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First “Official” Report on Medicare Health Support DM Pilot Finds Virtually No Evidence of Success
I know that I’m sounding like a broken record.
The first “official” results from the Medicare Health Support (MHS) disease management (DM) pilot projects were published last week. While the results are preliminary, there is virtually no evidence of any early success. Here are three key findings from the executive summary of the report:
Although we present a large number of findings in this report, this initial evaluation reflects considerably less than 6 months of active care management. We therefore refrain from drawing any early conclusions with respect to the pilot programs’ impact on quality of care or health outcomes. Although preliminary, three key participation and financial findings emerge that have important policy implications for CMS’s financial reconciliation in Phase I.
First, although the intervention and comparison groups are similar at randomization, our analyses reveal that an unexpected pattern in PBPM differences between intervention and comparison groups emerges between the time of randomization and the start of the MHS pilots. Second, participating beneficiaries tend to be a healthier and less costly subset of the intervention group. Thus, high participation rates will likely be a factor in the ability of the MHSOs to impact their assigned intervention populations. And, third, fees paid to date far exceed any savings produced. The negotiated MHSO monthly fees are a much higher percentage of the comparison groups’ PBPMs than the percentage savings on payments through the first 6-month pilot period. Fees negotiated by the MHSOs with CMS have not been covered by reductions in Medicare expenditures, let alone an additional 5% savings in Medicare payments. Without a substantial reduction in each MHSO’s monthly fee, budget neutrality after the first year is questionable. (emphasis added). RTI International, Report to Congress: Evaluation of Phase I of Medicare Health Support (Formerly Voluntary Chronic Care Improvement) Pilot Program Under Traditional Fee-for-Service Medicare, June 2007
This report comes on the wake of other recent reports about lack of success of DM in Medicare:
- Mathematica Researchers Summarize Disappointing Results Across 4 Medicare DM Demonstrations
- Medicare Chronic Disease Management Direction? It’s Anybody’s Guess
- One More Dark Cloud in the Stormy Skies of Medicare DM
The 47 page RTI International report is not an easy read. Many of the findings are preliminary and equivocal. My colleague Dr. Tom Wilson and I have exchanged several emails over the weekend discussing some of the findings and implications of this report, and we’ve agreed to put our heads together and do a more in-depth commentary. You’ll see this as a separate blog posting later this week.
Meanwhile, I’d like to highlight some of the WRONG and RIGHT conclusions that you could draw from this report and from general lack of success being shown by Medicare DM demonstration/pilot projects:
The WRONG conclusions:
- Medicare was ungrounded in designing its chronic disease management demonstration/pilot projects
- DM in Medicare is a failure.
- Medicare should pack up its bags in experimenting with DM and move on to searching for the “next big thing”.
The RIGHT conclusions
- We should give Medicare a standing ovation for their efforts at experimenting in novel approaches to chronic disease management. Medicare is trying new things. Medicare is innovating. We want to reward this type of initiative, not punish it.
- The need for chronic care management for America’s over age 65 citizens is clearer than ever. The lack of success in Medicare DM projects to date does not lessen the magnitude of the problem — in fact, it only serves to make the problem more widely and clearly understood. The process of experimentation in DM is like Edison’s attempts to invent the light bulb — it took 10,000 tries to get the light bulb right. We’re currently on try # 6,347 in inventing the “right” approach for chronic disease management in Medicare…we need to stay the course and keep at it.
- Medicare does need to go back to the drawing board in rethinking how it is approaching chronic disease management.
- Is short term ROI realistic?
- Is guaranteed savings a realistic expectation for contractors?
- Should Medicare focus on longer-term quality improvements and cost savings?
- Should Medicare focus more on prevention and population health management vs. patients with high-cost, multiple comorbid conditions?
- How can physicians and other care providers be more deeply integrated into chronic disease management processes?
I’ve been invited to address these questions and related issues in an upcoming industry teleconference in August; my co-presenter will be Chris Selecky, Chair of Lifemasters and former President of the Disease Management Association of America….more details when available.
Your thoughts?
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Obviously, a concern with the Medicare demonstration projects is that they have not shown ROI within the first reporting period. Given that patients with chronic illnesses have taken decades to get to this point, the lack of ROI is not surprising. However, this may also show the need to take a coordinated approach to medical management, rather than parsing out selected diseases to different vendors without coordination with medical / utilization / care management. Lack of coordination is a problem with medical practice (witness the Advanced Medical Home demonstration), so it would not be surprising if we see similar problems within these demonstrations.
Oscar Wilde once said, “A cynic is a man who knows the price of everything and the value of nothing.” We must be careful to avoid a cynical approach to
the MHS pilots, where only the costs, not the benefits or overall value of these important experiments are thoughtfully evaluated and considered.
The conventional wisdom is that we have a cost crisis in healthcare today; others have rebutted that there is nothing intrinsically wrong with a country spending 16% or 20% or more of it’s GDP on healthcare if it chooses, assuming it values the results of those expenditure very highly relative to the
alternatives. (For now let’s skip the interesting question of how voluntary is our “choice” to spend this amount on healthcare.) However, what is nearly
universally agreed by policy wonks and pundits alike is that we don’t derive sufficient value from our current healthcare investments to merit the
current level of expenditure, much less an even greater amount of GDP. We need improved healthcare value for money, so we should work to improve the
quality outcomes we get for the same expenditure, pay less for the current level of quality, or some combination of both.
The initial report to Congress on the MHS pilots is careful to caveat its findings with cautions about the very limited duration of program impact for
this first 6 month period of observation. Nonetheless, the report contains speculative conclusions that focus much more on the “price of everything” than on its value. Of course, it is too early to evaluate health outcomes at this stage and the MHSO contracts do have highly publicized financial targets
that are not yet being met, as expected. Still, one wonders if the evaluators, CMS staff, Administration officials, or the general public will pay sufficient heed to the value equation when those clinical and financial outcomes are more mature.
It’s very premature to get cynical about the potential impact of disease management on the health and economics of Medicare beneficiaries, based on the
limited information available from the MHS pilots. Getting better value for our healthcare expenditures is what these pilots should be all about. Let’s
hope that CMS is guided by this perspective with various R&D initiatives in the area of disease and care management for seniors. These chronically ill beneficiaries certainly deserve no less, and th same could be said for all of us who pay for healthcare.
Joel, as a general principle you’re right — it’s questionnable whether you can expect short term results given that “patients with chronic illnesses have taken decades to get to this point.”
But, aren’t there areas where we’d expect SOME short term gains? For example, there have been dozens of studies documenting the ability of preventing readmissions for heart failure patients. If MHS was going to be successful, wouldn’t we expect to see short term gains here? ….yet we don’t (see p. 41 of the RTI report).
Gordoon, as always thanks for your well reasoned points.
However, I’m missing the punchline,i.e., the implications of your statments. Can you elaborate on your point “Still, one wonders if the evaluators, CMS staff, Administration officials, or the general public will pay sufficient heed to the value equation when those clinical and financial outcomes are more mature. “
Are you suggesting that we “stay the course”? if so, does that mean staying the course with MHS specifically or staying the course in looking for solutions for Medicare’s broader chronic care challenges?
I apologize for being unclear about my punchline – it is that CMS and the industry need to be looking for the baby in the murky bathwater called MHS, rather than reflexly declaring the bathtub empty as soon as it becomes apparent that 5% savings target are not being met. I sense a reflex to declare victory or defeat over financial savings predominantly, rather than digging into the outcomes to understand what works and what doesn’t, who benefited and why and who didn’t and why not, how should the population be stratified in future pilots, etc.
At the end of the day, if it turns out that few conventional medical interventions match the cost-effectiveness of DM interventions (in terms $ per QALYs) yet we reject the value of DM because it failed to meet negotiated yet arbitrary savings target for these pilots, it will be a shame. Yes, let’s stay the course on MHS until we understand all the outcomes and drivers, while also exploring other approaches to improving the value of healthcare for Medicare.
Improving value in healthcare (where Value = Quality/Cost) is no small feat; perhaps the best that DM can do for this frail population is to improve health and QOL in a cost effective fashion. That would be a disappointment for many, but should not be interpreted as a failure in the larger context.
mco’s developed disease management to reduce the level of healthcare services provided to the unfortunate people who have their insurance plans
does it work for them? they say it does? they have convinced their employer customers it does
dm gets a trial from the super friendly bush admin and republican congress with a low expectations program
they did not deliver what they said they could do, in a program environment favorable to them
dm is a good idea
maybe the champions of dm ought to focus on health outcomes
maybe the champions of dm ought to think about their model and stop relying on the “direct marketing tactics” of their call center strategy
I looks to me that MHS was done by bringing a successful model in one population to another population with different needs, without fundamentally and theoretically addressing where could be the cost saving potentials.
All of us know population of age above 75 with multiple chronic conditions is difficult to manage, not only due to their complex medical needs but also due to their reluctance and inability to adapt new lifestyle.
Among this population, would the biggest saving come from 1) lifestyle education, 2) emergency risk triage, 3) medication management, 4) elimination of unnecessary treatment, or 5) avoidance of institutionalized care?
Asako, You are correct — the Medicare Health Support model was essentialy “imported” from the business model being used with commercial health plans back in 2002. See http://content.healthaffairs.org/cgi/content/abstract/hlthaff.w3.342v1 .
DM is theoretically wonderful, but far too early for the tools we have. Tools for finding the patients are far too clumsy; when we find the members needing our DM, our interventions are far too imprecise; the members are not too impressed by what we offer them so they do not adhere; and their doctors continue to sabotage this effort because they feel excluded. The doctors are not asked to participate seriously, as a partner; finally, no information is shared. So, surprised it does not work, yet? What really surprises me is how vendors continue to sell DM and Plans continue to buy it.I guess the consumer pays for it in higher premiums since I have not seen a premium go down in years. If we as members, stop accepting premium increases, would DM be one of those jettisoned early?
Two points.
1. As a physician who practiced the first 20 years I feel justified to point out, if physicians practiced evidenced based medicine, using information systems that allowed good quality of care management there would never be a reason for any Disease Management vendor. Shouldn’t a person’s personal physician be the primary entity responsible for disease management? Let’s put some of this energy into fixing the system where it should be fixed–at the physician/patient interaction.
Second: Measuring a financial ROI is just the wrong measurement. I would much prefer a comparison of average medical/Rx PMPM costs, neutralized for age/sex/demographics/and benefit design between populations involved in DM and comparable populations NOT invovled in DM. If a neutralized PMPM is beating medical trend for the managed population and all the “plausibility factors” are moving in the right direction, then it can be assummed that a real VOI, or Value On Investment is taking place as a result of disease management activities. Our firm does this regularily to show why DM is not only the right thing to do, but how a well run program improves the health status of a population. Measurement people (like myself) have to focus on utilization, quality of care AND financial measurements to show real value–not just ROI. Medicare should do the same.
Dr. Rearick
Hopefully some of the Federal officials read “Enhancing Primary Care of Elderly People” by F Ellen Netting (Editor), Frank G Williams (Editor), Routledge, 1998-12-01 ISBN-13: 9780815325321 ISBN: 0815325320
It describes ten large experiments conducted in enhanced primary care, case coordination and disease management for frails elders conducted in the 1990s.
One of the findings was that financial payback occurred in two or three years, but not sooner.
Another conclusion was that frail elders are – for the most part – on a one way declining slope. On average the rate of decline can be reduced, but cannot be reversed.
Who would have guessed–that end stage chronic disease is difficult to manage let alone show a positive ROI. If we did everything only becaue it provided a return on our investment the world would be a sorry place. I have always been a proponent that it is “Doing the right thing” to manage a disease (whether in the commercial or Medicare population). Hopefully, most other physicians consider it also the right thing. Sometimes doing the right thing comes with a cost (not a return on investment). Can you imagine a world where we didn’t try to manage disease unless it was profitable? Was that what Don McClean was singing about in American Pie?
Dr.Rearick
Dr. Rearick is correct, of course. The early history of DM is that doing proactive care mgt. for vulnerable populations with high avoidable utilization was noted in most cases to save money (in addition to improving quality of life, functional status, satisfaction with care, and in some cases, mortality). Those outcomes are still seen in CMS DM pilots/demos yet the focus has shifted so fully to short-term financial results that other meaningful outcomes are eclipsed by lack of compelling savings so far. If the emphasis were redirected at “doing the right thing” most cost-effectively, the CMS verdict on DM would be substantially revised, if not reversed.
The dm model needs to be integrated with the care delivery system. Most programs have nurse call centers that are protective of their turfs and lack do not share incentives with pharmacists, physicians and the rest of those involved in treatment. Also, these programs are costly so it is not surprising that there isn’t a good ROI.
Why do I need DM? I am elderly and I understand the meaning:
Disease management uses clinical teams, that continuously analyze relevant data, and cost-effective technology to improve the health outcomes of patients with specific diseases. The include self-care management techniques, patient education, and provider training. Disease management provides individualized care plans based on clinical guidelines to manage individuals with treatable chronic diseases.
When you are elderly you’re not getting better, you are own your way out of this world. Why spend all this extra money, let my family Dr. whom I’m comfortable with handle things, and spend the money on the young.
Medicare should: maintain cost effective service w/o guaratee.Probably one of the historically most inflationary forces in health care has been the ability of providers of service to have there price met. Medicare should focus, clearly on prevention/management. The aging population is bringing three major epidemics into majority and all the resultant complications. They are obesity, alcoholism and sedintary existence.