Managing employer sponsored health plans–some good news! January 30, 2012

Looking over my prior postings, I seem to have identified some problems. Now let’s highlight solutions starting with the foundation which should guide every plan decision focused upon “mitigating” risk while sequentially improving quality. Define quality anyway you want! Prevented disease, better disease outcomes, enhanced member wellness behaviors, however better quality, “always on aggregate”, means lower cost! The foundation is ” An independent, HIPAA compliant, patient-centered database. A quick meaning of independent data:Loaded “flat” files from the TPA which are assembled by a data mining company, not associated with the TPA/MCO claims administrator. We don’t want the administrator to put any spin on data reporting. By omitting elements, highlighting others and changing metrics, virtually any recommendation can be validated.

Also, let’s not discuss normative data. Although sometimes useful to compare performance against peers, let’s not go into rear-view mirror data yet. Here’s a 10K foot look of the process to utilize an actionable database! (1) What are our plan problems/precursors to problems? Why? Because they will repeat in the future. (2) What strategies can be implemented to mitigate these problems? (3) After a strategy/s are decided, how are they implemented and (4) How can we measure the results? (5) Repeat

The market is overrun with data vendors purporting the ability to perform as above. Additionally, some of their “dash boards”, or reporting output look beautiful. If you are dealing with a “top” vendor, a major portion of the sales presentation should be focused upon their ability to quickly and completely scrub healthcare data. To say healthcare data is dirty is akin to describing the condition of the worst gas station bathroom in Panama. MCOs grew by mergers of multiple health plans, each with 1980s-1990 based IT legacy systems. Claims paid in Atlanta are merged with member eligibility sourced in Oakland, each data feed pulled by a different MCO employee each month. Recently my data partner described a site visit to and insurance company claim office as comparing our use of the I Phone S4 to their use of tin cans connected by string. One last time, if the database vendor doesn’t describe data scrubbing as their major challenge, run away!

5% of Americans spend 50% of annual health care dollars–how will the Cadillac tax work? January 13, 2012

My firm has had the opportunity to analyze years of medical claims from multiple self-funded employer healthplan sponsors, covering thousands of members. Across employer groups, various industries and  state to state, one metric is virtually identical, the member expense claims distribution. This metric examines the annual plan dollars spent as a percentage of covered plan members. Here’s the common finding:  The top 1% of members account for 25%-30% of annual expenses and the next 4% account for an additional 25%. As recounted in USA Today, the top 5% of Americans spend 50% of all dollars! http://tinyurl.com/7wp9frh

What’s this got to do with the famous Cadillac Tax? The article shows a picture of HHS Sec. Kathleen Sebelius. Not mentioned is the Secretary’s firm stance on the wisdom of the Cadillac tax as a funding vehicle of PPACA. They define a Cadillac plan as containing very rich benefits, better than those enjoyed by average Americans. Starting in 2018 Americans covered under high-cost Cadillac plans will pay substantial taxes for these rich benefits!

Oh–but the article reports just 5% of Americans spend 50% of all dollars, $36,000 each and the top 1% averaging $90,000 of annual medical charges. I bet everyone knows the top 5% suffer from multiple chronic diseases/acute injuries and are suffering. They are not enjoying life compared to the bottom 75% not spending significant dollars. Here’s the issue!

PPACA (ObamaCare) plans on taxes from the Cadillac plans to fund care in the future. What makes plans high-cost? It isn’t what Washington considers a high-cost plans as having low deductibles or low/no co-pays. In reality these “rich gold-plated” plans spend less as their benefits encourage low-cost doctor visits and facilitate the prevention of high-cost disease through the identification of emerging disease at the earliest, low-cost stages. Don’t believe me? Then why are employers slashing health cost by adopting on/near site clinics which employ physicians seeing members for 0 deductibles, no copays and dispensing generic drugs at no member cost? They are preventing disease. The best deal in healthcare is someone living a healthy, disease free life.

The upcoming result of Cadillac plan taxing will confront/afflict groups of older Americans with the sickest populations of members with chronic diseases! Doesn’t seem fair? The 5%-50% fact highlighted by this USA Today report is the most important issue in our national healthcare debate. High cost equals much disease and suffering. If a discussion of healthcare fails to mention chronic disease, the discussion is moot! A famous bank robber was once asked by a reporter, ” Why do you rob banks”? His answer– Fool, because that’s where the money is”.  A meaningful discussion American healthcare inflation, must include chronic disease because that’s where the money is!

“I’d call it a new version of voodoo economics, but I’m afraid that would give witch doctors a bad name.”

Geraldine A. Ferraro

Wellness screenings covered at 100%–read the small print! December 28, 2011

Here’s an egregious practice unfortunately common in the managed care industry. A member, trying to maintain health, participates in a “no cost” wellness procedure. While sedated, or undergoing the procedure, the physician identifies a minor medical issue and fixes it. Then “whack” the member wakes up facing a fat charge due to a diagnostic in place of a screening code.  One could argue it’s a “technical event” allowing insurance companies a manner to collect additional revenue. http://tinyurl.com/7lxz32l

Here’s the work place problem. For example, colon cancer is the 2nd leading cause of cancer death in the US. The main weapon to fight this cancer is early detection by colonoscopy. It’s hard to imagine this procedure being abused by members, recreational colonoscopies? Due to these hidden charges, one has to wonder how many colon cancer deaths result? If a plan is self-funded, the plan managers need to prevent ASO claims payors from implementing these processes. If fully insured, employers should pick up/pay for the additional fees.

Unintended consquences, PPACA eliminating jobs of 100,000+ agents & brokers December 13, 2011

The president’s healthcare bill is showing America “change” has unintended consequences. Here’s one which will ripple through the lives of Americans receiving health benefits through small to mid-sized employers! Losing their jobs are 100,000+ agents and brokers who served as a buffer between the needs of insured Americans and the insurance companies? http://tinyurl.com/7l2oup3

It seems Kathleen Sebelius, Duchess of HHS, found the 2.02% of agent commission unworthy to be included in expenses for MLR calculations. Back to the land of unintended consequences. What roles do these agents play in the health outcomes of every-day Americans? (Ok, I understand the intent of Obamacare’s creators is to completely eliminate employer sponsored health benefits. For the sake of discussion, let’s pretend the nation comes to its senses and only permits part of PPACA to survive?)

Here’s a few instances in which agents and brokers changed the lives of their clients (1) Cancer diagnosis A woman’s physician, and consulting physician, strongly suspect she has initial stages of  serious organ cancer. They recommend advanced imaging as a diagnostic tool. The insurance company declines opting only to pay/permit exploratory surgery to collect multiple biopsy samples. The insurance broker reminds the insurance company of legal and public perception issues with such a decision and, after additional consideration, the insurance company relents. The test indicates the woman cancer free!

(2) Simple mistakes sink ships- During an open enrollment meeting an employee mistakenly prints the wrong date on the group enrollment application. The insurance company denies coverage under the group. The agent threatens to move another large group to a competitor if the mistake is not treated an inadvertent mistake. Problem solved.

(3) Deny by contract provision An applicant for individual coverage correctly answers individual underwriting questions as not knowing about heart disease. The policy is issued and after 9 months the person suffers a heart attack. The insurance company cites a prior doctor visit as proof the individual knew, or should have known they were subject to a heart attack, and denies coverage. The agent hounds the company VP of underwriting until the decision is reversed.

I know some will say the above are exactly what the entirety of PPACA will prevent! Hold on there “Kiomsabe”. If you believe free market healthcare can be tough, how about nationalized healthcare. http://tinyurl.com/nyap8o Things aren’t so rosy with the national health system in Great Britain! What makes us think our government would do better? For example, “Cash for Clunkers”

I once had a boss with very initiative advice. “Be careful what you ask for. You may get it”. Why not make provisions for uninsured American’s without destroying our current system? More on this later!

High deductible plans not working? Here’s what works, 0 deductible! December 10, 2011

My initial introduction to consumer driven plans, HDHPs, was presented in a group setting by a national carrier, or, ”industry speak” a BUCA. We were first told the reason for explosive trend is a combination of easy physician access due to low copays, better technology, our legal environment and expensive drugs. Then came the HSA regulatory part. (I used to think the 401K regs were somewhat complex)! Today, from my years of data experience, I know explosive health inflation is driven by a small percentage of members suffering worsening states of chronic disease.

Anyway, a troubling thing is sneaking up on the disciples of HDHPs and their concept of member consumerism. It’s the rapid adoption of on/near site clinics by 20%+ of employers with a thousand or more employees.

Hmm. In one corner we have plans requiring members to spend the 1st $1,000 – $10,000 before plan benefits start, And, in the other corner, all-inclusive primary care benefits with no, 0, member dollars needed. If fact, a few BUCAs are big proponents of both plans! Sort of an AC/DC strategy.

The clear winner is immediate and easy access to primary care, preferably in scenarios in which the physicians are significantly rewarded for “great” member health. A great plan discount occurs when large claims don’t occur due to prevention/early disease identification. Guess how many $70 primary care visits can be purchased for the cost of a $250K annual claim paid on behalf of a member facing end-stage renal failure? A great physician can he hired for $200K annually. So, how many members can a physician see in 12 months? Here’s a good opinion article on employer clinics! http://tinyurl.com/7rvm7sm

Cracks in high-deductible/consumer-driven health plan models November 29, 2011

I’ve always been confused by the values highlighted by proponents of HDHPs. My logic has consistently been: (1) 75% of healthcare payments are made as the result of treating chronic diseases and, if/when, caught at the earliest stages can be cured, or mitigated. (2) Shifting initial plan expenses to patients, in the form of high deductibles, tends to prevent doctor visits/medical treatment thus negatively impacting the early discovery and treatment of disease. (I understand wellness checks are paid at 100%)

Here’s some real evidence our physicians will be the keys to unlocking our national health care cost/quality problems: http://tinyurl.com/7acns8o

US healthcare without physicains, not so rosey! November 20, 2011

I find it difficult to believe the authors of our upcoming healthcare reform could have crafted a worse future by design. This author has our coming reality zeroed in, the ”change” of healthcare as we currently know it! http://tinyurl.com/86kkua2 This will not be the change we were looking for. Change isn’t always good, as the passengers and crew of the Titanic discovered on the night of April 15, 1912.

Can we change/amend this future?

Accountable patients. What patients with heart disease need to learn from cancer patients. November 18, 2011

My personal experiences in providing care for, and knowing the journey faced by, cancer sufferers is truly humbling. Under the term “courage” in the dictionary, an example should describe challenges faced by cancer patients undergoing cycles of chemotherapy and radiation therapy. Cancer patients exhibit amazing courage in battling cancer.

Many times we see an exact opposite behavior exhibited by heart disease patients so clearly stated by this doctor.

http://tinyurl.com/79fywck

Difficulties with sole source national healthcare– November 13, 2011

Not to compare our coming health reform to Greece, however this describes the difficulty of “absolute equality” between the various elements of society.
http://tinyurl.com/89qp3dc

DNA Sequencing video–Wow November 4, 2011

This presentation possibly represents the entire foundation of future disease curing and management. Stunning!  http://tinyurl.com/3zd7hqb