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Discounts and Cost Shifting: Today’s challenge for Self-funded health-plan managers December 11, 2012

Posted by medvision in Chronic Disease, health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Risk Management, Rx Costs, Uncategorized.
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health, paying for healthcareIn my experience in health plan risk management and benefits planning, nearly all large self-funded plans don’t have dollar shortages.  They have allocation problems. In today’s healthcare environment, managers need to know their “real” problems and their vast improvement opportunities. Independent, member-centric, HIPAA-compliant data is not a luxury — it’s the “oxygen” necessary to ensure plan survival in today’s economic climate.

If ever a cat and mouse game existed, it could be best illustrated by today’s billing practices confronting self-funded plan managers.

Years ago, consultants badgered insurance companies and providers over their in-hospital daily rates. Hospitals quickly realized many of the in-patient procedures could be performed in an outpatient setting and, in turn, made up their inpatient financial losses by loading outpatient billing rates.

Consultants, MCO’s and plan managers maintain an on-going tit-for-tat game in the provider discount arena.  Basically, no consultant can definitively analyze a MCO’s overall discount because they cannot access hospital contracts, and hospital charges make up 60-70% of annual plan expenses. Given this lack of hospital contract knowledge, they rank health plans by a stated percent discount off of billed charges. Providers have the ability to increase their billing, charge master,  thus, the discount off billed charges is less relevant.

A more relevant measurement is the amount self-funded employer plans pay as a percentage of Medicare provider reimbursements, for given geographic areas. In my consulting practice, we employ independent, deep-mining healthcare software to analyze the clinical and financial status of the plan’s performance. Recently, with the advent of the national healthcare reform law, PPACA, we discovered certain data elements being charged in manners never seen.

For instance, most plan sponsors today see aggregate annual outpatient claims almost equaling annual inpatient claims.  Outpatient procedures are when the patient comes to the facility, usually in the morning, receives a medical procedure, and goes home in the afternoon. By definition, outpatient procedures cannot be of a very serious nature, although the patient can have serious disease. In contrast, inpatient procedures require 24-hour care by physicians and nurses and can last weeks or months.  As an example, some patients with heart disease are well enough to undergo heart catheterization/angioplasty in the outpatient setting.

Let’s get to the billing issue now.  On average across America, Medicare reimburses hospitals, in the outpatient setting, for angioplasty an amount averaging $4,000. The physician, interventional cardiologist, receives approximately $800. But I’m seeing multiple instances in which our self-funded plan sponsors are paying in the neighborhood of $40,000 plus or minus. Rough arithmetic would show the $40,000 payment to be 800% to 900% above the average annual Medicare reimbursement.  I’m sure this is not a shock to many plan managers as everyone knows the commercial side of healthcare helps finance shortages from Medicare, Medicaid, and unreimbursed indigent care.  Employer plan sponsors can do much better than this ratio by direct contracting with best-of-class interventional cardiac providers.

Now for the jaw-dropping part: If a consultant requests the plan sponsor’s average cost for angioplasty, he or she would probably supply a list of codes aligned to angioplasty, outpatient,   and wait for the answer.  What we are discovering is that the paid billing indicates the codes aligned with angioplasty are populated by very small dollar amounts; however, on the date of service, a large dollar billing of $40,000 is described as a low-cost medical service, sterile IV solutions (saline), listed under the procedure description, while the actual descriptive procedure, CPT code, is listed under a blinded aggregate hospital revenue code. This produces a scenario in which normal queries would not identify the large $40,000 amount paid and requires a detailed, line-by-line billing to investigate the appropriateness of the charge.

How prevalent is this practice? In one instance, medical claim dollars listed under sterile IV solutions, pharmacy incidental to radiology, generic pharmacy, and non-assigned pharmacy equaled $25 million over 24 months.

Without further investigation, it is virtually impossible to ascertain if these dollars are being spent correctly under contracted arrangements. At best, it represents new escalations in the game of hide-and-seek.

And the real concern lies in the subject of cost shifting. Ponder this question: Not counting physician office visits, what percentage increase is fair in addition to the amount providers receive from Medicare reimbursements? Remember that with high-cost healthcare procedures your plan is reimbursing providers much more that Medicare for the exact same treatments/procedures.  It’s a tough question.  Although if we are to maintain employer-sponsored healthcare, it must be addressed. My guess, 200-300% is fair.  And 800-1000% is unreasonable.

This issue is important as commercial plans cannot meet the financial shortages coming in the future.  Another outpatient assumedly situation showed a payment of $78,000 to a hospital assumedly all under contracted rates, in network. If the patient spent eight hours at the facility, employer’s bill equaled $9,750 per hour. This seems expensive.

Another plan management “treat” is represented PBM vendors charging plans 1000%+ more for common generic drugs than members can pay at retailers, Costco, Target, and Walmart. Yes, employer plans save a few dollars from generics, but the lion’s share of savings are gobbled up by PBMs.  Moral of this story: Study your contracts carefully and know that it could be in your organization’s best interest to seek support from a health-plan risk management firm relying on independent health & pharmacy data software.

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Blind Faith: Self-Funded Health Plan Management and Hospital Billings November 16, 2012

Posted by medvision in Chronic Disease, Employee Wellness, health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Risk Management, Rx Costs, Uncategorized.
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Blind Faith: Self-Funded Health Plan Management and Hospital Billings

 Health CostsMany things concerning our current healthcare situation leave me in amazement. For example, today an article featured in “The Hill” highlighted a 4-5% decrease in healthcare inflation, which is a positive sounding reduction. http://tinyurl.com/czmmdz4  The national consultant attributed this to America’s adoption of high deductible health plan programs. This would seem logical if our national problems were based upon members utilizing too many $100 doctor visits. In other words, make patients 100% responsible for funding doctor visits, prescription medications and other high-value, low-cost health services. This sounds terrific until one discovers an excess of 75% of our national healthcare expenditures go to mitigate/control existing chronic disease. So is the logic “prevent the low-cost services to inflate high cost chronic disease services”?

 Unfortunately, the above can only make sense to plan managers who have no independent, actionable data. One simple exhibit, the expense distribution analysis, would show plan managers that a very small number of their members account for huge expenditures of claim dollars. Let’s assume a plan provides health benefits for 10,000 members (employees, spouses and children). If together the plan sustains $36 million in annual claims, a typical report would note a per-member-per-year, PMPY, expenses equaling $3600.  If the real expense distribution analysis was available, one would see:

-Top 1% (100 members) incur annual average claims of $90,000 each;

-Next 4% (400 members) incur $35,000 each;

-Next 25% (2500 members) incur $3000 each;

-Next 20% (2000 members) incur $1500 each; and

-Bottom 50% (5000 members) incur $500 each.

Notice the above does not include member paid coinsurance or monthly payroll deductions for coverage. Now, the plan manager is  advised to increase the deductible to $2000 per member before any plan benefits are payable. Why? Give members skin in the game! Immediately, it’s easy to see 50% are completely disenfranchised from any benefit payable. Does it make sense for the plan sponsor to eliminate benefits payable for the bottom 50% to 60%?  How much impact will the new $2,000 deductible have on the top 1% members spending an average of $90,000 per year?

Remember that very sick members are not consumers in the sense of purchasing an automobile. They are fighting for their lives. The bottom 50% of members are not consumers either, as the vast majority are not in life or death disease struggles.  Due to the 100% expense, these 50% are foregoing necessary wellness visits and other necessary disease management services. From a risk management standpoint, this plan design doesn’t compute.  I think this builds a speed lane into the top 5%/1%!

 The centerpiece of my consulting practice at Med-Vision is actionable, independent, HIPAA compliant, patient centric health plan data. Recently, while digging through a client’s outpatient hospital data, I noticed a $7 million paid run of charges recorded under revenue codes entitled — other pharmacy IV solutions and pharmacy incidental to radiology. These have no detail, no backup, and will require the administrator to request itemized billings to investigate. This could be totally legitimate, but I find it amazing clients are scouring the lunch tabs of their sales force and increasing the deductible for needed member preventative health services, while blindly paying $7 million for possible saline injections.  If this isn’t a home run example of the necessity of actionable data, nothing else is.

I often joke that many large self-funded health plans could be purchasing someone a brand-new Mercedes- Benz, S-500, each month with no notice.  It’s time for employers to take notice, evaluate their plans, implement solutions, and gain control of their healthcare costs.  What’s more, with the right plan design and data analytics, costs can be cut while simultaneously enhancing benefits and improving the quality of care.

                                                                                           

Ominous threat to employer sponsored healthcare July 25, 2012

Posted by medvision in Chronic Disease, Employee Wellness, health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Risk Management, Rx Costs, Uncategorized.
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If your job involves managing employer sponsored health plans, on behalf of employers, there’s an article out (http://tinyurl.com/d836mol) that  says the following:

One in 10 employers plan to drop health benefits.

Employee Health, Wellness, Health Plan, DataI hope this is a huge wake-up call for employers.  Over the past 10 years, I’ve pounded the pavement trying to explain the necessity for plan executives to utilize actionable, independent, member-centric data to manage the financial and clinical aspects of their health plans. Some employers have adopted this model and, as a result, their trend/health inflation has become virtually nonexistent over the past several years. Just look at Med-Vision’s news page for examples.  Many others, however, have declined and are flying, virtually blind.

Let’s think about the impending threat to our current system of healthcare delivered at work. First, which types of employer plans are at the highest risk? To make my point, I’m borrowing from the comedic styling of Georgian funnyman, Jeff Foxworthy:

(1)        If you report to an elected board, commission, mayor or any other type of politician who grovels every few years to be reelected, you might have a problem

(2)        If your annual per employee plan costs are $8,000 plus, versus the penalty of $2000 PEPY to drop coverage, you might have a problem

(3)        If your plan design pays claims for an unlimited maximum, while you attempt to save money by preventing care during the first $10,000 of expense, you might have a problem

(4)        If your plan advisors, broker, consultants tell you your existing 10% trend fits the norm, you might have a problem

(5)        If your plan pays hundreds of thousand dollars annually for disease management and the only result you see is one out of 100 members talking to a nurse, you might have a problem

So, maybe you fall into a few of the top Foxworthy-isms. Believe it or not, this performance can be turned around in as little as a year or two. What do you do?  Here’s my advice:

•           Work with advisors/vendors who win solely when you win. If you’re partnering with a public company, MCO/consultant/broker, look at their financial performance on one of the multiple finance websites. Yahoo finance is a great spot. How is their stock, profits, cash flow performance? If they are succeeding wildly while your plan fails, you probably are not receiving the best advice? Why would you pay more in fees and commission while your plan performs negatively? Pay for performance and zero for failure. Make your advisors stay awake at night worrying about the care/lack of care your members receive. If your plan is failing, yell, scream and threaten firing all vendors. Here’s a nice take-away. MCOs are dumping huge sums of cash into client wellness funds to be selected during bidding competition. If you are humming along with an MCO/TPA, demand some wellness cash!  Ask $40K per thousand employees covered.

•           Are you treating plan reports, performance metrics from your MCO/TPA as gospel? Do you think they report on failures/weaknesses concerning your plan while you pay fat ASO fees? (If so, I have some beautiful, airboat accessible, home sites in the center of the Everglades for you to consider purchasing). This is where plan managers fly blind. Identify and implement services from an independent, patient centric deep data mining company. Analyze health data as a risk manager focusing on prevention, disease mitigation and financial accuracy. Read and analyze your existing employee benefits contracts closely. With your data mining functionality you’ll be able to determine if your plan is paying 2000% markups for cheap generic drugs delivered via mail. PBM performance is an easy way for plans to save $10-$15 PEPM. Ask simple questions like, what percent of our women members are receiving breast cancer screenings past age 50?

•           Where is your health plan money being spent by service category? Plans performing in the top 10% spend over 15% of their total budget on primary care services. The vast majority I see spend less than 10% on primary care.

Furthermore, please don’t be assured a Republican win in November will clear the threat. The “right” wants to remove the corporate tax deductions for employer sponsored healthcare.  An era of employer-driven healthcare reform is needed to mitigate risks and lower costs.

And a last thought. Worry about your plan members receiving appropriate health care services in the same manner you worry about your family members receiving correct care. The higher the quality, the lower the cost!

As Geoffrey Hickson said: “If you forget you have to struggle for improvement you go backward.

Healthcare price transparency and the empty airplane seat July 6, 2012

Posted by medvision in Chronic Disease, Employee Wellness, health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Risk Management, Uncategorized.
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health, paying for healthcareAnyone paying attention to our current national healthcare situation has surely seen published examples of pricing defying all realms of logic. For example, MRIs priced at $3000 for individuals without insurance, $1500 for individuals with insurance and, wow, $300 for individuals paying cash. Here’s the result of a recent Consumer Reports Study! http://tinyurl.com/7pnj4wx

I know, things like this make you want to pull your hair out. It’s simply a function of no transparency, infused with high utilization rewards/fee-for-service, plus a lack of value measurement, coupled with oversupply, fragmentation of care and unaccountably from spending someone else’s money. Our healthcare system lacks basic laws of supply and demand, accountability and economic reality. On the good side no place on earth can provide better care needed for critically ill patients.

For plan managers, such marketplace disruption can create some phenomenal opportunities to provide member care while sequentially saving vast dollars sums. For example, let’s say you’ve swallowed the consultant’s Kool-Aid and have a HDHP plan design w $3000 deductible while allowing members to make deposits into an HSA. Yes, yes, we all know annual physicals are covered at 100%, assuming nothing is diagnosed. However, you’ve adopted a plan design which essentially prevents members from receiving the lowest cost, highest value healthcare delivered to prevent chronic disease or manage emerging disease. For the sake of argument, let’s assume the same plan design in place but look to the crazy pricing variances for ways to cover the underinsured risk, i.e. the first $3000 annually:

  • Primary care. If your members are within a distinct geographic area/areas, why not contact a few of the larger primary care practices and ask for a capitated, or cash deal to treat your members? Cash deal means completely outside of your plan. Members would have no co-pays for doc visits and blood tests. Common low-cost generic drugs could be paid by the member or reimbursed by the employer, in or outside of the plan. What kind dollars would be involved here? Maybe an initial $100 cash payment when a member goes to the physician followed by a $40 per member per month payment.
  • Ancillary care. From the press we know pricing differences are amazing. Cash prices for CAT Scans can be 10% of the insured price. Simply coach members with the option of calling providers and asking for the cash price without mentioning they have coverage under a high deductible plan. These vastly reduced cash prices will not go towards the satisfaction of the deductible however from an economic perspective this practice makes perfect economic sense.
  • Inpatient hospital care. This is what insurance is for, so have members utilize the discounts available under the high deductible plan.

Empty airplane seat? I use is simply as an explanation of why such extreme variances exist in the health care system. A jetliner taking off with empty seats is simply losing seat revenue. This is why such wild price variances exist in the airline industry. It’s better to collect $.50 from a dollar ticket then receiving zero from an empty seat. The exact same thing happens with healthcare procedures. As an example, hospital A purchases a $2 million dollar CAT Scan machine. The hospital’s fixed cost is exactly the same whether it’s being utilized or not. Their expense includes capital outlay, interest and personnel necessary to operate the equipment. If they normally received $2000 per procedure and equipment is not utilized 50% of the time, it makes perfect sense to collect $300 per procedure during the time the machine is not being utilized for the $2000 procedure. Pricing information is invisible to consumers and the fact they charge either $2000 or $300 isn’t a problem.

How to plan managers take advantage of these situations? The answer is simple. The same way we purchase cheap airline seats. We explore, question, investigate and ask. The attached link shows a physician perspective.  http://tinyurl.com/chx8quh

Employee benefits contracts-read and understand prior to signing! June 19, 2012

Posted by medvision in health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Uncategorized.
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Employers sponsoring self-funded health benefit programs typically make vendor decisions based upon proposals submitted in a “request for proposal” (RFP) process. A decision is made to contract with, for example, ABC administrator/pharmacy benefits administrator, an application is signed and a contract returned for execution. I’m always amazed when I ask a client employer for a vendor contract and initially receive the actual proposal, instead of the contract. Why? Because proposals show clients what they think is being purchased on behalf of members but executed contracts rule the process. Typically, disputes don’t come from the benefits delivered but from the pricing methodology/price the client thought was agreed to.

As an example, many managers believe with self-funded arrangements they are paying a fee in return for service. Some plan sponsors exhibit shock when they learn their vendors are enjoying additional profits by spread-pricing products purchased via their administrative services only, (ASO) agreements.

One of the great puzzles associated with the employee benefits arena is how a large employer’s legal team can hold up a contract to purchase “trucks” for months, on intricate contract details, but then blindly provide authority to sign employee benefits contracts which run counter to the proposals used in the decision process. The following represents contractual clauses from a prescription benefit management company. I have underlined a few provisions which should provide anxiety to the individuals preparing to sign this contract.

Why worry about this? In many instances these practices unnecessarily increase the fixed cost of programs. For example, the contract below may increase cost of prescription drugs to members by $10-$15 PEPM. If this amount were reallocated to provide additional health services possibly employer paid health care inflation could be eliminated?

 

FINANCIAL DISCLOSURE TO DEN INDEMNITY SCRIPT COMPANY PBM CLIENTS

 

This disclosure provides an overview of the principal revenue sources of Den Indemnity Script Company, Inc. (DISCO) and does not supersede any of the specific financial terms and conditions between DISCO and an individual client. In addition to administrative and dispensing fees paid to DISCO by our clients for pharmaceutical benefit management (PBM) services, DISCO derives revenue from other sources, including arrangements with pharmaceutical manufacturers, wholesale distributors, and retail pharmacies. Some of this revenue relates to utilization of prescription drugs by members of the clients receiving PBM services, DISCO may pass through certain manufacture payments to its clients or may retain as payments for itself, depending on the contract terms between DISCO and client.

Network Pharmacies— DISCO contracts for its own account with retail pharmacies to dispense prescription drugs to client members. Rates paid by DISCO to these pharmacies may differ among networks and among pharmacies within a network, and by client arrangements. DISCO agreements generally provide that the client pay DISCO for ingredient cost, plus dispensing fees, for drug claims at a uniform rate. If the rate paid by client exceeds the rate contracted with a particular pharmacy, DISCO will realize a positive margin on the applicable claim. The reverse may also be true, resulting in a negative margin for DISCO. DISCO also enters into pass-through agreements where the client pays DISCO the actual ingredient cost and dispensing fee DISCO pays the pharmacy. In addition, when DISCO receives payment from a client for payment to a pharmacy, DISCO retains the benefit of the use of funds between these payments. DISCO may charge pharmacies transaction fees to assess this goes pharmacy claims system and for other related administrative purposes.

Brand/Generic Classifications— Prescription drugs may be classified as either a brand or generic however, the reference to a drug by its chemical name does not necessarily mean that the product is recognized as a generic for adjudication, pricing or co-pay purposes. DISCO distinguishes brands and generics through a proprietary operating algorithm that uses certain published elements provided by First Databank including price indicators, generic indicator, generic manufacturer indicator, generic name drug indicator, innovator, Drug Class and ANDA. The proprietary algorithm uses these data elements in a hierarchical process to categorize the products as brand or generic. The proprietary algorithm also has processes to resolve discrepancies and prevent hopping between branded generic status price fluctuations in marketplace availability changes. The elements listed above and sources are subject to change based upon availability of specific fields. Updated summaries of the proprietary algorithm are available on request.

DISCO Subsidiary Pharmacy Discount Arrangements— DISCO subsidiary pharmacies purchase prescription drug inventories, either from manufacturers or wholesalers, for dispensing to patients. Often, purchase discounts off the acquisition cost of these products are made available by manufacturers and wholesalers in the form of either upfront discounts or retrospective discounts. These purchase discounts, obtained through separate purchase contracts, are not formulary rebates paid in connection with our PBM rebate programs. Drug purchase discounts are based on the pharmacy’s inventory needs and, at times, performance of related patient care services and other performance requirements. When a subsidiary pharmacy dispenses a product from its inventory, the purchase price paid for the dispense product, including applicable dispensing fees, may be greater or less than that pharmacies acquisition cost for the product net of purchase discounts. In general, are pharmacies realize an overall positive margin between the net acquisition cost any amounts paid for the dispense drugs.

What about our national primary-care physician shortage? June 19, 2012

Posted by medvision in health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Uncategorized.
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During America’s healthcare debate, we’ve heard many arguments for and against the various elements included in the president’s PPACA law.

A significant problem, acknowledged by all parties, is the looming shortage of primary care physicians. Primary care physician compensation has been shorted when compared to pay physicians specializing in disease categories, types of patients or methods of treatment. This has resulted in those physicians responsible for treating the whole patient, quarterbacking the complex maze of specialists, testing, procedures and hospital stays, receiving the lowest pay in the hierarchy of physician specialties.

No one should be surprised to learn students in medical school are steering away from the various primary care specialties. Given the reality of a shortage of primary care doctors, the manner in which primary care offices operate can virtually determine “life or death” outcomes for patients. The attached describes this scenario:

http://www.kevinmd.com/blog/2012/06/long-waits-access-primary-care-avoidable.html

A necessary solution to long-term primary care woes are mapped out in a program entitled “MD CEO”. Authored by Dr. Scott Conard M.D., a brilliant Dallas Texas-based primary care physician, MD CEO is a process which enables the skills of “physician extenders” to quickly and efficiently serve patients in the doctor’s office for conditions of clear “empirical medicine”. This program aligns the physician’s time to serve patients with conditions requiring “intuitive medicine” while sequentially providing medical leadership serving all patients.

www.themdceo.com

If I want my plan to fail (pt.2): June 2, 2012

Posted by medvision in Chronic Disease, health data, Healthcare Costs, Insurance Plans, Risk Management, Rx Costs, Uncategorized.
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Health Costs, Rx Costs“I won’t question nationally published cost statistics and wonder if these “industry averages” apply to my member population.  When I read an article stating an average family of four incurs health claims in excess of $20,000, my mind closes”.  http://www.marketplace.org/topics/your-money/makin-money/family-health-care-costs-breach-20000

What does “family of four” typically denote? Most would think, mom, dad and two kids? Look outside of your house, condo/apartment and notice a family on a stroll. How many think the average family walking by incurs $20K per year in claims? So, how could Milliman publish such a high average, or high “Milliman Medical Index, MMI”?  

From a pure mathematical perspective I’d never question the validity of their result. They took millions of values (family claims) came to a total and then divided by the number of values to obtain the average or mean. We should be asking, “is this average a reasonable representation of the “central tendency” or essence of the data”? Another way to think of the Milliman average is what does this number/average tell us about health care risk?

When thinking of families of four, I find it hard to comprehend the average claims expense is in excess of $20 thousand dollars, annually? Could both be correct? The answer is yes, however I hope to convince the audience the Milliman average is unrepresentative of the “central tendency” of the values (family of 4 health claims) as this average is obviously calculated including huge claim values (high) outliers.  Here’s a very clear video explaining the manner outliers change our perception of data sets.  http://www.statisticslectures.com/topics/outliereffects/#video

Huge average claim values tend to “breed” stagnation concerning intelligent plan management actions!

When looking at “average per member per year plan cost” why let consultants define average in a different manner than the financing of the plan? Most plans re-insure specific member claims to a “specific” deductible amount and receive reimbursements for amounts over this deductible. However, when computing the annual per member/employee cost, these amounts reimbursed are included grossly inflating the average cost! In fact the top 1% of members, by claims cost, incur approximately 30% of all plan assets. Removing these as outliers would provide managers a more accurate “central tendency” of their claims data.

If I want my employer health plan to fail, I’ll — ? (Pt 1) May 15, 2012

Posted by medvision in health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Uncategorized.
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http://waysandmeans.house.gov/News/DocumentSingle.aspx?DocumentID=293471

50% of Americans receive health care coverage through their employers. Much discussion is being focused upon the extent  Obamacare/PPACA will provide financial incentives  facilitating employers to drop health coverage, and thus, sending employees/dependents into state exchanges.

Some of us foresee state exchanges as another term for “standing in the Medicaid line”. The above attachment possibly crosses line into politics and I apologize to those offended. I do believe people exist, on both sides of political spectrum, who don’t favor the elimination of employer-provided health coverage.

Granted, America does have systemic healthcare problems. Plan managers, (benefit managers, HR officials, risk managers and brokers/consultants) have huge influences on the quality and cost of care.

Recently, I’ve run across situations where plan managers appear unconcerned of the impact decisions have on their plans. I sometimes walk away wondering why they elect options of obvious detriment to the plan. Maybe its of value to write about some of the, in my opinion, incoherent decisions I stumble across. I’ll summarize these under: If I want my plan to fail

(1) If I want my plan to fail

I’d make health care purchasing decisions in a way “exactly opposite” from the manner any other goods/services are purchased by my organization. I would accept unrecognizable performance metrics, purchasing proposals by the pound and justify decisions based mainly on what my competitors, down the street. decided to. I’d allow myself to be persuaded this decision is based upon benchmarking. I don’t demand  independent data and am completely unable to measure quality of care been purchased.

(2) If I want my plan to fail:

I’d work exclusively with advisors and consultants lacking the same long-term interests as my organization. The more my plan fails, dysfunctions and produces high cost, the more we pay in compensation.  In sequence with my advisors, we fail to allow vendors/service providers with new ideas/new processes to propose for our business. After all, we only want to do business with the mainline providers who provide average benchmark results!

(3) If I want my plan to fail:

I  execute legal documents composed of provisions, definitions and terms written entirely by the vendor. Rarely do these documents align with promises and provisions made in vendor proposals. Commonly they omit our rights to audit, limit termination rights and  provide no recovery for large financial mistakes. While every other contract, apart from employee benefits, is analyzed for weeks, healthcare provisions are indeed complex and due diligence is accomplished by someone else.

Cancer is about patients and the community May 5, 2012

Posted by medvision in Cancer Care, Healthcare Costs, Uncategorized.
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America is blessed with wonderful physicians. This oncologist’s article moved me by his description of cancer’s broad impact on care givers, family and loved ones. I took this cancer-care journey with my Mom. From a healthcare perspective, my experience highlighted the importance individual members/patients.

http://www.kevinmd.com/blog/2012/04/stop-someones-oncologist.html

Economy taking a toll on healthcare spending April 19, 2012

Posted by medvision in Chronic Disease, health data, Healthcare Costs, Healthcare Reform, Insurance Plans, Risk Management, Rx Costs, Uncategorized.
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Health Costs, Rx CostsIn my last 8 years working with employer-sponsored self-funded health plans, and their health claims data, one common element is always a signal as to their clinical and financial health. It’s amazingly simple! The higher the total ratio of primary care cost to total cost, the better the plan performs. (Lowest trend, lowest cost and highest member compliance rates to evidence based medicine/screenings) For example, if a plan only spends 8% of total dollars on primary care, then the plan’s condition is sick/poor. Why? Because the balance, 92% is being spend due to advanced disease–in hospitals, seeing multiple specialists, utilizing high-cost technology and receiving costly drugs.

Again, why? Primary care is low-cost/high value. Primary care is preventative care or health maintenance-care, instead of reactive disease care. This makes sense and is the major reason employer sponsored on/near site primary care clinics, save so much money on disease care! (These centers charge no member co-pays or co-insurance for primary care visits and generic drugs)

Here’s an article saying the public is skipping primary care visits due to the down economy! If you are responsible for an employer sponsored health plan, you need to make member primary care compliance a critical metric. A stay-awake-at-night concerned, metric.

http://www.marketwatch.com/story/health-care-spending-takes-a-hit-2012-04-18

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