Cartoons for Health Care Professionals

by Clive Riddle, April 15, 2011

As a child I recall looking forward to Saturday mornings, filling a bowl full of cereal and sugar before my parents were awake, and plopping down in front of the television to view an endless parade of my favorite cartoon characters.

Now, anyone involved in the business of health care can sort of re-experience this feeling (bowl of cereal and sugar optional) by consulting YouTube and browsing through an increasing stream of short animated features created to for the professional.

Of course you’ll have to wade through an even larger river of health care animation created by the masses to comment on health care reform, politics and hospital visits. But here are some recent mainstream efforts at delivering health care business information in a new format, often with a dose of humor:

Milliman calls the stars of their animated features “Droids” and offers three items so far in their Healthcare Town Hall:

• Droids discuss health insurance rate setting process
• Droids discuss cost shifting
• Droids discuss individual mandate

Jeremy Engdahl at Milliman says they’ve “been exploring how animation can help educate people on misunderstood components of the health system in general and health care reform in particular.” He notes the videos have been peer reviewed by actuaries and are backed by published Milliman research.

Kaiser Family Foundation recently released Health Reform Hits Main Street which comes with the following description: “Confused about how the new health reform law really works? This short, animated movie -- featuring the ‘YouToons’ -- explains the problems with the current health care system, the changes that are happening now, and the big changes coming in 2014. Written and produced by the Kaiser Family Foundation. Narrated by Cokie Roberts, a news commentator for ABC News and NPR and a member of Kaiser's Board of Trustees.”

Accountable Care Organizations have perhaps been the topic of the greatest number of health care business animations. Leading the pack in viewership, with 77,000+ views,  is a piece by CenturaHealth entitled In Search of an Accountable Care Organization (ACO) which the hospital organization describes as: “Clueless health care executive tries to learn about accountable care organizations in the age of health care reform.”

The Disease Management Care Blog has a YouTube Channel featuring several animated pieces including “Setting Up An Accountable Care Organization” and “Disease management saves money.”

Alan Genicoff, MD JD who offers a Law Doc blog has a YouTube Channel which includes the “healthcare fraud cartoon parody: The Medicare RAC audit” in which we’re told to “watch Dr Abel squirm as the Medicare RAC auditor takes him to task about possible overbilling of Medicare.”

And of course I’d be remiss if I didn’t mention that MCOL has entered the fray, and features a number of animated pieces in it YouTube Channel: MCOLdotcom.

Now, does anyone remember the words to the theme song from Scooby Doo or the Banana Splits?

Fidelity on Retiree Future Health Care Costs and HSA Participation

By Clive Riddle, April 1, 2011

Fidelity Investments tells us that the total amount a couple just entering retirement needs to have saved for their future health care costs dropped this year from past estimates, due to one-time savings from health reform. Fidelity also tells us that HSAs are a recommended vehicle to help fund these required costs, and almost all their HSA account holders rolled over some account balance from 2010 to 2011 to save for these costs.

Fideltiy this week released their annual estimate of future health care costs for retired couples. Last week, Fidelity released findings on their study on how Fidelity HSA participants are using their accounts. The two topics overlap, as HSA participation is of course, a recommended strategy by Fidelity for persons preparing for retirement.

Fidelity cited their recent survey that indicated 68% of pre-retirees “said the cost of medical care in retirement is one of their three biggest financial concerns (outliving savings and inflation were the other worries).”

Fidelity now estimates “a 65-year-old couple retiring this year will need $230,0001  to pay for medical expenses throughout retirement, not including nursing-home care.  This represents an 8 percent decline from last year, when the estimate was $250,000” and costs increased 4.2% over 2009 costs.

Previously, the estimate has increased an average of 6 percent annually since the initial calculation of $160,000 in 2002. Fidelity indicates the “$20,000 decline in the estimate from last year was driven by Medicare changes contained in the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act, both signed into law in 2010.  These changes, which reduced out-of -pocket expenses for prescription drugs for many seniors, resulted in the reduced estimate.” The health reform changes include a required 50% discount on brand name drugs that are applied to beneficiaries “donut hole” benefit level, and ultimately phases out the donut hole by 2020.

Brad Kimler, EVP of Fidelity’s Benefits Consulting business tells us “while the savings generated through the health care reform laws is a welcome relief to many seniors, it should be considered a one-time adjustment, at least for the time being. Today’s workers still face the prospect of significant medical expenses in retirement and must begin to include those costs in their retirement plan strategies. Looking forward over the next few years, Americans should expect health care expenses to continue to increase annually due to a number of factors including higher costs for medical services, the introduction of new technology and an increased utilization of health care services like diagnostic testing,”

The Fidelity Retiree Health Care Costs Estimate “assumes individuals do not have employer-provided retiree health care coverage, but do qualify for the federal government’s insurance program Medicare.  The calculation takes into account cost sharing provisions (such as deductibles and coinsurance) associated with Medicare Part A and Part B (inpatient and outpatient medical insurance).  It also considers Medicare Part D (prescription drug coverage) premiums and out-of-pocket costs, as well as certain services excluded by Medicare.  The estimate does not include other health-related expenses, such as over-the-counter medications, most dental services and long-term care.”

Fidelity, in commenting on their retiree health benefit cost estimate, hold out HSAs as a recommended savings tool. William Applegate, VP, HSA products for Fidelity Investments tells us “the continuing rise of health care costs combined with health care reform really drove the adoption of HSA-qualified health plans  by employers last year and thus the growth of HSAs. As for participants, it is clear that many are using the health-savings product to help manage not only their current medical expenses but also plan for future expenses, with nearly all participants carrying some balance over to the following year.”

Fidelity’s analysis of their 74,000 HSA participant accounts indicated the following patterns and behaviors:

• On average, HSA participants had contributions of $2,620 made to their accounts in 2010  including their own contributions and employer contributions.  
• 17% of  participants contributed, through both their own and employer contributions, more than $5,000 to their account in 2010
• 46% of participants had contributions of $2,500 or more in 2010
• 36% of participants used more than 90 percent of their annual HSA contribution on qualified medical expense reimbursements,
• 40% of participants used between 10 percent and 90 percent of their HSA contributions and carried over the rest.
• 24% of participants used less than 10 percent of their annual contributions and invested the balances for future health expenses.
• Overall, 95% of participants carried over some balance from year to year

Consumerism: 2011 Industry Insiders Perspective

by Clive Riddle, March 18, 2011

A Consumerism e-poll, involving three brief questions, was conducted in conjunction with the recently concluded 10th Annual Consumerism Web Summit. While questions in the e-poll have changed over the years, the current survey has some recent historical basis for comparison.

Survey respondents were asked the same questions from 2008 - 2011 regarding ranking typical components of consumerism, and their perspective as a respondent. Respondents were also asked in 2010 and 2011, to what degree the success of health care consumerism initiatives depend upon provisions of health care reform.

Below are summary findings from the e-poll. As you can see, overall rankings of these components of consumerism haven’t really shifted from 2008-2011. However, insiders do feel the future success of consumerism initiatives is much less dependent upon health care reform, then they felt a year ago.

1.  Please numerically rank these typical components of Consumerism according to their value from your perspective.

(Rank 1 through 5 with 1 = highest value and 5=lowest value, and only use each ranking once; i.e. only rate one item a 1, one item a 2, etc.)

	2011	2010	2009	2008
	Mean	Mean	Mean	Mean
Price and Quality Transparency	1.76	1.85	2.00	1.83
Wellness Incentive Programs	2.86	3.03	2.65	2.86
Account Based Plans (HSA/HRA/FSA)	2.90	3.06	3.08	2.97
Web Based Consumer Patient Health Records	3.53	3.35	3.70	3.63
Retail Medicine (Convenient Care, etc)	3.57	3.69	3.57	3.71

	2011	2011
	Median	Mode
Price and Quality Transparency	1	1
Wellness Incentive Programs	3	2
Account Based Plans (HSA/HRA/FSA)	3	2
Web Based Consumer Patient Health Records	4	4
Retail Medicine (Convenient Care, etc)	4	5

2. To what degree are the success of health care consumerism initiatives dependent upon provisions of the Affordable Care Act? (in 2010, the question was phrased: "…dependent upon the outcome of any impending health care reform? “)

	2011	2010
Highly dependent	21.2%	36.4%
Somewhat dependent	47.7%	41.2%
Not very dependent	31.1%	22.5%

3. My perspective is as a: 

	2011	2010	2009	2008
Purchaser (Health Plan, Employer, TPA, Agent, PBM)	37.1%	43.4%	30.6%	37.9%
Provider (Hospital, Physician, Pharmaceutical, Other Providers)	34.4%	24.0%	27.1%	36.2%
Vendor/Other  (Vendors, Consultants, Institutions, Gov., All Other)	28.5%	31.8%	42.4%	25.9%

n = 154 for 2011, 189 for 2010, 96 for 2009, 59 for 2008

What Happens to Those Unspent Dollars Inside an HSA?

By Clive Riddle, March 11, 2011

Eric Remjeske, President, and Jon Robb, Investment Associate, at Devenir gave a presentation during this week's Tenth Annual Consumerism Web Summit, in which they addressed Health Savings Account investment options and activity, based on their 2010 Devenir HSA research report.

Here’s some of the data Eric and Jon shared with the audience:

• National HSA assets in 2010 were $9.4 billion in deposits and $0.7 billion in investments
  
  
• This is projected to grow to $50.4 billion in deposits and $10.3 billion in investments in 2015. 
  
  
• 52% of HSA consumers were aware they had investment options for their HAS
  
  
• The average total balance (deposit and investment) in an HSA account was $11,635 for HSA account holders that held investment accounts
  
  
• The average yearly administration fee for HSA investment programs is $32
  
  
• In 2009 the average annual account activity broke down as follows: Personal Deposits $2,050; The average yearly administration fee for HSA investment programs is $32
  
  
• In 2009 the average annual account activity broke down as follows: Personal Deposits $2,050; Plus Employer Contributions $1,058; less Withdrawals $1,850; plus Interest Earnings $17; less Fees $33; yielding a net balance of $1,208.
  
  
• 61% of accounts in 2009 took a withdrawal of some amount
  
  

2010 National Healthcare Quality & Disparities Reports

Clive Riddle, March 4, 2011

HHS’ Agency for Healthcare Research and Quality (AHRQ) has just issued the 2010 National Healthcare Quality Report and National Healthcare Disparities Report. The reports are published annually, as mandated by Congress since 2003.

AHRQ tells us the “reports show trends by measuring health care quality for the Nation using a group of credible core measures. The data are based on more than 200 health care measures categorized in several areas of quality: effectiveness, patient safety, timeliness, patient-centeredness, care coordination, efficiency, health system infrastructure, and access.”

AHRQ summarizes the report findings as indicating “that few disparities in quality of care are getting smaller, and almost no disparities in access to care are getting smaller. Overall, blacks, American Indians and Alaska Natives received worse care than whites for about 40 percent of core measures. Asians received worse care than whites for about 20 percent of core measures. And Hispanics received worse care than whites for about 60 percent of core measures. Poor people received worse care than high-income people for about 80 percent of core measures. Of the 22 measures of access to health care services tracked in the reports, about 60 percent did not show improvement, and 40 percent worsened. On average, Americans report barriers to care one-fifth of the time, ranging from 3 percent of people saying they were unable to get or had to delay getting prescription medications to 60 percent of people saying their usual provider did not have office hours on weekends or nights. Among disparities in core access measures, only one—the gap between Asians and whites in the percentage of adults who reported having a specific source of ongoing care—showed a reduction.”

My impression of the state of things is evidenced in a section header entitled: “Quality Is Improving; Access and Disparities Are Not Improving.” The report states found that “across all 179 measures of health care quality tracked in the reports, almost two-thirds showed improvement. However, median rate of change was only 2.3% per year. Access is not improving. Across the 22 measures of health care access tracked in the reports, about 60% did not show improvement and 40% were headed in the wrong direction.”

Of course, patterns of care are regional, not national. The report found that “while every State was in the top 10% for some measure and was part of a benchmark, States in the New England (CT, MA, ME, NH, RI, VT) and Pacific (AK, CA, HI, OR, WA) census divisions were benchmark States most often and States in the East North Central (IL, IN, MI, OH, WI), East South Central (AL, KY, MS, TN), and West South Central (AR, LA, OK, TX) divisions were benchmark States less often.

The full 205 page National Healthcare Quality Report addresses: Effectiveness of Care, Patient Safety, Timeliness of Care, Patient Centeredness, Care Coordination, Efficiency of Care, Health System Infrastructure and Access to Health Care. The full 248 page National Healthcare Disparities Report addresses the same topic plus a section on Priority Populations. There is considerable overlap in the content of the two companion reports.

The reports are definitely worth some clicks to check them out.

Looking Backward and Forward at How Industry Insiders View Trends

by Clive Riddle,  February 10, 2011

As part of the annual Future Care Web Summit, attendees as well as MCOL members participate in an e-poll on health care business trends for the coming year. The Tenth annual event concluded two weeks ago, and we’re ready to share results from the survey along with a comparison to responses from previous years for questions that have been asked each year.

Respondents were asked which of the listed health care business trends they thought would have the single greatest overall impact in 2011. This question has been posed annually. Here are the responses for the past eight years:

Trend	2011	2010	2009	2008	2007	2006	2005	2004
Advances in health care technology	8.0%	6.2%	3.4%	11.8%	7.5%	16.6%	13.6%	11.9%
Consumer Driven health plans	7.3%	7.0%	3.4%	13.4%	18.5.%	21.0%	22.7%	14.4%
Compliance issues	4.4%	7.0%	1.1%	0.8%	3.4%	0.8%	0.9%	5.9%
Effects of the Recession	13.9%	26.4%	57.3%	NA	NA	NA	NA	NA
Health Care Reform Initiatives	49.2%	37.2%	21.3%	23.6%	11.0%	28.1%	13.6%	4.3%
Increased consumer cost sharing	11.0%	5.4%	9.0%	33.9%	40.4%	25.8%	38.2%	35.6%
Population Health initiatives	3.6%	5.4%	3.4%	12.6%	7.5%	3.0%	5.5%	23.7%
Other	2.2%	5.4%	1.1%	3.9%	11.6%	4.5%	5.5%	4.2%
Grand Total	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%

One can certainly see the ebb and flow of certain trends over time: the peaking of consumer driven plans and consumer cost sharing after the introduction of HSAs; the realignment of all factors taking back seat to the Great Recession in 2009; and the recent passage of health reform.

While respondents were generally consistent this year regarding these responses by their organization type, there were a few notable exceptions:

• 25% of vendors viewed population health initiatives as the top trend, compared to 1% of all other respondents. 
• 12.5% of providers viewed advances in health care technology as the top trend compared to 4.2% of all other respondents
• 18.7% of providers viewed the effects of the recession as the top trend compared to 9.7% of all other respondents

This year, we asked respondents to rate the ultimate anticipated impact in the marketplace of these selected health reform provisions:

• Accountable Care Organization Development (ACO)
• Health Plan Medical Loss Ratio Regulation (MLR)
• State Health Insurance Exchanges (Exchange)
• Extension of Dependent Care Coverage (Depend)
• EHR Development - Meaningful Use (EHR)
• Health Insurance Guaranteed Issue/ Elimination of Pre-Existing Conditions (Guarantee)
• Expansion of Medicaid Coverage (Medicaid)
• Mandated Coverage Provisions for Business and Individuals (Mandate)

Here’s how these provisions stacked up against each other:

Provision	Significant	Moderate	Little	None/Won't Happen	Unsure
ACO	30.6%	32.1%	23.3%	5.8%	8.0%
MLR	28.4%	38.6%	19.7%	4.3%	8.7%
Exchange	34.3%	36.5%	19.7%	4.3%	5.1%
Depend	22.0%	30.1%	44.1%	2.2%	1.4%
EHR	35.7%	32.8%	23.3%	3.6%	4.3%
Guarantee	37.5%	33.8%	19.8%	5.1%	3.6%
Medicaid	39.5%	41.7%	13.4%	1.4%	3.7%
Mandate	40.1%	35.0%	13.1%	7.3%	4.3%

The Mandate, under attack in federal appeal courts, was drew the highest level of response of any provision in both the Significant and the None/Won’t Happen categories.

Lastly, we asked respondents to rank these stakeholders as winners or losers for the coming year. It would appear Consumers and pharmaceutical organizations are viewed as the biggest winners, and employers and physicians are viewed as the biggest losers.

Stakeholder	Better Off	Same	Worse Off
Consumers	37.0%	26.8%	36.2%
Employers	15.3%	29.9%	54.7%
Health Plans	31.9%	31.2%	37.0%
Hospitals	24.8%	34.3%	40.9%
Physicians	21.2%	29.2%	49.6%
Pharmaceutical	34.6%	42.6%	22.8%

Being that respondents are a bit negative, tending to rank most stakeholders as “worse off” each year, we’ll examine “worse off: responses from a historical perspective for each stakeholder:

Worse Off	Consumers	Employers	Health Plans	Hospitals	Physicians	Pharmaceutical
2011	36.2%	54.7%	37.0%	40.9%	49.6%	22.8%
2010	65.9%	58.1%	55.0%	49.6%	41.1%	20.9%
2009	68.5%	67.0%	54.0%	61.4%	44.8%	35.2%
2008	75.3%	47.4%	12.8%	41.0%	50.0%	16.9%
2007	71.7%	34.9%	11.0%	45.2%	46.9%	29.2%
2006	69.7%	44.7%	45.5%	41.7%	11.6%	17.3%
2005	62.7%	42.7%	34.5%	38.2%	15.5%	25.5%
2004	78.0%	53.8%	33.1%	25.4%	14.4%	15.3%
2004	74.5%	61.8%	35.8%	31.2%	21.0%	13.9%

The historical perspective illustrates how dramatically respondents feel consumers change of fortune as occurred with health reform, compared to everyone else. Also interesting are the mood swings regarding health plan fortunes, and how physicians were seen as taking a turn for the worse starting in 2007.>/p>

For the 2011 Future Care e-poll, there were 137 respondents, consisting of 23% payors, 48% providers, 9% vendors and 20% others.

Diabetes by the Numbers

by Clive Riddle, January 28, 2011

The CDC this week released significant updated data on diabetes in the United States, incorporated into their National Diabetes Fact Sheet 2011. The CDC has announced that 25.8 million American now have diabetes and another 79 million have prediabetes, up from 23.6 million with diabetes and 57 million with prediabetes in 2008.

Ann Albright, Ph.D, R.D., CDC Director of Division of Diabetes Translation tell us "these distressing numbers show how important it is to prevent type 2 diabetes and to help those who have diabetes manage the disease to prevent serious complications such as kidney failure and blindness. We know that a structured lifestyle program that includes losing weight and increasing physical activity can prevent or delay type 2 diabetes."

Here’s a laundry list of diabetes by the numbers from the CDC Fact Sheet and related documents:

• 8.3% of the U.S. population now has diabetes
• 27% of those with diabetes are currently undiagnosed
• About 215,000 Americans younger than age 20 have diabetes. 
• Percentage of adults with diabetes by age group: age 20-44: 3.7%; age 45-64: 13.7%; age 65+ 26.9%
• An estimated 1.9 million Americans were diagnosed with diabetes in 2010, 24% of them age 20-44; 55% of them age 45-64 and 21% age 65+
• 11.8% of men age 20 and older have diabetes, compared to 10.8% of women
• By race, diabetes rates were 16.1 percent for American Indians/Alaska Natives, 12.6 percent for blacks, 11.8 percent for Hispanics, 8.4 percent for Asian-Americans, and 7.1 percent for non-Hispanic whites.
• Reported rates of gestational diabetes range from 2% to 10% of pregnancies. Immediately after pregnancy, 5% to 10% of women with gestational diabetes are found to have diabetes, usually type 2.
• Women who have had gestational diabetes have a 35% to 60% chance of developing diabetes in the next 10–20 years.
• 58% of adults diagnosed with diabetes receive oral medications only; 12% receive insulin only; 14% receive oral meds and insulin; and 16% receive no medications
• Diabetes accounts for 44% of all new cases of kidney failure
• More than 60% of nontraumatic lower-limb amputations occur in people with diabetes
• About 60% to 70% of people with diabetes have mild to severe forms of nervous system damage. 
• Almost 30% of people with diabetes aged 40 years or older have impaired sensation in the feet
• Diabetes is the seventh leading cause of death in the United States. 
• Diabetes costs $174 billion annually, including $116 billion in direct medical expenses

Citation: Centers for Disease Control and Prevention. National diabetes fact sheet: national estimates and general information on diabetes and prediabetes in the United States, 2011. Atlanta, GA: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2011.

Inviting China and other Emerging Countries to a Medical Technology Innovation State Dinner

by Clive Riddle, January 21, 2011

China and other emerging market economies are breathing down the neck of the United States. Look no further than current headlines such as AP’s China's economic might empowers Hu on return U.S. visit, which included the lavish state dinner Hu was denied in his 2006 visit.

Evidently this applies to Medical Technology Innovation as well. PricewaterhouseCoopers (PwC) has just released their Medical Technology Innovation Scorecard, which assesses nine countries’ capacity and capability for medical technology innovation: Brazil, China, France, Germany, India, Israel, Japan, United Kingdom, and the United States.

According to PwC, the “United States continues to lead the world in its capacity to produce the latest in medical technology innovation, but emerging markets led by China, India and Brazil are catching up, and their market power is shifting innovation resources and activity overseas…While the United States is expected to maintain its leadership for the foreseeable future, even a narrowing of the gap has implications for US jobs, exports and Americans’ access to advances in medical technology.”

Michael Swanick, PwC’s US Pharmaceuticals, Medical Device and Life Sciences industry leader tells us “the medical technology field in the US has long benefited from a confluence of social, technical, political and economic forces that came together to create an ecosystem which fosters medical technology innovation. However, the balance of these forces is beginning to change, driven by global economic dynamics, governmental policies and the actions of individual companies and entrepreneurs. As the innovation ecosystem evolves, it creates challenges for those countries and companies that have ridden this wave – and offers opportunities to those, in the US and around the world, who find themselves well-positioned to adapt to new modes of innovation.”

Some key findings PwC has shared include:

• “On a scale of 1 to 9, with 9 as the highest score, the US currently has a total score of 7.1 and is the global leader in medical technology innovation.  Because of decades of innovation dominance, the US continues to show the greatest capacity for medical technology innovation.”

• “The scores of the other developed nations (the UK, Germany, Japan and France) fall within a tight band of 4.8 to 5.4. Among the developed countries included in this study, Germany and the UK demonstrate the strongest support for innovation and Japan the weakest.”

• “Israel, despite its small size, ranks near the level of the European nations, which indicates its strong capacity to foster innovation.”

• “The emerging markets lag behind developed ones. China, with its powerful economic growth engine, scores 3.4, ranking it higher than India and Brazil, each of which scored 2.7.”

• “Looking to the future, the US is expected to continue to lead in medical technology innovation, but also will lose ground to other countries during the next decade.” 

•  Relative declines are projected “for Japan, Israel, France, the UK and Germany. By contrast, China, India and Brazil are likely to see gains during the coming decade.”

• “China, which has shown the largest improvement in its medical technology innovative capacity during the past five years, is expected to continue to outpace other countries and reach near-parity with the developed nations of Europe by 2020.”

But PwC tells U.S. companies that all is not lost. “The shift away from the US to nations such as China, India and Brazil is not necessarily preordained. Factors related to intellectual property protection, difficulty of doing business in some emerging countries and weak local supplier networks could make these markets less attractive, despite their size, and could hinder these nations’ effort to assume innovation leadership.”

Annual U.S. Total Economic Cost of Overweight and Obesity Pegged at $270 Billion

by Clive Riddle, January 14, 2011

The Society of Actuaries this week an 80 page report on their study findings: Obesity and its Relation to Mortality and Morbidity Costs.

The study quantified the following economic impact:

• Total annual economic cost of overweight and obesity in U.S. - $270 billion
• Total annual economic cost in Canada - $30 billion
• Total annual U.S. economic cost of obesity - $198 billion (73% of U.S. total)
• Total annual U.S. economic cost of overweight - $72 billion (27% of U.S. total)

The study also broke down the total U.S. and Canada annual economic cost ($300 billion) by specific causes:

• Total cost of excess medical care caused by overweight and obesity: $127 billion (42.3%)
• Economic loss of productivity caused by excess mortality: $49 billion (16.3%)
• Economic loss of productivity caused by disability for active workers : $43 billion (14.3%)
• Economic loss of productivity caused by overweight or obesity for totally disabled workers: $72 billion (24%)

For the study, lead researchers and actuaries Don Behan and Sam Cox reviewed nearly 500 research articles on obesity and its relation to mortality and morbidity, focusing primarily on papers published from 1980 through 2009.  Don Behan FSA, FCA, MAAA tells us that "there is substantial evidence that overweight and obesity are becoming world-wide epidemics, and are having negative impacts on health and mortality. As actuaries, we are working with the insurance industry to help incentivize consumers through their health plan design to focus on health and wellness, which will hopefully help curb the weight and health problems we face today."

Overweight is defined as a body mass index (BMI) of 25.0 to 29.9 and obese as a BMI of 30.0+.  (Extremely obese is 40.0+). The study cited the following current percentage of population with applicable BMIs:

	USA	Canada	Combined
Overweight	19.2%	17.4%	19.0%
Obese	7.4%	7.6%	7.4%
Extremely Obese	4.2%	4.7%	4.3%

The study goes on to examine the relationships and impact of Obesity with Cardiovascular Disease, Diabetes, Cancer, Osteoarthritis, Asthma, Renal Disease, In-Hospital Infection, and other conditions; as well as disabilities and excess mortality caused by obesity, all from an actuarial perspective.

The study concludes that “perhaps the most convincing results concern the effect of overweight and obesity on cardiovascular disease and diabetes. Relative to normal weight, the relative risk of death from CVD increases significantly for overweight men and women…About 60 percent of diabetes is directly related to weight gain… Several papers provide empirical evidence that obesity is significantly related to increased risk for certain cancers (Renehan et al., 2008b). The relationship is complex and depends on the site of the cancer. Overweight and obesity are significantly related to a variety of negative effects on the body, such as delayed healing of joint injuries, increased risk of arthritis, impaired function of internal organs, and interference with hormone balances. …..The negative effects play a role in a cycle of overweight, depression and decreasing physical activity, which results in increased use of the health care system…Increasing BMI also is related to development of asthma …Many empirical studies found that obesity significantly increases the risk of death, that is, all-cause mortality … The relationship between BMI and all-cause mortality is often found to be U-shaped or J-shaped, since underweight also is associated with increased mortality. The few studies of insured groups generally agree with population results.”

Strategy Makeover for Healthcare in 2011: PwC

by Clive Riddle, December 22, 2010

PricewaterhouseCoopers annually issues prognostication regarding key health care trends for the coming year that are worth taking note of. They’ve just issued a 22 page report in this regard: the Top Health Industry Issues of 2011 which you can download from here.

Here’s the six key trends PwC advises we prepare and position for, in anticipation that “health organizations will undergo a strategy makeover in 2011 as they react to new rules and payment models, continuing cost pressures and new customer demands”:

#1: Booming business in health information technology

#2: Gearing up to redefine health insurance: From MLRs to insurance exchanges

#3: ACOs: Is this the next big thing or not?

#4: Nowhere else to cost shift: Consumers could continue to reduce utilization

#5: M&A: Deals will bond the familiar and unfamiliar as organizations look to fill strategic gaps

#6: Follow-me healthcare: Patients look to health organizations that are always on

Rather than comment on their thoughts, I’ve chosen to provide a summary of each of the above trends verbatim from PwC:

1. Booming business in Health Information Technology (HIT)

The HIT spending boom is driven by (1) federal requirements that hospitals and physicians meet at least stage one requirements for the meaningful use of electronic health records to qualify for federal stimulus funds in 2011; (2) an aggressive timetable for massive upgrades in back-office infrastructure to comply with new medical coding requirements that will add five times the number of diagnosis and inpatient codes and require providers and payers to use the new HIPAA 5010 electronic transaction format, which will require more than 1,300 system modifications by January 2012; (3) final FDA rules that will require online reporting of adverse events related to medical devices, resulting in possible new tracking technology throughout the supply chain.

Stage one "meaningful use" requirements mean hospitals and physicians must be able to provide patients with an electronic copy of their health record upon request. But consumers are not asking. Nearly half of consumers (49%) surveyed still call their doctor's office to request paper medical records. While the policy goal of EHRs is to allow consumers to participate in shared medical decision-making, only 13 percent of consumers have ever been asked for input into what they would like to see in their electronic medical records or how they would like to use them.

2. Gearing up to redefine health insurance: From MLRs to insurance exchanges

The health reform law now requires health plans to spend a minimum of 80 to 85 cents of every premium dollar on medical care and health care quality improvements, depending on the size of the plan. If health plans spend less than the minimum threshold, they must give customers a rebate beginning in 2012. According to PwC, this would require an unprecedented level of actuarial precision for rate-setting, and insurers may opt to pay rebates rather than under price their products in the first year. Many insurers already are contemplating new pricing and rebate scenarios for group plans. At the same time, many employers are contemplating the advantages of employer-sponsored health coverage as health insurance exchanges come online. PwC anticipates a high level of state legislative activity as employers, health plans and states begin to work together in 2011 to define and develop health insurance exchanges.

3. ACOs: Is this the next big thing or not?

Accountable care organizations have created buzz in the industry that this is the next big thing for population health management. But 2011 could be a make-it-or-break-it year for ACOs depending on Congressional action. In anticipation of new performance payment incentives, health organizations are positioning themselves to participate in ACOs and share risks and rewards of keeping people healthier. While ACOs hold great promise for reduced costs and improved quality, the challenge will be keeping people in the ACO and engaging them to stay healthy, which could be the difference between profit and losses. PwC's research found significant demographic and geographic differences in consumers' willingness to seek all their care within ACO-like organizations, indicating the need for consumer segmentation strategies.

4. Nowhere else to cost shift: Consumers could continue to reduce utilization

Higher health insurance premiums, steeper deductibles and larger coinsurance mean consumers are spending more out of their own pockets for healthcare, and 60 percent of consumers surveyed by PwC expect to pay even more in the future. Yet cost shifting may have reached the end of the line as increased price sensitivity has caused consumers to cut back on utilization. PwC forecasts a trickle down effect, starting with physicians and pharmaceutical companies as consumers reduce office visits and drug spending, followed by reduced sales of other medical products, fewer lab tests, imaging scans and other diagnostics. The danger lies in whether short-term cost avoidance could lead to more expensive conditions long term.

5. M&A: Deals will bond the familiar and unfamiliar as organizations look to fill strategic gaps

Mergers and acquisition activity among all the healthcare sectors are expected to continue to trend upward in 2011. Within the pharmaceutical and life sciences sectors, PwC expects deals to focus on strategic mid-market transactions valued between $100 million to $500 million; international growth could yield larger transactions. Increased consolidation is expected among payers, physicians are aligning with hospitals, hospitals are merging with other hospitals and health systems, and recent deals reflect blurring of the lines between the payers and providers sectors. Competition for acquisitions is likely to come from private equity funds investing in healthcare. Though consumers are wary of the benefits of M&A, many seem open to new provider alliances. Seventy-eight percent of consumers said they would prefer to use a retail clinic partnered with a local hospital for primary care services versus only 22 percent who would prefer an independent company owned by a retail pharmacy.

6. Follow-me healthcare: Patients look to health organizations that are always on

The mobile health market is growing exponentially as health organizations use wireless and remote technology to interact with patients anytime, anywhere. To influence patient outcomes, organizations have to engage patients and understand how to connect with them. Healthcare organizations are spending tons of resources to produce online content, yet PwC found that consumers are three and a half times more likely to go to the media and third-party information service companies for information about treatments and conditions than to any other site, especially pharmaceutical company web sites. Only 11 percent of the people PwC surveyed said they would go to a pharmaceutical company for health information. Pharmaceutical companies have typically been removed from the end user of their product, but by understanding online preferences and adopting multi-channel strategies to meet consumers on their terms, pharmaceutical companies see an opportunity to significantly increase their visibility. 

Ten Key Health Care Business Trends for 2011

by Clive Riddle, December 16, 2010

The time has come to start making a list, and checking it twice. What’s on your list of the trends that will shape how your organization proceeds through the new year? Here’s my take on some key trends that will affect the business of health care in 2011:

1. Impact of Health Reform Backlash:
A Republican House, negative public opinions and a Federal judge’s ruling on mandatingcoverage combine to have an influence on health care reform implementation in 2011.No- there isn’t a feasible way to repeal the Affordable Care Act in 2011, as a number ofRepublicans have called for. However, that doesn’t mean that various aspects of healthreform backlash won’t loom large in further development of implementing regulations,ongoing funding provisions, and how stakeholders react.

2. Medicaid Clout
As employment based health coverage shrank during the past decade, Medicaid grew,particularly once the recession kicked in. The Affordable Care Act turbo chargedprojected Medicaid enrollment for the coming years. Given that health care policy can beoften most effectively be dictated through the role as purchaser, Medicaid has increasingclout to impact policy in 2011 and beyond. Furthermore, the increased enrollment hasmade Medicaid the awakening giant for health plans and provider systems to deal with.Major health plans will increasingly look for Medicaid contracting, market expansionsand plan acquisition opportunities. Major providers will dedicate increased resourcestowards Medicaid delivery systems.

3. ACO Initiatives
No one is waiting to see how Medicare ACO pilots set forth under the Affordable CareAct will turn out. 2011 will witness continued rapid deployment of ACO developmentand operational initiatives in the commercial and Medicaid sectors.

4. ACO Naysayers
There will be a growing groundswell of warnings about getting involved with ACOs.Never has there been swooning in the marketplace over a hot new trend without theaccompanying follow-up of naysayers shortly thereafter attributing all the attention tohype, smoke and mirrors. Quite often, it can be for good reason. But by the end of 2011,we won’t know if that’s the case or not for ACOs.

5. Provider Payment Reform
The provider contracting environment will be subject to much greater change andupheaval in 2011. Whether driven by new delivery system initiatives such as ACOs,medical homes, and integration initiatives; general payment restructuring such as byepisode of care; or network restructuring initiatives such as narrow networks, 2011 willwitness significantly heightened activity.

6. Physician Integration
It isn’t just all about potential ACO development. Whether due to EHR/Meaningful Usepressures, economic pressures, perceptions of the future outlook for health care, and ahost of other factors, physicians in private practice will continue to integrate into largermedical groups, and or with health care systems at an increasing rate in 2011.

7. Wellness Incentives
Find some major employers in 2011 that aren’t deploying health risk assessments andfinancial incentives for employees to engage wellness and lifestyle health care issues,and they most likely are developing plans to do so. Those that are already involved willcontinue to roll out additional programs, particularly seeking how to reach into dependentengagement.

8. EHR Critical Mass
Broadband internet connectivity existed for sometime before it reached enough criticalmass for consumers nationwide to routinely start watching You Tube videos of twoyear olds biting their older brothers’ fingers. In 2011, there will be enough medicalgroups, hospitals, health plans and consumer portals to engage and transact a materialsegment of the consumer population with their health care, and the impact of this ongoingtransformation over time will be immense.

9. Survival of Consumer Driven Plans
HSAs and Consumer Driven Plans were written off by pundits as health care reformcoalesced during the past two years. But the plans are survivors, and reports keep comingout documenting moderate, steady growth, that over time, makes them an importantfactor in the health benefits equation.

10. Era of Uncertainty
There’s so much unknown country to drive through: how much will health carereform backlash affect reform implementation? What will be the specifics of variousimplementing regulations? Will the economy pick up steam or not? How are otherstakeholders going to behave in this environment? Often, with major uncertainties afoot,organizations can tend to hunker down for the time being. But with so much at stake,2011 will require driving forward without an up-to-date road-map.

The Insurance Mandate Conundrum

by Clive Riddle, December 9, 2010

Harris Interactive has just released results from a poll, in conjunction with Health Day, taken post-election that measures current public opinion of health care reform  (the survey involved 2,019 adult respondents online between November 19-23.)

In Harris Interactive’s words, “Americans remain deeply divided over the nation's new health-care reform package.” Certainly a plurality (40%) want to repeal all or much of the legislation. But just as polls consistently show that while American’s hate Congress in general, they typically support their own congressman; this poll indicates much of the specifics of health care reform are rated much higher than the package in general.

Humphrey Taylor, chairman of The Harris Poll, tells us "many Americans want to repeal the bill not because they dislike the specifics, but because they feel it is an expensive expansion of an already big government…. Pluralities want to repeal all or most of the law, but want to keep much of what's in it…. it's easy to believe all the bad things about the law if you don't know what's in it."

Expanding on that last point, Sara Collins, vice president for Affordable Health Insurance at The Commonwealth Fund, tells us "I think this suggests that as the public becomes more familiar with the law and how it will benefit them and their families, support will probably climb. There's just a lag while immediate provisions are rolling out like young adult coverage."

But here’s the rub: the public really, really doesn’t like the insurance mandate provision, and time probably won’t improve opinion in that area. So if the a Republican House feels pressure to take some action regarding health reform, given the unlikelihood of pushing through an outright repeal through a Democratic Senate or overcoming the President’s veto, their point of attack would be the insurance mandate.

Yet the mandate is the one provision that helps the more publicly popular provisions, such as guaranteed issue and adult dependent coverage, pencil out a little better (by decreasing adverse selection) for the health plan industry that in many cases lobbied for the Republican party in November. So the party that health plans wished for may cause them to remember the phrase, be careful what you wish for.

Here are some of the poll results by the numbers:

• 40 percent of adults wanting to repeal all or most of the legislation;  31 percent favor keeping all or most of the reforms; 29 percent aren't sure what should be done.
• 57% oppose the insurance mandate and only 19 percent support it
• Two-thirds of respondents like guaranteed issue provision (prohibiting denial of coverage to people with pre-existing medical conditions.)
• 60% want to keep the provision for tax credits so small businesses can afford coverage for employees. 
• 55% like provision allowing children to stay on their parents' insurance plans until they are 26. 
• Just over half of respondents support the idea of new insurance exchanges where people can shop for insurance.
• 81% believe reform will it result in higher taxes, could lead to rationing of health care (74%), and reduce the quality of care they will receive (77%).

Let’s Move to the Atlantic Seaboard or North Dakota: State Specific Premium and Deductible Data

by Clive Riddle, December 3, 2010

The Commonwealth Fund has just released a report with state specific premium and deductible trends for the past seven years: State Trends in Premiums and Deductibles, 2003–2009: How Building on the Affordable Care Act Will Help Stem the Tide of Rising Costs and Eroding Benefits.

The talking points the Commonwealth Fund promotes in conjunction with the report: (Premiums increase 41%! Deductibles increase 80%) are a little disingenuous as those percentages cover a seven year period (which they dutifully note) but the average ready typically relates such percentages into annual terms, and headlining the equivalent average annual increase could have been more meaningful.

The Commonwealth Fund’s theme from their report is, as Commonwealth Fund Senior Vice President Cathy Schoen tells us, “private insurance costs have been increasing faster than working family incomes. For more than a decade, families with job-based insurance have been sacrificing wages to hold on to health insurance. The good news is that the Affordable Care Act reforms provide a foundation to improve coverage and slow health care cost growth in the future."

Regardless of what conclusions you draw from the 32 page report, it contains great state specific data on average health plan single and family premiums and deductibles, further broken down by employer size. They also examine premium as a percent of median household income. The report goes on to project future increases, with and without the impact of the Affordable Care Act, thus indicating projected savings from the Act.

The report notes “by 2009, the average employer-sponsored family premium across all states was $13,027, ranging from $14,000 to $14,700 in the six highest states….to $11,000 to $12,000 in the 11 states with the lowest average private-employer family premium costs…. Average family premiums in the highest-premium-cost states were about 23 percent above those of the lowest-cost states….. By 2009, there were 15 states in which the average annual premium for family coverage equaled 20 percent or more of median household income for the under-65 population, compared with just three states in 2003 ….  In 28 states, family premiums relative to incomes averaged 18 percent or more for middle-income, under-65 households.”

The report found that U.S. average deductibles by firm size were:

Small Firm Single Deductible: $    703 in 2003 / $ 1,283 in 2009
Large Firm Single Deductible: $    452 in 2003 / $    822 in 2009
Small Firm Family Deducible: $ 1,575 in 2003 / $ 2,662 in 2009
Large Firm Family Deductible: $   969 in 2003 / $ 1,610 in 2009

Here’s some interesting state-specific data from the report. From an affordability standpoint (premiums as a percent of income) the Atlantic seaboard or North Dakota may be your best bet.

Five Highest Family Premium States

(2009 Data: US Annual Average $13,027)
Massachusetts: $14,723
Wisconsin: $14,656
Vermont: $14,558
Wyoming: $14,319
District of Columbia: $14,222

Five Lowest Family Premium States

(2009 Data: US Annual Average $13,027)
Arkansas: $10,969
Montana: $11,365
Oklahoma: $11,417
North Dakota: $11,590
South Dakota: $11,596

Five Highest States: Avg Premiums as % of Median Household Incomes

(2009 Data: US Annual Average 18.7%)
Mississippi: 24.6%
Texas: 21.9%
Louisiana: 21.6%
New Mexico: 21.5%
North Carolina: 21.2%

Five Lowest States: Avg Premiums as % of Median Household Incomes

(2009 Data: US Annual Average 18.7%)
Connecticut: 14.6%
New Jersey: 14.7%
Maryland: 15.0%
Virginia: 15.0%
North Dakota: 15.5%

Accountable Care Organizations in California: Lessons Learned

by Clive Riddle, November 10, 2010

While attending the recent Accountable Care Congress in Los Angeles, I had the pleasure of hearing Accountable Care Congress give a presentation on the recently released Integrated Healthcare Association white paper on Accountable Care Organizations in California. I highly recommend you check out the document at: http://www.iha.org/pdfs_documents/home/ACO_whitepaper_final.pdf

The 32 page report includes some great data and discussion, and makes the following nine points regarding lessons learned from the California experience to date:

1. A variety of organizational structures are effective at delivering high quality coordinated care; at least as important to success as structure are an organization's capabilities, culture, and infrastructure, as well as the alignment of goals between the organization and its individual physicians.
2. In California, a range of relationships exist between physician organizations and hospitals. Alignment of incentives between physician organizations and hospitals offer important opportunities for performance improvements across the entire continuum of care.
3. As a method of payment, capitation can be effective at encouraging coordinated care, but payment methods should vary across ACOs depending on an organization's ability to assume risk. Fee-for-service payment with shared savings has not proven a successful incentive for the efficient delivery of care.
4. Health plans acting in concert on payment methods and performance measurement helped facilitate the growth of California's provider organizations, and should also play an integral part in fostering ACO development nationally.
5. ACOs are not a panacea for health care spending control. Some large provider organizations have gained bargaining power and raised prices. Capitation payment and consumer cost sharing partially offset tendencies toward raising prices.
6. ACOs must be agnostic to insurance type; most provider organizations in California have focused on commercial, Medicare, and Medicaid HMO plans for their patients, but for ACOs to be viable across the country, mechanisms must be found to encourage PPO and traditional Medicare and Medicaid patients to use their services.
7. Balancing patient choice with the desire to decrease costs and effectively coordinate care is difficult. California's experience underscores the challenge of promoting care coordination in an environment of unrestricted provider choice.
8. Regulation of the financial solvency of provider organizations is important to ensure market stability.
9. Consumer protections from capitated provider organizations need to be balanced, not overburdening.

Hospital Mortality at Five Star versus One Star Facilities

by Clive Riddle, October 22, 2010

HealthGrades, which touts itself as the “leading independent healthcare ratings organization” has just released a study of patient outcomes at U.S. hospitals, stratified by their ratings, that found “patients at 5-star rated hospitals had a 72% lower risk of dying when compared with patients at 1-star-rated hospitals.”

Other well known ratings and ranking of U.S. hospitals include the U.S. News and World Report rankings of U.S. Best Hospitals, which is based on AHA data in part. Consumer Reports also offers hospital ratings based on results from CMS’ Hospital Consumer Assessment of Healthcare Providers and Systems survey, known as HCAHPS, and CMS directly offers Hospital Compare at Medicare.gov, also providing HCAHPS results.

The Thirteenth Annual HealthGrades Hospital Quality calculated that if all hospitals performed at the level of their 5-star rated hospitals, 232,442 Medicare lives could potentially have been saved from 2007-2009 (the study period.) The study analyzed mortality and complication rates using 40 million hospitalization records obtained from CMS.

The study found overall hospital mortality rates declined by 7.98% from 2007 to 2009. Of the 17 mortality-based diagnoses and procedures analyzed, two experienced increased mortality rates – gastrointestinal surgeries (+8.76%) and coronary intervention procedures (+9.26%). HealthGrades rated individual hospitals with a 1-star (below average), 3-star (average) or 5-star (outperformed national average) rating in each of 26 procedures and diagnoses, from bypass surgery to total knee replacements.

Other findings released from the study included:

• The highest unadjusted mortality rates are among sepsis, respiratory failure, and gastrointestinal surgeries and procedures (20.59%, 19.45%, 10.29%, respectively).
• The most improvement in unadjusted mortality was seen in chronic obstructive pulmonary disease (18.73%), bowel obstruction (14.72%), heart attack (13.68%), and stroke (13.50%).
• Approximately 55.91% (129,949) of the potentially preventable deaths were associated with just four diagnoses: sepsis (48,809); pneumonia (29,017); respiratory failure (26,361); and heart failure (25,762).
• On average, one in nine patients developed a hospital-acquired condition, across the nine procedures evaluated for inhospital complications, from 2007 to 2009.

On average, a typical patient would have a 80.40% lower risk of developing one or more inhospital complications by going to a 5-star rated hospital compared to a 1-star and a 63.64% lower risk of developing one or more inhospital complications by going to a 5-star compared to the U.S. hospital average.

The State of Health Care Quality 2010

By Clive Riddle, October 15, 2010

NCQA has released their annual quality report:  The State of Health Care Quality 2010: Reform, The Quality Agenda and Resource Use.  The 162 page report provides their annual analysis of quality measures and data from over 1,000 health plans that represent 118 million U.S. members.

This year’s report addresses the concept of Relative Resource Use (RRU): which “indicates how intensively health plans use health care resources (such as physician visits and hospital stays), compared with other plans in the same region, serving similar members. When used alongside quality measures, RRU makes it possible to talk about quality and cost simultaneously. Given the definition of value as the intersection of health plans’ spending (resource use) and their results, RRU reveals the value that plans offer.” NCQA analysis found that “many plans that deliver below-average quality use above-average levels of resources. More care is not always linked to better results.”

Another significant issue raised in the report was that commercial plan 2009 childhood vaccination rates dropped almost four percentage points. NCQA speculates that “a possible cause of this drop is commercial plan parents may refuse vaccines for their children based on the unproven, but increasingly popular, notion that vaccines cause autism. Celebrity activists are outspoken advocates of this view. Interestingly, we see vaccination rates in Medicaid – the program serving the poor – continuing to steadily improve. “  NCQA President Margaret O’Kane tells us “The drop in childhood vaccinations is disturbing because parents are rejecting valuable treatment based on misinformation. All of us in health care need to work together to get better information to the public.”

The report also measures the state of the states, indicating the top ten and bottom ten states for quality, based on four measures for ranking

1. Comprehensive Diabetes Care (ten indicators)
2. Controlling High Blood Pressure (one indicator)
3. Persistence of Beta Blockers After a Heart Attack
4. Cholesterol Management for Patients with Cardiovascular Conditions (two indicators)

States included in the Top Ten, based on mean of rates: CA, IA, MA, MN, ND, NH, OR, SD, VT, WU

States included in the Bottom Ten, based on mean of rates: AK, AL, AR, DE, LA, MS, NC, OK, SC, TN

NCQA/Consumer Reports 2010 HMO Rankings

By Clive Riddle, October 7, 2010

NCQA has released its rankings of HMO and Point of Service plans around the nation for 2010, via Consumer Reports.

According to NCQA, themeasures and methodology used to rank plans did not change from 2009. Details on the methodology and guidelines are listed at http://www.ncqa.org/rankings .

Below are the top ten ranked private plans (excluding Medicaid and Medicare plans). You will note that regional and non-profit plans (vs. national for-profit) and integrated plans are well-represented.

NCQA 2010 National Ranking of HMOs: Top Ten Private Plans

1. Harvard Pilgrim Health Care (MA, ME)
2. Tufts Associated Health Maintenance Organization (MA, RI)
3. Harvard Pilgrim Health Care of New England (NH)
4. Capital Health Plan (FL)
5. Geisinger Health Plan (PA)
6. Grand Valley Health Plan (MI)
7. Group Health Cooperative of South Central Wisconsin (WI)
8. Fallon Community Health Plan (MA)
9. Kaiser Foundation Health Plan of Colorado (CO)
10. Health New England (MA)

Source: Consumer Reports: The 2010 rankings of HMOs from the National Committee on Quality Assurance

Source URL: http://www.consumerreports.org/health/insurance/best-health-insurance-privateRatings-1.htm

Notes: Private plans exclude Medicaid and Medicare.  This year, the NCQA ranked 227 HMOs and point-of-service plans with a total enrollment of about 42 million. Not all HMOs are on the list; some do not submit data to the NCQA, or submit insufficient data, and others decline to make it public.

Kaiser Permanente Goes “Open Source” With Their Internal Medical Terminology

by Clive Riddle, October 1, 2010

In Meaningful Use news, Kaiser Permanente has announced that they are donating their “Convergent Medical Terminology (CMT) to the International Healthcare Terminology Standards Development Organisation (IHTSDO©) for U.S. distribution through the U.S. Department of Health and Human Services (HHS) so that all health care providers—large and small—can benefit from the translation-enabling technology.”

The stated objective is to make KP’s experience and formerly proprietary system available to help U.S. health professionals and hospitals achieve key meaningful use standards set forth by the Office of the National Coordinator of Health IT and the Center for Medicare and Medicaid Services.

HHS Secretary Kathleen Sebelius has commented that “one of the key challenges to achieving a coherent health record for every U.S. consumer is the need for consistent data across all systems and institutions. This donation of the Convergent Medical Terminology from Kaiser Permanente addresses that critical need by making it easier for health professionals and patients to create standardized data in electronic health records."

Jack Cochran, MD, Executive Director of The Permanente Federation added that “utilizing a common terminology that translates complex medical concepts into language that is both clinician- and patient-friendly has helped us coordinate teams, improve the quality of care for our patients and enhance efficiency in our organization. We would like to share the tool we developed with the country."

Kaiser’s system involves “the production of structured health data by creating and linking clinician- and patient-friendly terminology to the health data standards now required for U.S.-wide use. The Convergent Medical Terminology[CMT] has been developed by clinicians and technologists over many years. It is in active use to document thousands of patient encounters every day.”

Kaiser Permanente's CMT donation incorporates the following:

• terminology content KP has already developed
• a set of tools to help create and manage terminology,
• processes to control the quality of terminology that is developed.
• mappings to classifications and standard vocabularies, such as the Systematized Nomenclature of Medicine – Clinical Terms (SNOMED CT©) already accepted by U.S. and international health policy makers

Kaiser provided the following additional information about their CMT system:

• CMT is used in the underlying architecture of Kaiser Permanente's HIT systems to support data flow between health care providers. It provides mapping to standardize the use of terminology and ensure systems, some already in use in most U.S. medical offices, can talk to each other effectively. The utilization of CMT will support a common set of medical concept descriptions so that one doctor's diagnosis can be reconciled with another's. CMT includes the key taxonomies required for stage one of the Meaningful Use program such as problem list sets in SNOMED CT. Thus, it can help clinicians map to the standards set forth by the Office of the National Coordinator of Health IT and the Center for Medicare and Medicaid Services.

• CMT is a core component of Kaiser Permanente's comprehensive electronic health record, KP HealthConnect®, helping physicians communicate with their patients more clearly. KP HealthConnect is the world's largest private electronic health record, connecting more than 8.6 million people to their physicians, nurses, and pharmacists, personal information, and the latest medical knowledge.

• CMT is also utilized by Kaiser Permanente's personal health record, My Health Manager, on kp.org so that patients can get a better understanding of their medical care. My Health Manager provides patients with secure, timely access to their lab test results, medication information and refill capabilities, summaries of their health conditions, and other important health information at just the click of a mouse. The technology empowers patients to manage their health by allowing them to access health information and tools and securely e-mail their doctor.

World Alzheimer's Day- September 21st

by Clive Riddle, September 21, 2010

In observance of World Alzheimer's Day, Alzheimer’s Disease International has issued the World Alzheimer Report 2010. Here’s ten quick facts we gathered from the report:

1. There are 35.6 million people living with dementia worldwide in 2010
2. The total estimated worldwide costs of dementia are US$604 billion in 2010
3. Total dementia costs account for around 1% of the world’s gross domestic product
4. The total estimated worldwide costs of dementia are US$604 billion in 2010
5. Direct medical costs account for 16% of total dementia costs
6. Direct social care costs account for 42% of total dementia costs
7. Costs of informal care (unpaid care by families, etc.) account for 42% of total dementia costs
8. About 70% of worldwide dementia costs occur in Western Europe and North America
9. If dementia care were a country, it would be the world’s 18th largest economy, ranking between Turkey and Indonesia
10. If dementia were a company, it would be the world’s largest by annual revenue, exceeding Wal-Mart (US$414 billion) and Exxon Mobil (US$311 billion).

Dr Daisy Acosta, Chairman of Alzheimer’s Disease International tell us,. "this is a wake-up call that Alzheimer’s disease and other dementias are the single most significant health and social crisis of the 21st century. World governments are woefully unprepared for the social and economic disruptions this disease will cause."

Here, verbatim, is what the report recommends at this point in time:

• Governments worldwide should act urgently to make Alzheimer’s disease a top priority and develop national plans to deal with the social and health consequences of dementia. Several countries have moved forward to develop national plans, including France, Australia and England. It is critical for other governments to follow suit.
• Governments and other major research funders must increase research funding to a level more proportionate to the economic burden of the condition. Recently published data from the UK suggests that a 15-fold increase is required to reach parity with research into heart disease, and a 30-fold increase to achieve parity with cancer research.
• Governments worldwide must develop policies and plans for long-term care that anticipate and address social and demographic trends and have an explicit focus on supporting family caregivers and ensuring social protection of vulnerable people with Alzheimer’s disease and other dementias.
• The scale of what is facing us elevates this to a global challenge, which must be addressed as a top WHO priority and on the G-20/G-8 agenda.

Analytics in the People's Republic of China

By Clive Riddle, September 17, 2010

 This week, the National Predictive Modeling Summit was held in the Washington DC area. During the Thursday afternoon workshop on International Analytics issues, Rong Yi, PhD, Senior Consultant at Milliman, Inc. gave a presentation on Predictive Analytics and the People's Republic of China.

Here’s some of what Rong had to share on health care and analytics in the People's Republic:

• 22% world’s population, 2% world’s health care resources.
• China’s health care spending is 4.7% of GDP.
• 2/3 of the population are in the rural area, supported by only 20% of health care resources.
• Chronic conditions account for 80% of deaths in China
• Hypertension: 18.1% of population (160 mil), increased by 33% in 10 years.
• Diabetes: 9.7% (92 mil) adult diabetes, 15.5% (148 mil) prediabetes.
• Overweight and Obesity: 8.1% children age 7-17, 22.4% adults
• 14 different ministries and commissions are involved in China’s public health and healthcare policymaking
• Rural Coverage: the New Cooperative Medical System started in 2003,  with 100% reach at village level as of 2010
• Urban Coverage: Workers medical insurance started in 1998; Residents medical insurance started in 2007
• Private insurance: Chinese insurers dominant, foreign insurers 5% in market share; Starting in 2011 foreign insurers are allowed to enter the China market for individual and group health insurance
• Reform includes an investment of 2,000 new hospitals in 2009-2012; 3,700 new community health services centers, and 11,000 new community health services stations
• State of Predictive Analytics:  (1) No claim-based predictive modeling at the present time; (2) commercial use of scoring methods and HRA tools include-  HRA research committee under China’s CDC, Proprietary HRA tools developed on China’s data, and specific scoring tools, e.g., ICU scoring systems, disease-specific scoring; (3) Disease risk prediction models based on health screening data on large population in which long term risks are modified using long-term factors such as lifestyle and behavioral factors (smoking, exercise)