August 12, 1999
SUMMER VACATION ISSUE
CARE MANAGEMENT-- BIG
Here's an excerpt from a recent (July
27) investment analyst report on Internet health opportunities. "The E*Volution of
Healthcare" is published by E*Offering, the investment bank arm of
E*Trade. You can
download the full report, "The Next Generation of Managed
"After nearly a decade of managed
care and its emphasis on cost containment, we believe that the
'low-hanging fruit' has already been picked from the healthcare
system and that HMOs will now need to move toward truly managing
clinical care to reduce costs. In the
industry's initial stage, HMOs reduced
costs by garnering deep discounts from physicians and hospitals in
exchange for steering volumes of patients
way. In addition, they shortened hospital lengths of stay (remember
the furor and government reaction to 'drive-by' C-section
deliveries), restricted access to higher cost specialists, and used
'delay-then-deny' techniques, in our view, to reduce costs. But we
believe that the savings that resulted from these actions were
administrative or cosmetic in nature-not clinical.
healthcare premiums on the rise again..., managed care companies
must demonstrate their value-added beyond exploiting one-time
administrative inefficiencies that account for 10-15% of total
healthcare costs. The real money to be saved is in the area of
patient care costs, which comprise 80-85% of the $1 trillion spent
on healthcare each year. In our view, managed care hasn't even
scraped the surface of this huge market opportunity-but it's about
to. As such, we believe that the industry is poised to enter the
next generation of managed care-clinical management, followed
closely by disease management. In our view, the role that
information technology could play as the managed care industry moves
in this direction is enormous. In fact, we would argue that
information technology holds the key to eliminating clinical
inefficiencies, such as adverse drug reactions and improving patient
care in the healthcare system." (p.11)
ASKING FOR YOUR INPUT
We know there are many experts in care
management among our diverse readership. We're asking for reader
input to an article that's in the works.
working title is "Top 10 List for CMOs: What To Do and NOT To Do in
Sustaining Care Management Initiatives." The Chief Medical Officer (CMO)
is the KEY person in spearheading and driving care management
initiatives. CMOs have
encountered barriers: limitations on budget authority, short term
ROI expectations, inability to obtain needed data, politics, etc. However, we see the tide turning: CEOs are understanding the strategic importance of care
management, pressures to demonstrate improvements in
clinical outcomes, Y2K preoccupation
diminishing, the Internet, regulatory compliance, etc. We'd like to highlight
ACTIONS that should be taken by the CMO to start and sustain a
successful care management initiative within a health plan or IDS. What works,
Vince Kuraitis, or call
(208) 395-1197. Thanks.
"THE STATE OF MANAGED
CARE QUALITY 1999"
National Committee for Quality Assurance (NCQA), an accrediting
agency for health plans, has just released a report entitled "The
State of Managed Care Quality 1999."
The study provides information on health plans that
collectively cover 52 million
full report is available.
Some of the key findings:
"Managed care plans that
consistently monitor and report on quality are showing
significant improvements in quality. The differences in
performance ranged from about 3% to more than 12%.
health plans scored between 3% and 16% higher on clinical and
service measures, and these differences have strong public
health significance. As an example, accredited plans reported a
cholesterol screening rate of 62.9%, as opposed to a
of 53.3% in non-accredited plans, and an adolescent immunization
rate of 60%, as opposed to 44% in non-accredited plans. Members
of accredited plans also report higher overall ratings of their
health plans, and better customer service.
"Overall improvements on most measures between 1997 and 1998
were small, but newer measures saw larger - and very meaningful
- improvements. Driving home the message that "what gets
measured gets done," several important and relatively new
measures, including Beta Blocker Treatment after a Heart Attack
Vaccine saw the largest increases. The average reported rate for
Beta Blockers in 1998 rose to 79.9%, from an initial rate of
62.5% in 1996.
"Health plans that score high on clinical quality also have the
most satisfied members.
Members of plans that scored in the top 25% on HEDIS
Effectiveness of Care measures rated their plans higher across
every single measure of satisfaction, access,
customer service and overall performance."
One: Breakthroughs in
High Risk Population Management", by Matt Kelliher, MBA and Samuel
Forman, MD, MPPM, MPH.
"Status One" refers to the sickest 1% of patients (and those at highest risk)
who typically account for 25% of all heath care costs. This inspired book
describes how health care organizations must refocus
care on managing patients--not providers--and partner with patients,
families, and communities.
group of patients offers tremendous opportunity for clinical
improvements AND reduced costs.
Many health plans are understanding the value of focusing on
this small segment of patients.
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.
You may copy, reprint or forward this newsletter to friends,
colleagues or customers, as long as the use is not for resale or
profit and the following copyright notice is included intact.
Copyright © 1999, Better Health Technologies, LLC. All rights