Value in Health Care Accounting for Cost, Quality, Safety, Outcomes, and Innovation: Workshop Summary (2010) / Chapter Skim
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4 Approaches to Improving Value - Consumer Incentives
4 Approaches to Improving Value - Consumer Incentives
Pages 111-152
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From page 111... ...
-- to be utilized as a tool for increasing value in health care. Building on the concept of value-based insurance design, Melinda Beeuwkes-Buntin discusses consumer-directed, high-deductible health plans (CDHPs)
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From page 112... ...
Concluding the session, Ronald Goetzel details the value of worksite health promotion and chronic disease prevention programs, indicating that they can yield significant health and economic benefits for employers and employees. In addition to discussing how workplace wellness programs can serve as vehicles for health behavior change, he outlines recommendations to increase employer engagement in providing evidence-based health promotion programs to their employees.
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From page 113... ...
A large and growing body of evidence demonstrates that in response to increased cost sharing, patients decrease the use of both highvalue (e.g., immunizations, cancer screening, appropriate prescription drug use) and low-value services, and may have worse health outcomes as a result (Figure 4-1)
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From page 114... ...
Increased cost sharing seems inevitable given the lack of demonstrated savings from, or unwillingness to adopt, other approaches. In the VBID paradigm, patients' out-of-pocket costs are determined by the costs and benefit of care -- zero or low copayments for interventions of highest value (e.g., mammogram for women with a first-degree relative
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From page 115... ...
VBID can address several important inconsistencies in the current system and work synergistically with other initiatives such as high-deductible health plans, disease management, patient-centered medical home, and P4P programs. By allowing different cost-sharing provisions for different services, value can be enhanced without removing the role of cost sharing in the system overall.
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From page 116... ...
A similar employer with identical disease management offerings and similar, but stable, copayments served as a control group. SOURCE: Copyrighted and published by Project HOP/Health Affairs as Chernew, M
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From page 117... ...
Leading health plans and health benefit consultants are working to make these packages accessible nationwide. Conclusion Payers desiring to optimize health gains per dollar spent should avoid "across-the-board" cost sharing and instead implement a "value-based" design that removes barriers and provides incentives to encourage desired behaviors for patients and providers.
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From page 118... ...
Scope of Consumer-Directed Care Consumer-directed health plans emphasize the role consumers can play in making decisions about their healthcare choices. These plans usually provide patients with upfront financial incentives to choose care wisely in the form of deductibles that are typically higher than those of traditional plans -- the typical consumer-directed plan has a single deductible of $1,000 or more.
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From page 119... ...
In 2007, 11 percent of Americans were enrolled in a high-deductible health plan (HDHP)
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From page 120... ...
Third, new consumer-driven designs often emphasize prevention and are coupled with other programs such as disease management programs and health risk assessments. Finally, personal savings accounts could provide patients with the liquidity they need to initiate care.
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From page 121... ...
Figure 4-2.eps vector editable
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From page 122... ...
and that the savings within the CDHP group came only through reduced pharmacy costs. However, Feldman and colleagues concluded that the CDHP they studied did not have high enough cost sharing to limit care use -- in particular, it had an HRA account to which the employer made a substantial contribution.
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From page 123... ...
; preventive care visits represent change from 2003 to 2005 for consumers Figure 4-4.eps in a health reimbursement account versus a preferred provider organization. vector editable
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From page 124... ...
One area in which CDHPs do compare unfavorably to traditional plans is appropriate prescription drug use. Building on prior work reporting that CDHP members are more likely to forgo filling a prescription because of cost than those in traditional plans, Greene and colleagues (2008)
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From page 125... ...
Consumer-directed health plans are predicated on the idea that informed and incentivized consumers can make decisions about their healthcare use that yield better outcomes at lower cost: in other words, their goal is to improve value. Putting aside whether or not CDHPs are currently doing this, the goal is a good one.
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From page 126... ...
For example, when provided with information and faced with differential cost sharing, people do switch from brand-name medications to generic drugs. However there is relatively little information available about the cost and quality of hospital procedures and services, and even less on the outpatient side.
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THE ROLE OF TIERED BENEFIT DESIGNS FOR IMPROVING VALUE IN HEALTH CARE Dennis P Scanlon, Ph.D., and Grant R
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Prevalence of Tiering Programs Tiering of prescription drugs is the most prominent form of tiering program and is emerging as a nearly universal benefit characteristic. In 2008, the Kaiser Family Foundation found that 92 percent of beneficiaries face some type of differential cost sharing.
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From page 129... ...
As part of their tiering programs, employers or health insurance plans generally provide consumers with information about how the tiers are constructed and which options are in each tier. Consumers often, but not always, face financial incentives in tiering programs, such as reduced premiums or copayments for choosing the tiers with preferred providers or treatments (Draper et al., 2007)
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From page 130... ...
Instead, beneficiaries are allowed to choose any provider but face differential cost sharing based on the tier in which the provider is placed. Another distinction from historical managed care programs is that today's tiering programs increasingly incorporate quality and safety as factors used to define tiers.
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Requirements and Technical Considerations for Tiering Programs Several factors and considerations are important when designing and implementing tiered benefits programs. These are discussed in turn.
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From page 132... ...
. Budgetary Implications Tiering programs, particularly those that include financial incentives, have budgetary implications for the program sponsor since changes in the distribution of providers, drugs, or products used have real actuarial implications.
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The Evidence Base for Tiered Benefit Programs Pharmaceutical Tiering Tiered benefit designs for prescription drugs have emerged in response to growing prescription drug costs and represent the most common type of tiering program, although drug tiering is clearly different from hospital and physician tiering. While the details of the benefit structures differ between plans, there are common characteristics.
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From page 134... ...
. One employer that has been out in front of physician tiering has been the Commonwealth of Massachusetts, thus providing a useful case study of how physician tiering programs have been executed in the real world.
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. To our knowledge there is no peer-reviewed literature examining the effect of this or similar physician tiering strategies on any kind of outcome, including physician choice, quality improvements, clinical outcomes, costs, or expenditures.
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From page 136... ...
. These lawsuits illustrate the importance of measurement and data in physician tiering programs.
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From page 137... ...
Clearly, the grouping methodology can have a great effect on health plans' tiering programs. However, if done correctly, there is some early evidence that if the financial incentives lead patients to higher-quality hospitals, the tiering structures may actually lead to improved quality of care for patients.
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From page 138... ...
Like many advances in healthcare finance and insurance design, while there is a dearth of evidence in the published literature, it is likely that some of the more innovative private sector payers and purchasers who have implemented tiering programs have amassed unpublished evidence on the topic. Despite this dearth of evidence, our analysis has highlighted some key considerations when thinking about the potential benefit and impact of tiered benefit design programs.
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From page 139... ...
While the evidence base for improving value in these areas may not be strong either, those considering tiering programs should also understand the cost-benefits of these different options. Evidence from pilot studies is needed The currently scant evidence base will be improved only if purchasers and payers implementing tiered benefit programs study the financial and clinical impact of these programs, including the return on investment to program sponsors.
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From page 140... ...
While it is not clear that a perfect communication strategy exists, plan sponsors should develop a robust strategy for communicating information about tiered benefit designs to program beneficiaries. A critical mass is important One potential problem with existing tiered benefit designs and other health finance innovations is that they have not reached a critical enough mass in the marketplace to be taken seriously by healthcare providers.
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From page 141... ...
Thus, an opportunity presents itself to positively influence population health and, at the same time, mitigate the rise in healthcare costs through workplace health promotion programs. In many ways, the workplace represents a microcosm of society and an ideal setting for introducing and maintaining health promotion programs.
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From page 142... ...
. By utilizing a workplace-sponsored health promotion and disease prevention program, employers can target modifiable health risk factors and achieve improvements in the health risk profile of their population that can lead to reductions in healthcare costs and improvements in productivity (Goetzel et al., 2002; Heaney and Goetzel, 1998; Ozminkowski et al., 1999)
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Workplace Programs as a Vehicle for Behavior Change What is the evidence supporting the positive effects of workplace health promotion on health risks and behaviors? A systematic literature review commissioned by the U.S.
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TABLE 4-2 Evaluation of Worksite Health Promotion Programs -- February 2007 Analysis Summary Results Body of Consistent Magnitude of Outcome Evidence Results Effect Finding Estimated risk 15 Yes Moderate Sufficient Healthcare use 6 Yes Moderate Sufficient Worker productivity 10 Yes Moderate Strong SOURCE: Soler et al., 2007.
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From page 145... ...
Improve employer communication and education about the benefits of effective health promotion programs We need to do a better job communicating the human and economic costs associated with poor health, the effects of not achieving health improvements, and the options available to reduce health risks. Federal, state, and local health agencies, in partnership with businesses, should leverage their extensive marketing and communication networks to share information about exemplary programs to employers.
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From page 146... ...
However, additional ones are needed to help employers design, implement, and evaluate their workplace programs. Pilot innovative health promotion programs at federal, state, and local health departments and agencies It is ironic that most government agencies do not have state-of-the-art programs for their own employees and dependents.
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From page 147... ...
, have recently introduced review processes focused on workplace vendors and health plans. These organizations should be encouraged because they will improve the quality of health promotion programs and introduce a level playing field of competition across programs and vendors.
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2008. Do consumer-directed health plans drive change in enrollees' health care behavior?
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From page 149... ...
2008. The impact of consumer-directed health plans on prescription drug use.
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From page 150... ...
Kaiser Family Foundation and the Health Research Educational Trust.
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2008. The effect of consumer-directed health plans on the use of preventive and chronic illness services.
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From page 152... ...
2008. Physician tiering: For Unicare state indemnity plan basic, plus.
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