Use Enterprise Risk Management in Your Dealings with the Feds: A Lesson From LifeMasters

The Disease Management Care Blog has been thinking some more about the LifeMasters bankruptcy debacle.

There will be some additional fall out but in the meantime the the DMCB thinks there are some important lessons for the future:

The Government Can Be a Fickle Business Partner: One classic example is the Medicare Advantage (and let's not forget Medicare+Choice) program. Like it or not, that Federal program has been a roller coaster of commitments made and unmade. While you may not feel sorry for the contracting insurers, there's still something unfair about midstream and unilateral funding cuts ultimately based on shifting politics and budget shortfalls. It's a heluva way for a government to treat its citizens, especially when it comes to insurance.

And now we have LifeMasters. As the DMCB understands it, the disease management organizations (DMOs) that participated in the Medicare Health Support (MHS) Demo are dealing with the specter of having to remit their fees minus the savings back to CMS. The DMCB hasn't been privvy to the contracting terms, but it suspects there is room for interpretation and negotiating. The fact that one of the DMOs had to resort to bankruptcy suggests that the flexible, mutually beneficial, inquiry-driven partnerships that have characterized the MHS pilot has been replaced by lawyering. How much of the government’s hardball interpretation of the pilot's terms is a function of the CMS’ legitimate fiduciary responsibility versus a change in President, the lack of a strong full time CMS administrator and budget shortfall? Are the other DMOs involved in the MHS pilot going to have to litigate their way out of this?

Beware Rosy Actuarial Projections: The DMCB remembers those heady days back in the 1990s when those of us in traditional disease management thought we could conquer the world. While there were some preliminary studies that suggested increased quality and lower costs, our enthusiasm made us generalize preliminary findings involving an underdeveloped uni-dimensional care approach to any population in any setting. The fact that we were so naïve is OK, but let's face it. The calcuations underlying CMS' and LifeMaster’s assumptions on the fees and savings were about as accurate as all the other predictions about Medicare costs. It won’t be the last time.

There is a relatively new and admittedly imperfect business tool called 'enterprise risk management.' The DMCB suggests sponsors of the Patient Centered Medical Home (PCMH) and Accountable Care Organizations (ACOs) and Co-Ops that are so anxious to do business with the Feds aggresively use their ERM to pause and think really long and really hard about all the worse case scenarios that could happen when getting into the projected savings business with CMS. Think hard about changes in the administration, funding levels, the tax code, insurance support, costs vs. upside risk, data availability, shifting regulators and the threat of litigation. It's not only good corporate governance, but when it comes to the goverment, it may be all that stands between you and bankruptcy.

LifeMasters Declares Bankruptcy

You can read one of the typical press releases here. Rather than battle the Feds over who owes what to who for its star-crossed foray into accepting risk (i.e., the claw back of fees that were unmatched by savings) in Medicare Health Support, privately held LifeMasters is seeking the safe harbor of bankruptcy protection.

The BEST summary can be found at Vince Kuraitis' excellently written review of the history, the balance sheets and all that is known and unknown over at e-CareManagement.

LifeMasters & Tailoring Disease Management to Degree of Patient Activation. A Summary & a Good Example of How "Applied" Real World Research Can Work

Check out this study appearing in the American Journal of Managed Care by Judith Hibbard, Jessica Green and Martin Tusler. In it, LifeMasters tested the use of a 'Patient Activation Measure' (PAM) by nurses on call duration, the usual clinical measures (A1c, blood pressure, LDL cholesterol, flu shots, aspirin, statins, beta blockers and ACE use) as well as admissions, emergency room visits and outpatient office visits.

Two separate LifeMasters call centers were involved. Both administered the 13 item PAM survey that was designed to assess patient 'activiation,' on a 1-4 scale. The Disease Management Care Blog thinks of this as interest and willingness to participate in their own health care, where 1 is low (think of Bea Wilderd who works in the Finance Office downstairs and is baffled by the thought of actually finding out how all those pills work) and 4 is high (think Chip Ind, the IT guy upstairs who 'bings' the name of his pills to be on the look out for side effects). Both centers telephoned patients with chronic illness on behalf of payers to 'coach' behaviors designed to increase quality and lower cost. The difference was that the nurses in one center were specifically trained on how to tailor their messaging according to the PAM, while the nurses in the other center acted as a control.

The analysis was done at the University of Oregon and "Decision Research," also located in Oregon. It appears the PAM survey is owned and/or marketed by an entity called 'Insignia Health.' One author has investments in that company, and another author has been a paid consultant.

There was a one year baseline period and six months of follow-up. The study was hobbled by considerable amounts of drop outs, spotty access to insurance claims data and ad hoc additions of patient data to serve as controls. Ultimately, the two comparison groups seemed similar enough at baseline and, after statistical adjustments, there were greater changes in in the 'PAM" patients in all the clinical measures listed above with the exception of systolic blood pressure and A1c (which were reported in weird units that ranged from "692.3" to "764.6." Perhaps they meant 6.9 or 7.6?). What's more, there were statistically and financially significant reductions in admissions and emergency room use in the "PAM" patients that were extrapolated to a decrease in the per member per month (PMPM) of $145 and $11, respectively. PAM seemed to be responsible because nurse call times shifted: Bea (Level 1) spent more time on the phone if she was with a PAM-trained nurse vs. a control nurse.

The DMCB congratulates LifeMasters at several levels. Yes, this is another study demonstrating the benefit of remote patient coaching and there appears to be something to this 'PAM' approach to telephony. But what the DMCB likes most of all is LifeMasters' ability to simultaneously run a business and perform studies that not only serve their investors' and customers interests but to perform those studies with a sufficient degree of rigor that is good enough to pass muster with peer review and make it to the public domain. This is not a perfect study and, with admirable but necessary honesty, the authors point out the various weaknesses of their study design in the manucript. That being said, the DMCB (and plenty of others for example) has found that perfect studies often don't answer questions that address real world needs. Read the traditional big name medical journals and you are guaranteed to learn a lot about a little. Read studies like this about PAM and you often learn enough about a lot.

Anxious customers may tut-tut that they shouldn't pay for the direct and indirect costs of a PAM trial. Actually, they probably didn't. Pointy headed Chief Financial Officers may tut-tut that their business model shouldn't support research. Actually, that's only bulls***: a) without innovation, the industry will die and b) the Feds' granting agencies and the academic community have no idea how to perform this kind of inquiry. The DMCB speculates that customers and CFOs can find comfort in knowing that LifeMasters was unable to train all nurses in all call centers at once over the use of PAM. Since the roll-out had to be one center at a time, this gave them a perfect opportunity to perform a 'quasi-experimental' study because a 'control' comparator group was readily available. This study is a role model for all sectors of health care.

Limitations? the DMCB may be all wet, but wonders about two issues not mentioned in the manuscript.

While 'propensity matching' was used to compare and statistically adjust the two groups of patients, it's not clear from the manuscript if the propensity score included some assessment of hospitalization risk. The DMCB is concerned about this because the control group hospitalization rate went from ".04" hospitalizations per month to ".04" (ie, no change) while the intervention or PAM group went from ".06" to ".04" hospitalizations per month. Did the intervention group start out with a higher baseline and simply fall to level of the control group, or did they really do better?

The DMCB was also confused by blinding. If the nurses in both centers knew they were being compared in a study, the Hawthorne effect may have played a role in the behavior of the nurses, not PAM training.

And a small insight: want to know how much time a typical disease management nurse spends on the phone with patients in a commerical setting? According to this paper, 16-18 minutes.

Last but not least, while the PAM nurses beat the control group nurses, this was not a study comparing a superiorly tailored disease management program vs. usual care. This was one type of disease management versus another type of disease management. We are no closer to answering that Big Burning Question: does disease management work? If you read the press release, it's clear that LifeMasters believes this gives them a leg up versus their DM competition, not a reason for Federal health reform to include disease management.

For LifeMasters, Nothing Succeeds Like Success.

Here’s an update to a prior post about LifeMasters’ ongoing telephonically-based 11 county Florida disease management pilot program for dually eligible Medicaid beneficiaries with heart failure alone or with coronary artery disease and diabetes. As readers may recall, compared to a control group, there were enough savings to warrant CMS continuing the program. The bottom line intervention vs. control per member per month (PMPM) difference has not been reported yet, but we do know that most of the savings to date appeared to be associated with patients that were successfully engaged by the coach-nurses. As a result, LifeMasters has redoubled its efforts to reach even more patients and enroll enroll enroll. If successful, LifeMasters will deserve credit credit credit and CMS will undoubtedly look to expand the program.

According to a January 29 press release, the push to enroll now includes a ‘Health Network One’ (HN1) physician bounty or a ‘per-member per-month fee for each patient engaged in the program with incremental increases the longer the participant remains in the program.’ HN1 is described here as a Florida company that maintains provider networks for the insurance industry; the Disease Management Care Blog suspects these are private physician practices that rely on HN1 to handle the myriad details behind contracting and credentialing with health insurers. Getting some coin from LifeMasters is one of those details. This is classic win-win: the docs get income and greater buy-in with an otherwise distant vendor, while LifeMasters knows each enrolled patient – thanks to a physician referral - increases the likelihood of success for an already successful program.

The DMCB thinks this is important because of its prediction that disease management, the medical home, pay for performance, insurance benefit design and information technology will continue to evolve to a mutually supportive interlocking Unified Field (or maybe a Teilard de Chardin-esque ‘Omega Point’) of population-based care that collectively make up for the weaknesses of the individual components. We’re already witnessing interest in combined disease management – patient centered medical home approaches, benefit designs that lower barriers to self-care and the use of P4P to support the purchase of EHRs. This is one more example of this trend by a nimble disease management organization taking advantage of the synergies with other population-based care initiatives.

The DMCB suspects the next stage (unless it’s already arrived) will be three-way combinations, such as disease management organizations using P4P to support the medical home or consumer directed health plans that have first dollar coverage of services arranged by medical homes using an electronic record. Then will come 4 and then 5. Interested in knowing which will be the leading disease management vendor in the coming years? One way to do this is look for the program that successfully incorporates all of these concepts.

While LifeMasters and CMS deserve credit, this is ultimately research that is testing an model that is already underway in other settings. That being said, it's clear to most population program architects that, in an open-range, fee-for-service setting, it’s important to get the physicians involved. This is an attractive way to do that, especially if it’s combined with additional IT initiatives like this one and if the physician compensation is tiered and additive. The DMCB knows this because LifeMasters was kind enough to answer an email question about that from the DCMB.

One lingering question remains however: what happens to all that that pay? In an ideal setting, it should be plowed back into the office practice to support even better systems that result in even better performance for even greater pay leading to a virtuous cycle of escalating outcomes. The DMCB suspects that in large salaried physician practices, not all the money makes it to the docs' paychecks. Yet, instead of hiring more personnel or hardware to help garner better performance, the temptation is to use the performance-based revenue for something with an even better ROI - like an ultrasound machine or something. Not that the alternative of diverting all of the money directly to the physicians' pocket is any better. That could happen in an HN1 type of network.

We'll see. In the meantime, the DMCB recommends that disease management programs that get into the P4P arena follow the money.... carefully.

LifeMasters Hits One Out of the Park with Florida Dual Eligibles

While the Disease Management Care Blog was at the Hollywood Florida Forum 08 DMAA meeting, it heard the folks from LifeMasters report on the updated results of a three year randomized (in a ratio of 5:2) clinical trial of opt-out disease management vs. usual care for dually eligible FFS Medicare beneficiaries with heart failure, coronary artery disease and diabetes in eleven counties southern Florida.

By way of background, LifeMasters is a privately held company headquartered in Irvine California. Not too long ago, it stumbled during an attempt at a merger with Healthways. It shuffled its leadership, sought out additional financing, reduced its workforce and decided to stick to disease management.

The Florida program started out in January 2005 with a well defined population with a well defined program of telephonic outreach. As the months progressed, it looked like the program was not going to break even. As a result, LifeMasters changed course. It increased its face-to-face recruitment strategies, dropped four of the counties from the program, changed the combination of chronic illness and comorbidities that qualified for program entry, increased the physician marketing and intensified the remote recruitment efforts.

As a result, recruitment (the number of patients who agreed to participate) and engagement (the number of patients that actually participated in the phone calls) rates went up. Among the persons who were engaged, there was a savings of approximately $700 PMPM vs. persons who had been merely enrolled and vs. the control group patients.

Whoa! you say? The DMCB knows what you’re thinking: that a $700 per member per month (PMPM) savings among the persons that were recruited into the program is a classic example of selection bias. While that’s correct, the analysis reported at the DMAA also included a comparison of the intervention vs. the control groups. The group randomized to the LifeMasters program had lower claims expense compared to the control group; it’s just that the $700 persons who were recruited and engaged ‘dragged down’ the average claims for the entire group, which was otherwise flat. The actual overall savings were not shared at the DMAA meeting (pending release by CMS), but Ms. Selecky’s grin and CMS' decision to extend the program spoke volumes about the results.

The message was that once persons with chronic illness are enrolled, savings are achieved. The fix is to launch disease management programs and enroll, enroll, enroll.

Norwegians, Depression and Lifemasters' New Depression Program

Yes, that is a disturbing painting, isn’t it? 'Madonna' is by the Disease Management Care Blog’s fellow Norseman Edvard Munch, who is probably best known for his infamous 'The Scream' (or ‘Skrik,’ better translated as Shriek). Based on these and his other artworks, the DMCB suspects Edvard was not a very happy person. In fact, art historians have pointed to his family history, traumatic childhood, likely alcoholism and recurrent depression as major forces that shaped his artistic genius.

And why not? Edvard was born in Norway, which is rainy, cold and dark for half of the year. In addition to the weather, turn of the century Scandinavian culture is not known for its party animals. Or, maybe there’s something in the water or the genes. So it was with some interest that the DMCB noted LifeMasters’ latest entry into a population that may include some of Edvard’s descendants. We’re talking about Minnesota, the land made famous by widespread disdain for Christopher Columbus, deserved admiration for the stoic Norwegians that inspired Garrison Keillor’s Lake Wobegon and the inexplicable persistence people who still eat lutefisk.

But seriously, suicide rates in Norway are lower compared to other parts of the world and Minnesota’s depression rates are not comparatively high either. The DMCB interprets this to mean that programs that improve the detection and treatment of depression are needed as much in Minnesota as anywhere else. That’s especially true considering how ‘usual medical care’ performs in this area and the considerable literature that supports the use of disease management.

According to the press release, the disease management company LifeMasters has used some newly infused money to build a depression program. One buyer is Preferred One Health Plan in Minnesota. Along with other managed care organizations, Preferred One has case managers that are tasked to depression care in its network. Lifemasters provides the telephonic care.

Interested in learning more, the DMCB contacted Lifemasters. They will also perform claims analyses and predictive modeling to identify Preferred One enrollees at greatest risk. Accordingly, patients will be recruited into the program; patients may also self refer and physicians can also. Depending on clinical need and severity, patients may be followed by the case managers or the Lifemasters nurses. There will also be hand offs, depending on how well the patients are doing. This program is in its earliest phases, just having gone through a pilot phase. There’s no information on Lifemasters’ web site, but ‘more information will be made available in the future.’ As for peer review publications so the DMCB can help its readers assess the impact on outcomes, ‘not yet.’

The DMCB recalls that physicians may chafe over the prospect of their patients being ‘cold’ contacted over a possible condition of depression using claims, pharmacy or other relatively inexact data. Some patients are undoubtedly destined to be upset also. However, depression is prevalent, burdensome, costly as well as treatable. Disease management has a track record of success. 'Nuff said.

Lastly, this is another example of an emerging pattern of collaborative integration of program components that blur the distinction between carve outs, carve ins, managed care, provider networks and disease management.

The DMCB wishes Preferred One and Lifemasters good luck on this. Hopefully we’ll hear more on how this initiative is progressing and how Edvard’s relatives and the rest of the clan are doing.

May 31: In the original post, the title ascribed the new program to Healthways. It's obviously Lifemasters. The DMCB regrets the error.

Lifemasters

Let's see. Real estate? Munis? Treasuries? Rubles?

No... disease management!

LifeMasters News

Update on leadership changes here.