August 12, 2000
NEXT STEPS TAKEN
IN MEDICARE COORDINATED CARE DEMONSTRATION
Medicare is testing the
cost-effectiveness of paying for case management and disease
management (DM) services. The latest announcement from the
Care Demonstration describes plans to select at least eight
demonstration projects by early 2001.
The demonstration is designed to:
Test proven models of coordinated
care to improve the quality of services furnished to specific
beneficiaries and manage expenditures under Parts A and B of the
Examine a variety of delivery and
payment models applicable to the original Medicare fee-for-service
Assess the cost-effectiveness of
making a monthly payment for coordinated care services; and
Test whether models of coordinated
care improve clinical outcomes, satisfaction, quality of life, and
appropriate use of Medicare-covered services.
The Health Care Financing
Administration (HCFA) is continuing with its methodical approach to
evaluate and incentivize disease management and care coordination
approaches. HCFA continues to signal that over time it will adopt
payment mechanisms that will encourage DM and case management in its
Medicare fee-for-service program.
Over time, this demonstration
promises to eliminate two of the most significant objections to DM
Objection by hospitals and
physicians: "We have to pay attention to what we get paid to do by
Medicare. Today we get reimbursed for patient admissions, visits,
and procedures. We do not get reimbursed for providing DM
Objection by the health plan Chief
Financial Officer: "If we get too good at DM, we'll just attract
more high cost and high risk patients. We should not invest in DM
E-HEALTHCARE STRATEGIES FOR CHRONIC DISEASE MANAGEMENT
If you have been wondering how the
Internet and E-Care will change the future of disease management and
patient care, sign up for
The Symposium on E-Healthcare Strategies for Chronic Disease
Management. This one of a kind program will feature the best and
the brightest in the E-Care space. It will be held at the popular
Desert Springs Resort in Palm Springs on September 17-19th. The
Disease Management Association of America is also sponsoring a golf
tournament on Sunday, September 17th. Additional details and
registration information are available at 1-800-684-4549.
POPULATION HEALTH MANAGEMENT--ACHIEVING IMPROVED PATIENT OUTCOMES
AND NEAR-TERM FINANCIAL RESULTS"
The July 2000 issue of the American
Journal of Managed Care contains a superb article examining an
intervention approach developed and implemented by
StatusOne. The program
was designed to anticipate and care for the most frail and least
stable members of a health plan.
The study found that a sharply
focused, Internet-deployed case management strategy achieved
economic and functional status results on a population basis and
produced system wide savings in its first year of implementation.
Concentrating on the highest-risk
group, which averaged just 1.1% prevalence in the total membership,
yielded bottom line results. During the program's first year, the
total population's annualized commercial admission rate was reduced
5.3%; seniors' was reduced 3.0%. Among just the highest-risk group,
costs dropped 35.7% from preprogram levels of $2,590 per member per
month (excluding drugs). Patient-derived cross-sectional functional
status rose 12.5%.
Can't find your copy of the latest
AJMC? A copy of the study is available from one of its co-authors,
Sam Forman, MD. Write to email@example.com for a Word version or
a reprint of the AJMC article. Include your mailing address for a
AND NOW FOR
SOMETHING COMPLETELY DIFFERENT....
eGerminator.com and The Corporate
Partnering Institute have formed a joint venture to develop a series
of disease and condition management web sites. Their new company --
DiseaseRx.com -- is organizing a launch of 141
direct-to-consumer, disease-specific web sites.
Today there are fewer than 10
diseases which account for almost all the focus of DM efforts.
DiseaseRx.com is evidence of how the Internet is greatly expanding
opportunities FOR PATIENTS to manage a BROADER RANGE of diseases and
HEALTH CARE COSTS FOR 2001
A Washington Business Group on
Health/Watson Wyatt Worldwide Survey was designed to capture an
early picture of how health care costs are shaping up for the year
Some key findings:
Overall medical costs are expected
to increase an average of 12.2% for active employees
The cost increases for
prescription drug benefits are most dramatic, with employers
reporting an average increase of 22.5%
The fact that costs are rising at
similar rates under all forms of health care delivery highlights
the continued difficulties in managing health care cost and
Highest priority actions to
"In the next 12 months, what actions
do you anticipate taking to manage health care costs?" (Answers
reflect the combined percentage answering "likely" or "somewhat
Employee education through the
Partner with providers.............................69%
Defined contribution approach................. 31%
BEHALF OF OVER 100 MILLION AMERICANS, ...."
Any time that 22 health plans
representing 100+ million Americans can speak with one voice, it
gets our attention. The Coalition for Affordable Health Quality (CAQH)
has issued its first
The CAQH members have agreed upon
specific action steps in the following areas:
1) Access to Quality Care
2) Simplifying Administration
3) Working With Physicians
A common thread among the action
steps is that they are focused on simplifying and standardizing
administrative and clinical processes across health plans. The steps
address complaints commonly heard from patients and physicians that
"every plan has its own way of doing things."
One action step relates specifically to disease/care management
"Plans will select care management
areas to develop common best practices across health plans in
collaboration with physician organizations. These best practices in
care management also will be used as the basis for patient education
materials regarding best practices to empower patients to take steps
to improve their health outcomes. Preventive health measures,
treatment of specific conditions such as asthma, diabetes, and
post-MI care, and proper use of prescription drugs are examples of
topics that will be addressed."
STUDY SHOWS ONLINE
HEALTH INSURANCE MAY OFFER SIGNIFICANT BENEFITS FOR SMALL BUSINESSES
study sponsored by the California HealthCare Foundation and
conducted by the Health Privacy Project at Georgetown University
examined the question: "If the Internet can prove so useful for
relatively simple purchases such as books and toys, how useful could
it become in the purchase of something as vital and complex as
health insurance?" The study evaluated three health insurance web
sites -- eHealthInsurance.com, Healthaxis.com, and Quotesmith.com.
The study concludes that online
health insurance sites have considerable potential to influence how
the market for health insurance functions:
Online evaluation tools could
greatly increase the ease with which consumers learn about and
compare health insurance options.
Online, real-time quotes and
enrollment could greatly reduce the time it takes consumers to
shop for and purchase health insurance.
Easier access to information could
result in greater participation in the market.
As actual transaction costs
decline, pressure to reduce broker commissions or restructure the
broker's role may increase.
Commentary: As discussed in the
2000 issue of ECMN, the ehealthinsurance sector is moving
extremely rapidly (at least 32 companies are involved today). This
study was conducted in February-March 2000, eons ago in Internet
LATER....INTEGRATED DELIVERY SYSTEMS DON'T WORK
After spending nearly $5 billion in
hospital integration activities to include physician integration,
insurance integration and horizontal integration, 31 major
healthcare organizations nationwide concluded in
independent survey that the benefits from these expenditures are
limited and that their future integration of medical healthcare
activities would be significantly reduced.
One implication: don't expect many
hospitals to champion DM programs.
In the 1990s many hospitals attempted to transform themselves into
integrated delivery systems (IDSs). This was done to prepare for an
envisioned tidal wave of capitated reimbursement mechanisms, but the
tidal wave never came.
A few pioneer IDSs attempted to
become leaders in DM programs in their communities. This latest
study pronouncing the failure of hospital integration activities
leaves hospitals with minimal financial incentives to be active in
E-CareManagement News is an
e-newsletter that tracks a major change in health care and managed
care—the paradigm shift from “managing cost” to “managing care”.
This e-newsletter is brought to you by Better Health Technologies,
LLC (http://www.bhtinfo.com). BHT provides consulting and
business development services relating to disease management, demand
management, and patient health information technologies.
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