chronic
  condition
• Chronic conditions account for more than two
  thirds of health expenditure
• A limited number of chronic conditions have the
  most significant impact on costs
• CD is heavily age related
• The population is ageing rapidly
• Demand will increase dramatically

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DALYs attribute to CD
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Health system costs 2001
Source AIHW 2004
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How good is what were doing?
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Poor quality care
Source McGlynn et al (2003) NEJM 348(26)
2635-2645
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Source McGlynn et al (2003) NEJM 348(26)
2635-2645
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Source McGlynn et al (2003) NEJM 348(26)
2635-2645
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Inefficient ineffective services

• Unidentified risk disease
• Sub optimal primary secondary prevention of
  chronic disease
• Sub optimal treatment of chronic disease
• Fragmented service system and pathways
• Inequity (personal, location, condition)
• Avoidable death, disability, distress cost

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Whats the solution?
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Improved outcomes reduced costs
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Funding disincentives

• Medical pharmaceutical
• Uncapped FFS
• Acute care
• Capped casemix
• Sub acute ambulatory
• Capped historical output
• Community support
• Capped output
• Private health insurance

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Design problems

• Focus on outputs not outcomes
• Focus on services not people
• Inefficient (constrained) service purchasing
  rules
• Short term episodic
• Inadequate risk adjustment on long term case
  payments (under resourcing and adverse selection)
• Inadequate focus on dynamic efficiency capacity
  building (RD)

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Funding trends

• Hospital Demand Management
• Enhanced primary care items
• Package funding
• Ancillary PH changes
• Aims
• Diversion
• Substitution
• Prevention
• Coordination integration

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Problems with current initiatives

• Contradictory Cw state aims
• Contradictory payment incentives sanctions (see
  above)
• Piecemeal fragmented design capacity building
  approach (by disease, service system
  jurisdiction)

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Payment design principles

• Comprehensive person focused (e.g. enrolment,
  longer term, broad scope)
• Care pathway focused (e.g. integration
  coordination)
• Outcome focused (e.g. clinical indicators, QoL)
• Prevention early intervention focused (e.g.
  resource shifts to PC)
• System redevelop capacity building focus

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Evidence

• Whole of system studies (e.g. Ham et al, 2003,
  BMJ, 327)
• ROI studies
• RCTs on CD management model effectiveness (e.g.
  coordinated care studies)

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Revolution?
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• Jurisdictional realignment to one level of
  government unlikely
• Full privatisation introduction of competitive
  insurance plans whole of care enrolment
  unlikely
• Regional budget holding models unlikely

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Evolution?
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• Funding for hospital outreach programs (high end
  HDM) (happening)
• Expansion of Medicare items (early intervention)
  (happening)
• Contractual funding for GPs primary care
  (maybe)
• Reform of HACC (maybe)
• Reform of GP incentives schemes (maybe)

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