Disease Management, ie Population Health Management Organizations (PHMOs): Plan B to Support the Creation of the Patient Centered Medical Home (PCMH)

As the Disease Management Care Blog has previously pointed out, there is is a lot that the disease management industry has to offer the Patient Centered Medical Home (PCMH). That's why it agrees with this webinar summary that appeared in the latest issue of Population Health Management.

In it, Darren Schulte MD of Alere points out that expectations for the PCMH are very high. Its value proposition includes reversing the decay of primary care, meeting the consumerist needs of an aging population, increasing quality and securing additional practice income. A growing body of evidence suggests that the more successful PMCHs have 1) a dedicated non-physician patient coordinator, 2) expanded in-person and virtual patient access, 3) health information technology that includes a functioning registry and point-of-care decision support and 4) increased practice income. Without these key ingredients, PCMHs have an uphill battle managing a population of patients, building a team-based culture and marshaling resources to change patient behavior.

Enter disease management vendors, although Dr. Schulte prefers to use the politically correct term "population health management organizations" (PHMOs) They have decades of experience in patient education, monitoring, self management, treatment adherence and care coordination. Despite physician skepticism and a cultural bias that favors "build" over "buy," he argues that PCMHs may find PHMOs attractive not only because they're speaking the same language, but because their services are "plug n' play" and highly adaptable across a wide variety of small to large settings. All that needs to be worked is out how PHMO support will be paid for so that the PCMH succeeds.

Enter Dr. Greg Sharp of Ideal Family Healthcare in Woodland Park, CO. He notes that health insurers have a key role to play because they're not only providing the additional monthly payments for the PCMH, but they're being called on to support health information technology solutions and provide work-flow consultation services. Since insurers are very involved anyway, he implies that it's not a great leap form them to also facilitate the sponsorship of PHMOs in the PCMH network. Once that happens, he sees few barriers standing in the way of PCMH team members virtually working with remote or in-person PHMO health coaches, accessing the PHMO's registries and relying on PHMO decision support tools.

The acronym addled DCMB likes this description of how insurer sponsored PHMOs can help PCMHs. For a fiduciary and risk-bearing health insurer, the DMCB agrees that the road to patient behavior change, prevention and savings in medical homes may run through disease management. The DMCB suspects many primary care practices won't necessarily want to create (training the non-physicians in behavior change and coaching?) or be able to afford (buying the hardware and programming expertise to create a fully functioning registry?) all the features of a fully transformed PCMH. Calling it "PHMO" instead of using the scorned term "disease management" will also increase its acceptability.

Smart health insurers will recognize that there will be primary care sites that want to go their own way in establishing PCMHs. That's fine. For those primary care sites that may not have the resources or the inclination to build a fully functioning PCMH, bringing in a "population health management organization" vendor is a good Plan B. That disease management Plan B is a rose that by any other name still smells as sweet in the science of increasing quality and optimizing costs.

The Definition of Medical Necessity and Using It When Dealing With Health Insurers

Physicians, meet Mrs. "Smith." She's undoubtedly resembles many of your own patients. Like them, she is very frail and has more than her fair share of chronic conditions. Thanks to your diligent care, she has a good chance of seeing her great granddaughter this summer and, if the both of you are lucky, she won't see the inside of a hospital for years to come.

Unfortunately, however, the times they are a changin'. Mrs. Smith's health insurance may no longer "cover" your referral for a specialist consultation, your order for a expensive radiological imaging study or your prescription for a new medication. That's because she has been caught up in a thicket of shifting benefit designs, utilization management initiatives and coverage exclusions. Dealing with her insurance company is a maze-like exercise in professional frustration that sucks the joy out of medical practice faster than salaried docs exiting an Urgent Care Clinic at the end of their shift.

When the DMCB teaches, lectures and provides conferences for young physicians and medical students, it says the fix for Mrs. Smith's dilemma is two-fold.

First of all, it says, physicians need to familiarize themselves with the basics of health insurance. Once docs understand risk transfer, underwriting, trending, contracts, reserving, surplus management and regulatory oversight, the DMCB thinks they'll be better able to advocate on behalf of their patients at both a local and national level. That will take time and effort. It's too important to leave to the experts. One good way to deal with that is for docs to regularly read the DMCB.

Secondly, docs need to learn to use the words "medical necessity." This is one of those basics described above that, if raised at the right time when dealing with an uncooperative health insurer, is more likely to get Mrs. Smith the coverage for the services.

Medical necessity is a key concept used by insurers and regulators to describe any health care intervention that is:

(a) recommended by the health care provider;
(b) treatment for a medical condition;
(c) at an appropriate level of service or supply
(d) considered to be effective in improving health outcomes, as determined by scientific evidence, accepted standards of medical practice, or, expert opinion
(e) cost-effective for this condition compared to alternative interventions
(f) not solely for the covered person’s convenience or the convenience of the covered person’s family or physician.

While there are exceptions, health insurers are obliged to cover all medically necessary services.

The DMCB recognizes that calling an insurer's 800 number, faxing copies of medical records, completing preauthorization forms and tabbing through a web site can a dreadful and demeaning experience. That's not the point. The point is that, a live employee of the insurer is going to have to eventually read or listen to what you have to say. Physicians' chances of prevailing on behalf of Mrs. Smith will be significantly increased if that employee hears or reads the words "medically necessary" somewhere in the course of your appeal. If they know that you can argue the merits on that basis, your chances on behalf of Mrs. Smith will improve.

How not to deal with an initial denial for payment coverage for a CAT scan:

"I want to rule out a tumor, so I need this imaging study stat. Please approve"

A better way to deal with that denial for a CAT scan:

"As a physician, I've determined that this patients' new symptom of pain could be consistent with a diagnosis of cancer. A CAT scan is the best first step imaging study to address this possibility based on my professional judgment and prevailing practice standards. There is no reasonable alternative imaging modality or other option to adequately address the diagnosis. I and my patient look forward to hearing from you shortly about coverage for this medically necessary service."

More On the "Call for Comments" and Here's One From JD Salinger's Fat Lady

The Disease Management Care Blog has gotten some terrific one sentence 'messages' in response to its "call for comments" to share at an upcoming U.S. medical school lecture. If your submission has not appeared anywhere among the DMCB's vast array of web portals, fear not: it's in there. Your comments are being compiled with others, dropped into PowerPoint and will likely appear in a future DMCB posting.

Comments are still being accepted through early next week. This is your chance to educate, impress and influence a roomful of future doctors. Posts here, email, tweet, Facebook and LinkedIn are all accepted.

By the way, the DMCB is **NOT** going to teach about, let alone mention, "disease management." Rather, the lecture will deal with various approaches to health care financing and risk transfer.

The DMCB is planning to conclude the lecture with a comment that touches on a favorite topic borrowed from J.D. Salinger's literary masterpiece Franny and Zooey. That would be the "Fat Lady," or how contemplation, reverence, submission and service can can light up the universe that lingers just beyond the reach of rational thought. This is the astonishing insight from brother Zooey that pulls the gifted radio star Franny Glass out of her nihilistic funk.

Physicians are especially privileged because they have a leg up on discovering their own personal Fat Lady. She exists in every patient and she calls to us. And she is now telling us that, while diagnosis and treatment are still "Job One," we docs are also being called to apply new skills in reconciling ethics, financing, public health, health literacy, lifestyle issues, socioeconomic status and third party meddling:

Zooey's explanation to Franny:

[I was told] to shine my shoes...I was furious. The studio audience were all morons, the announcer was a moron, the sponsors were morons, and I just damn well wasn't going to shine my shoes for them... I said they couldn't see them anyway, where we sat. He said to shine them anyway. He said to shine them for the Fat Lady. I didn't know what the hell he was talking about, but he [had a] ... look on his face, and so I did it. He never did tell me who the Fat Lady was, but I shined my shoes for the Fat Lady every time I ever went on the air again -- This terribly clear, clear picture of the Fat Lady formed in my mind. I had her sitting on this porch all day, swatting flies, with her radio going full-blast from morning till night. I figured the heat was terrible, and she probably had cancer, and -- I don't know. Anyway, it seemed goddamn clear why [I had to] shine my shoes when I went on the air. It made sense.

And now the Fat Lady is telling physicians that while morons abound, understanding the principles underlying risk transfer and how insurance works is important because will help you get your patients the care that they need. In other words, knowing how and why health care services are financed and what can be done about it at the individual patient level is no longer the job of that lady sitting on that porch.

Here's the DMCB comment: Docs need to shine those shoes.

A Primer On Insurance Exchanges, Courtesy of the New England Journal (plus, what about the brokers?)

Thanks to an article (here too) in the published June 10 New England Journal, the Disease Management Care Blog got to bone up on the issue of on-line health insurance exchanges. Written by Massachusetts Commonwealth Connector's Jon Kingsdale, it gives readers a well written if enthusiastic snapshot of what a lot of of us can look forward to on January 1, 2014 when we start buying insurance on-line.

You can also look forward to this handy DMCB summary, suitable for a few minutes of your precious time.

By the way, two State exchanges have been set up: Massachusetts (which Dr. Kingsdale says was the model for the Patient Protection and Affordable Care Act) and Utah. Both are available for on-line test drives.

According to the article, exchanges will generally have to be run by the States (including the option of outsourcing it to a not-for-profit entity). They'll be funded by a transaction tax that is anticipated to amount to about 3% of premiums. Mathematically, this is a great deal for individuals and small groups, whose premiums often include higher administrative costs compared to the large "bulk" purchasers. The job of the Exchanges is to present transparent and easy to read on-screen summaries of the various health insurance options so that consumers can comparison shop. This means not overloading users with too much information; rather, the Exchanges will give users standardized information so that they can balance the premiums, deductibles, co-pays, pharmacy benefits and other information to make truly informed choices that fit their personal preferences. The Exchanges will also set up the various tax credits and the subsidies that kick in below the 400% Federal Poverty Level (FPL) threshold. Established health insurers will need to compete and the market barriers to new insurers should become lower. As a result, hopes Dr. Kingsdale, health insurers that 1) achieve consumer-friendly levels of efficiency and 2) don't have to resort to wide-open networks will win the Exchange-mediated race in the long run.

For a slightly different point of view on how things are being done in the era before Exchanges, check out this 2002 Center for Studying Health System Change Issue Brief On the Role of Insurance Brokers. Brokers - the folks that are paid by commissions by insurers to refer potential customers to them - have generally commanded from 2%-10% of the premium. Their job is present customers with a tailored spreadsheet of the insurance options that they represent, so that individuals and employers can presumably chose what's best. What's more, after the sale, brokers often act as trouble shooting intermediaries between the health plans and consumers.

The DMCB recently relied on a broker for its health insurance. There were four dominant insurers and the broker provided a packet with pages of easy to understand options. They answered the DMCB calls, responded to the DMCB emails, took my faxes and called the DMCB after one year at renewal time. They were not at all like the government.

What can the DMCB conclude?

1. Brokers' with a majority of their business in health insurance are in trouble.

2. Yet, brokers' fees don't seem to be that much higher than the Exchange costs described by Dr. Kingsdale. It may be that the DMCB and other health care consumers will confirm the adage that you get what you pay for.

3. The article points out that Exchanges are one area of agreement from both sides of the health reform debate. What better example of that than Utah and Massachusetts?

4. Dr. Kingsdale's speculative closing plug that Exchanges will usher in an age of highly efficient competing closed networks (much like Accountable Care Organizations) seems a little far-fetched. If that were true, the health insurance brokers would have done that long ago. It seems the conceit of everyone in health care policy with a good idea is that their idea can fix everything.

5. Last but not least, the DMCB hopes the on-line Exchanges will eventually list the health insurers' coverage options for wellness, prevention and chronic disease care management. Stay tuned.

Another Media Failure Over A Questionable Study: Medicare Associated With Increased Trauma Deaths? No Better Than NOT Having Insurance?

Did you know that Americans with Medicare health insurance have a higher adjusted mortality rate from trauma compared to persons with commercial insurance?

The Disease Management Care Blog explains.

According to numerous news outlets such as ABC News, MSNBC, the Huffington Post and Reuters, a study's been published that shows that not being insured at the time of hospitalization for trauma leads to a higher death rate. Adding to the drumbeat of liberal dismay over lives lost for lack of a public option, this research by Rosen and colleagues, published in the prestigious Archives of Surgery, shows there are 'sky high' death rates (Democratic Underground) that are 'shocking' (Daily Kos) and could be the evil consquence of 'less enthusiasm on the part of providers.... once it was realized they would not be compensated' (Physicians for a National Health Program). Of course, the luster of this scientific report was only enhanced further by the inclusion as author of superstar surgeon Atul Gawande, that (in)famous author of the New Yorker article that used the shortcomings of single outlier McAllen Texas to call the entire U.S. healthcare system to task.

Like the media, should the DMCB be impressed by a published study in a prestigious journal by rock star authors? Just take their word for it? Actually no, because the purpose of peer reviewed literature is to allow readers to assess the research findings and decide for themselves. It's called trust, but verify.

So, unlike the attention-deficit disordered denizens of the oxygen-deprived mediasphere, the DMCB responded in a novel way. It decided to pull the study and actually take the time to read it.

Here's what it found. Data from 2.7 million U.S. hospitalized patients were mined, looking for correlations between death and insurance status while mathematically neutralizing the effect of age, gender, race, the type of trauma center as well as the type of trauma. Persistent and statistically significant correlations were found between dying and a) increasing age, b) race (being black plus young) c) the severity and mechanism of the trauma (for example penetrating injury is bad), d) an increased number of comorbid illnesses and e) insurance status.

In fact, two types of insurance status had statically significant associations with a higher death rate: 1) not having any health insurance and 2) being on Medicare. If you look at the graphic from the study, you'll see that compared to commercial insurance, Medicare had a statistically significant odds ratio of a higher death at about 1.5, while no insurance was also high at 1.8. Look carefully, because the lack of an asterix means the finding is statistically significant.

The DMCB thoughts about the implications:

1) What should the 'comparator' be? We don't know. One separate study used managed care as the baseline while this other study used Medicare. Since there is no generally accepted baseline for research like this, the author's choice of using commerical insurance as the gold standard in this article made not having insurance look bad. If Medicare had been the standard, persons without health insurance probably would not have turned out to be worse. Even more ironically, managed care (accounting for the majority of U.S. commercial insurance) would have turned out looking better. Interestingly, the authors neglected tell us why they chose this approach.

2) Are the authors (and the Archives' editors) politically motivated? There is one explanation for the use of the commerical comparator: it's a ringer that makes everyone else look bad. What's more, failing to mention that Medicare insurance status was also associated with lower survival rates is either a monumental lapse or an intentional attempt to understate a finding that is also important. Knowing that policy makers, media and many readers won't get past the title ('Downwardly Mobile. The Accidental Cost of Being Uninsured'), the abstract (no mention) and some juicy interviews, only half the story is being told. The full story is that when it comes to trauma care, giving everyone Medicare-style insurance is no better than no health insurance at all. This is a great example of framing, especially since the asterix seem to call the readers' attention away from Medicare's inconvenient......

3) Are some other potential explanations? While a lack of health insurance is associated with poor health outcomes, it is also known that having poor health leads to lack of insurance. Accordingly, the mathematical 'signal' from being nominally 'uninsured' in this study may really be due to the influence of unmeasured health or other issues that were not captured in the data base. That's called systematic bias and it went completely unmentioned as a potentional shortcoming in the authors' discussion of their results. Assuming the results are real, the DMCB believes post-hospitalization care (rehab and outpatient) is generally not well covered and coordinated under Medicare, which in turn leads to problems.

4) Association is not necessarily causality. Just because not having insurance is associated with death from trauma doesn't mean giving this poverty-prone population insurance will reverse things any more than the association between white hair and more heart attacks (due to age) can be fixed by dying everyone's hair black. Likewise unmentioned by the authors.

Once again, the media has demonstrated its shortcomings. What's more, the peer reviewed process has shown how necessary it is to look at the results for yourself: you can't always count on the authors or the editors to look at all sides of the data or rise above their prejudices. Lastly, there's an old joke out there that is sometimes told by us general internists: how do you create a double blind study? Get two or more surgeons involved.

This publication was double binded.

At the time of this posting, the DMCB had an email into the author asking for feedback. None yet

Informed Refusal: The Doctor Told Me To Come Back When I Had Health Insurance

You're probably familiar with this unlikely and oft-quoted scenario. Patient with disease sees doctor, who peforms a wallet biopsy. After determining the hapless sap is unlikely to pay for the needed medical diagnostic procedure or treatment, the doctor says 'come back when you have health insurance.'

At least that's what the media says.

The Disease Management Care Blog thinks the reality is far more complex:

Doctor: 'How can I help you?'

Patient: 'I saw blood in my [insert name of body fluid] .'

Doctor: 'You're going to need additional testing.'

Patient: I don't have health insurance, so how much is it going to cost me?'

Doctor: 'Well a [insert name of organ]oscopy will cost [insert number] [insert hundreds or thousands] of dollars.

Patient: 'I can't afford that.'

Doctor: 'You can't afford not to have that. Get it done and worry about paying for it later. I'm sure something can be arranged.'

Patient: 'It isn't going to happen. No way can I pay for it, I'm already up to my ears in debt.'

Doctor: 'The test can't be done for free. I strongly advise you to get it done'

Patient: 'No can do.'

Doctor: 'Well, why don't you come back when you have health insurance.'

Years later, when the patient's cancer has progressed to its terminal stages, he is asked how the early symptoms were ignored. The patient's response:

'The doctor told me to come back when I had health insurance.'

The Disease Management Care Blog has seen many patients without health insurance and never dismissed them after a negative 'wallet biopsy'. The typical physician doesn't either. Instead, after confronting the sticker shock of today's real health care costs, it's the patients who often chose to forgo their physician's recommendations based on financial considerations. Weeks, months or years later, what patients remember is how their lack of health insurance put affordability out of reach.

It's been known for a long time that patient recall of the details of past physician encounters is often at variance with what is written in the medical record. When it comes to smoking cessation counseling, this study indicates patient recall tends to be high. On the other hand, recall about the details of the advantages and disadvantages of spinal surgery can be surprisingly low. To complicate things further, recall may be influenced by ethnicity. Of course, not only is patient recall inaccurate, but physician documentation of what happens during the course of a clinic visit often leaves much to be desired. Fixing this shortcoming (for example, with the use of decision supported 'smart forms') is among the many supposed advantages of the electronic record.

The DMCB searched the published literature to see if there were any studies that compared patient recall of the details of what physicians really say about their patient's lack of insurance, what they write in the medical record and what their patients actually remember. There are none. Given the media's less-than-perfect track record on reporting health care in general, the problem may be way overblown.

Some potential solutions:

For the young academics casting about for a research project: use the same 'patient recall' methdology used on prior studies to scientifically compare what really happens to what patients remember in 'no health insurance' discussions. This is very publishable.

For news media: understand that what patients tell you about past conversations with physicians can be inaccurate, if not superficial. Ditto what physicians write in the chart. You are doing a disservice if you give into your biased assumptions and don't dig deeper.

For physicians: if a patient has no health insurance refuses a recommendation on the basis of out of pocket costs for lack of health insurance, approach it like your would informed refusal and take the effort - as always - to document everything. Since physicians typically say much more than 'come back when you have insurance,' the misinterpretation of that phrase makes the DMCB think it should be abandoned and never used in a medical record (unless thats what you really said, you heel).

For electronic health record vendors and CIOs: Develop a 'smart form' that can be used by physicians when they are treating a patient who refuses a recommendation due to financial reasons. For example, 'After discussion of the risks, benefits and alternatives to [insert name of test, diagnostic procedure or treatment here] including the possibility of disease progression and death, the patient, due to financial considerations and the lack of insurance coverage, decided to forego my recommendations. The patient was informed about the need to seek alternative financing alternatives and indicated understanding about that need. The patient was strongly encouraged to return in the near or distant future if there is any change in the decision to forgo my recommendation because of financial considerations.'

For readers: Next time your read about an anecdote about greedy physicians telling patients to come back when they have insurance, be skeptical. There is probably far more to the story.

The Option of a Public Insurance Plan and the Specter of More Cost Shifting

Advocates for healthcare reform that includes the creation of a publically funded insurance plan are delighting in news that both AHIP (America’s Health Insurance Plans, the trade group that represents health insurers) and Blue Cross Blue Shield (a federation that represent 39 insurers that sport the Blues ‘brand’) have publically thrown in the towel over guaranteed issue in exchange for an individual mandate. Regular readers of the Disease Management Care Blog, however, know this is old news. This issue was examined by the DMCB back in November of 2008. What’s different this time around is that a) guaranteed issue and b) mandates are being mixed up with the c) option of a publicly funded insurer. Reactions seem to range from ‘this is precisely the kind of cudgel we need to bring these obstructionist insurers to the table’ to ‘aha, we have those evil corporate pirates on the run.’

To get to the bottom of this, the DMCB dared tread where few seem to want to go. It actually read the Aetna’s CEO Ron William’s March 24 statement to the US Senate Health, Education, Labor and Pensions Committee. Go ahead, call them obstructionist, evil, the Devil’s Spawn or [gasp, and this is the worst!] for profit, but when health insurers like Aetna speak, we should listen. Aetna, for example, insures 36.5 million persons with $42 billion in assets and a market cap that exceeds $10 billion. There’s no way Congress is going to marginalize these guys by simply passing a law sometime in the next six months.

What does Mr. Williams have to say? Health insurers figured out years ago that their business is no longer about just collecting premiums and paying doctors and hospitals. Their customers are demanding additional value, such as covering medical innovations and technologies, having inclusive provider networks, promoting transparency and offering chronic disease care, wellness and prevention programs. Examples include Aetna’s $1.8 billion investments in Active Health management and their Care Engine. And while the uninsured are a pressing problem, remember employers are successfully supporting health insurance for a whopping 177 million Americans, many of whom appear to be quite happy with the arrangement. The rising cost of their insurance is less a function of companies like Aetna and more a function of the underlying cost of health care. Employers and insurers have been working together on this for years and have had some notable successes in improving healthcare quality, dampening cost trends, increasing consumer choice, promoting transparency and covering wellness and prevention.

And here’s a telling quote.

“An enforceable individual coverage requirement, combined with subsidies and other changes to make coverage affordable, is the best way to ensure that all Americans have continuous access to insurance coverage and high-quality health care. Since 2005, we at Aetna have been speaking out in support of an individual coverage requirement, as we believe it is the critical step for achieving universal coverage.” (year bolded by the DMCB)

So what is the link to the public plan? If there is guaranteed issue and an individual mandate, Mr. Williams suggests a public plan option would be unnecessary. He may or may not have a point about that, but he then raises a critically important issue that has conveniently gone unmentioned by the anti-insurer cognoscenti.

A public plan would probably set provider payment rates akin to those used in Medicare and Medicaid. That’s because the government has the leverage to squeeze low pricing from providers. That in turn would force the providers to engage in even more cost shifting (estimated to already be as high as $88 billion nationwide) from the public insurance plans to the private insurance plans.

There you have it. The private insurers don't fear a public plan would be more honest, just, quality driven, administratively efficient, cost effective or consumer friendly. They think a public plan will simply build on its long history of what amounts to government supported 'heads I win' (non-negotiable fee schedules), 'tails you lose' (hospitals and doctors will make up for it in the private sector) predatory pricing. That's not keeping the private insurer's honest, that's crushing them.

The DMCB has a lot of admiration for care management programs, agile use of information technology, prevention, wellness, consumerism, novel insurance benefit designs, pay-for-performance, the medical home and the electronic record, but NONE of that will help private insurers - even with billions in the bank - compete against that kind of dynamic.

Or maybe that's the intention?

What Do Professional Wrestling and Political Wrangling Over Health Insurance Have in Common?

Check out this January 21 editorial from The Hill. Apparently, while the Obama administration is playing nicey nice with all the stakeholders in his various initiatives, one group that has been left out in the cold are the health insurers. According to the editors, President Obama et al are getting ready to spill some blood. Woo hoo!

Don’t be fooled. The Disease Management Care Blog knows that health insurers are inured to being the bad guy when it comes to blame games. While the public face of health insurance is a curious mix of ‘We Care!’ platitudes and ‘You Don’t Love Me?’ dismay at public hearings and in press releases, they have a) been getting pseudo-beat up for decades and b) are continuing to use back communication channels to have very meaningful and constructive dialogues with the politicians, policymakers and regulators. While things may certainly 'change,' the likelihood of a wholesale disembowelment of the insurers is remote. They know their job is to reconcile what doctors and patients want with what the premium will cover while maintaining reserves and a surplus that are tightly - and I mean tightly - controlled by State regulators. They'll continue to do that while contributing to the shape of coming health reform...quietly.

This is more akin to the faux professional wrestling than bloody cage fighting. Every time a politician rails against those loathsome insurers, think Hulk Hogan throwing a fake forearm at the Undertaker while stomping on the mat to make a big noise. Once they’re on the bus heading to the next show, they’re sharing drinks.

Cheers!

Individual Purchasing of Health Care and Affordability?

The Disease Management Care Blog is shocked, SHOCKED that the Commonwealth Fund has determined that Obama bests McCain’s healthcare proposals for a high performing healthcare system. But seriously folks, the DMCB detected little concern over the dueling $1.6 versus $1.3 trillion ten year price tags. As the DMCB understands it, both mind boggling sums represent foregone taxes (in terms of breaks) and/or direct outlays. What goes decidedly unaddressed is the multi-headed Hydra monster of healthcare cost inflation. How about an affordable healthcare system? Where’s that web site of that think tank?

And it’s not just because the contrarian DMCB admits to palling around with hairstylists from the 60's. Despite a growing appetite for Governmental Oversight, Regulation and Financing Of All Things, there may be there something to be said for inserting personal judgment in the healthcare purchasing dynamic. Letting tax-sheltered individual human beings instead of tax-sheltered corporate human resources confront the runaway pricing of insurance is an arguably credible approach to cost containment that is going largely unmentioned. While the DMCB has its doubts, the approach may deserve more credit from the Commonwealth Fund, print media, disdainful blogs and more (Oct 3) blogs.

When It Comes to the Pharmacy Benefit, You Get What You Pay For: An Examination of Dr. Brewer's Wall Street Journal Editorial

Did you know the Disease Management Care Blog was a former Medical Director in a not-for-profit HMO? In that role, it often got to experience first hand the ‘other side of the story’ when a physician ordered a drug that was subject to utilization review.

To read Dr Brewer’s side of the story, he is being unjustly second guessed by a faceless health insurance company more interested in saving $120 per month than doing right by his long-term patient. He argues these hassles lead to the unecessary use of his and his office staff’s precious time. This is wrecking his margins and ability to accommodate more patients.

While the DMCB sympathizes with Dr. Brewer, here are some inconvenient facts:

Medical Directors in most health plans have the ability to approve tests, procedures and drugs on the spot and to do it quickly – literally with the stroke of a key. The DMCB would venture to guess that 99% of Medical Directors, when presented with the facts in Dr. Brewer’s article, would approve the drug. Dr. Brewer’s travails, while vexing, are the exception and not the rule for most health plans most of the time.

Managed care review of drugs like Celebrex are based on same decision support tools that populate electronic health records. Ironic, hm?

Pharmacy programs that use utilization review (UR) cost less per month than pharmacy programs that don’t. That's because they work. Whoever was buying his patient’s Celebrex-needing insurance benefit probably had the choice of purchasing the more expensive option and did not - despite the physicians' discomfort. That’s because they are less affordable. That means pharmacy programs that have UR are cheaper and more affordable and more accessible.

While the DMCB would probably trust Dr. Brewer, it has had reason to not trust many of Dr. Brewer’s colleagues, who like to prescribe potentially dangerous drugs like Celebrex when a cheaper substitute has been shown to work just as well. That speaks to the fiduciary responsibility of health insurers, which they take very seriously.

It is precisely the angst of physicians like Dr. Brewer and their patients that has caused many insurers to retreat to a tiered benefit design. More expensive drugs like Celebrex can be liberated from the tyranny of UR by a Faustian bargain: hooking them up to higher out-of-pocket cost for individual consumer who really needs drugs like Celebrex.

Finally, the DMCB asks readers to ask why drugs like Celebrex cost $120 per month and if it’s the health insurers’ fault.

No Requiem for Disease Management

In the August 2008 issue of Managed Care, Blain Bos, Mercer’s ‘chief strategist for health reform,’ is interviewed about emerging trends in health plan benefit designs. Interesting article and worth a look, but there was one quote about the business community’s perception of disease management caught the attention of the Disease Management Care Blog:

‘Disease management has been embraced, and there is general agreement that it is having a positive impact on the healthy and well being of people who have chronic conditions. The questions now are: How can we measure that to be sure we are getting the best return on investment.’

The DMCB thinks this is one other indication that the ‘disease management’ phenomenon is not going to dissipate. Embraced means they’re not letting go. The name may evolve (‘population health improvement’) but the underlying concept has become a fixture in the medical landscape, along with managed care, the NCQA and physician networks. This upstart industry is maturing and is becoming part of the fabric of employer sponsored U.S. healthcare.

And what exactly is that ‘concept’ you ask? Well, even if you didn’t, and, without relying on the usual formula of a list of specific ingredients, the DMCB suggests the following definition (with explanatory notes) meets the marketplace definition of disease management:

‘Any health insurer (can be commercial or a self-insured employer) sponsored (i.e., paid for) package (there is no single silver bullet) of interlocking communication activities (depending on local market conditions, vary from setting to setting) relying on principles that include (and are not limited to) industrial psychology, marketing and consumerism that are designed to a) maximize self care and b) mitigate insurance risk (usually within one fiscal year) for populations defined by the presence of a chronic condition.

A less technical definition may be:

Any package of consumer-focused education activities that help health insurance enrollees with lifelong diseases take better care of themselves and save money.

Note that the definition depends on the insurance concept of 'risk transfer.' The DMCB believes that is generally outside the bailiwick of mainstream clinical medicine (unless my physician colleagues want to get back into taking global cap) and is one of the features that distinguishes it from the Patient Centered Medical Home. This brings up the second point about the definition: while the defintion doesn’t explicitly mention physicians, they are a necessary but insufficient ingredient in the ‘activities’ mentioned above. Furthermore, risk ‘mitigation’ doesn’t necessarily mean ‘has a positive return on investment.’ It means reduce the risk of a loss and increase the chance of money being left over at the end of the year. Last but not least, it makes no apology for inclusion of the ‘fiscal year,’ because that is how insurance, business, budgets and health care are financed in general.

The DMCB believes the employers and their insurers are using a working definition of disease management based on much of the above when they’re thinking about chronic illness. It’s relatively simple and builds on the notion that patient education translates into savings: it’s common sense. Combined with over 10 years of experience, no wonder the business community, according to Mr. Bos, isn’t asking ‘if’ disease management works, but ‘how’ to best measure it and use those measures to extract maximum value.

Despite What You Think, Health Insurers Are NOT Opposed to Reform

Even persons with a passing familiarity with Shakespeare will recognize the famous quote taken from the speech of the usurer Shylock in which he asks ‘If you prick us, do we not bleed?’ The May/June issue of Health Affairs article by Bruce Bodaken, Chair and CEO of California Blue Shield reminded the Disease Management Care Blog of the hapless reviled money lender, who has the letter of contract law on his side but still struggles to gain much respect or sympathy.

M. Bodaken's central theme is that, contrary to conventional wisdom, the health insurance industry is not, repeat not, opposed to reform. In fact, local insurers were supportive in both Massachusetts’ and California’s efforts (and, by the way, in Pennsylvania). As expected, he notes health insurers are leery about ‘big bang’ proposals (versus incremental change) and mandates (versus flexible participation). However, there are “pockets of support in the industry” for even the far reaching liberal reforms.

How to maximize insurance industry support come January 20, 2009 when the next President assumes office? Mr Bodaken offers a common sensical six point guide which is summarized below

Respect the economics – financial viability is important.

Embrace competition – level the playing field and emphasize quality, service and cost effectiveness.

Manage the transition – don’t just pass a law and assume the job is done.

Respect the insurers’ expertise – market dynamics, actuarial expertise and strategy are not the exclusive province of lawmakers and policy makers.

Share the responsibility – everyone will need to sacrifice something

Stop demonizing health plans – it’s not the insurers’ fault.

But the DMCB couldn't help itself. With apologies to The Bard. From Act III Scene I:

Hath not a health plan premium income? Hath not a health plan cash flow, reserves, surplus, expenses, capital, incurred but not reported; supported with the same FTEs, struggling with the same competition, subject to the same underwriting cycle, criticize'd by the same Boards of Directors, praise'd and criticize'd for the same good and bad quarters as any industry is? If you fine us, do we not end up on the front page? If you demand quality of us, do we not commit considerable resources to disease management? If you sic Michael Moore on us, do we not retrench? And if you wrong us, shall not our PAC support your opponent in the next race? If we are like you in the rest, we will resemble you in that. If a politician extract a mandate, what is his humility? Increased rates. If an insurer stick it to its enrollees, what should his sufferance be by the regulators’ example? Why, increased rates again. The cost inflation you impose on me, I will execute, and it shall go hard but I will better the instruction.

By the way, in yesterday's post, the DMCB made a prediction. Check out its prescience here and here.

And since it is feeling so good about itself, the DMCB would like to point out that it's speaking next week in Washington DC at the World Research Group's '3rd Annual Achieving Return on Investment for Wellness.' Check it out - it should be an interesting conference.