Fifteen Things to Know from the 2019 America’s Health Rankings Report

By Clive Riddle, December 6, 2019

Vermont is number one in health, Mississippi is in last place, and New York gets most improved. Smoking is down, obesity is up, along with diabetes, drug death, and suicides. Fortunately the supply of mental health providers is increasing as well. These indicators and countless more come courtesy of the 2019 America’s Health Rankings Annual Report.

 

The United Health Foundation, affiliated with UnitedHealth Group, has released their 118-page 2019 America’s Health Rankings Annual Report, marking their 30th annual study that "has grown from ranking states across 16 measures of health to 35 measures in 2019." This year’s report was developed in partnership with the American Public Health Association.

The Foundation share these key findings from their report:

1. In the past year, improvements have been made in lowering the rates of smoking (decreasing 6%), children in poverty (decreasing 2%), and increasing the supply of mental health providers (increasing 5%).
2. In the past two years, infant mortality has declined, resulting in 1,200 fewer deaths (decreasing 2%).
3. Obesity prevalence among Americans is now at 30.9%, up 11% since 2012.
4. Diabetes is now at 10.9% of the U.S. population, up 4% in the past year.
5. The rate of drug deaths increased 37% from 14.0 to 19.2 deaths per 100,000 – equating to more than 53,000 additional deaths over a three-year period.
6. The suicide rate increased 4% nationally in the past year, and is up in a total of 30 states.
7. Smoking among adults has decreased 45% since 1990. Today, 16.1% of adults report that they smoke.
8. Infant mortality has decreased 43% since 1990, with declines in all 50 states.
9. Obesity has increased 166% over the past 30 years, from 11.6% to 30.9%.
10. Diabetes has reached the highest prevalence since 1996, increasing 148% among adults.
11. The national suicide rate has increased 17% since 2012.
12. Drug deaths have increased 104% since 2007.
13. Vermont topped the list of healthiest states in 2019, followed by Massachusetts (No. 2), Hawaii (No. 3), Connecticut (No. 4) and Utah (No. 5).
14. Mississippi ranks No. 50 this year, followed by Louisiana (No. 49), Arkansas (No. 48), Alabama (No. 47) and Oklahoma (No. 46).
15. New York has made the most progress since the Annual Report was first released in 1990, improving 29 ranks from No. 40 to No. 11.

A Current Snapshot of Medicare Advantage, PDP Medicare Employer Group Enrollment

by Clive Riddle, November 22, 2019

As of November, Medicare Advantage now serves 22,584,367 enrollees. Another 709,746 are enrolled in related plans (Dual, Cost and PACE), for a total of 23,294,113 Medicare enrollees in managed plans. 88.3% of these total managed enrollees have Prescription Drug Plan coverage. Another 25,626,600 Medicare enrollees not in managed plans have PDP coverage.

14.1% of Medicare Advantage enrollees are in Special Needs Plans. 20.1% of Medicare Advantage enrollees are in Employer Plans. 18.5% of Medicare PDP only enrollees are in Employer Plans. Below is the CMS November 2019 enrollment contract summary report: 

Speaking of Employer plans, Mark Farrah Associates has just released a brief: Trends in Employer Group Medicare Advantage Enrollment. For the employer group segment, they identified the top five MA payers by group enrollment (Oct. 2019 data) to be:

• UnitedHealth: 1,387,052
• CVS/Aetna: 913,490
• Kaiser: 550,331
• Humana: 510,956
• BCBS Michigan: 378,890

These top five payers comprise 83.7% of total Employer Group MA enrollment, and “all 5 of the leading group MA health plans achieved double-digit growth in membership since December 2016.” Enrollment is also concentrated by state, with the top ten states (20% of the states) comprising 63.9% of Employer Group MA enrollment, with California on top with 622,404 enrollees followed by Michigan with 405,415.

Overall, they note that “employer group MA enrollment has increased by almost 321,000, a 7.7% increase, since December 2018. Moreover, group market enrollment has increased by approximately 1.3 million members since December 2016.”

Affordability and Coverage of Prescription Drugs for Seniors: A Gallup Poll and a KFF Study

by Clive Riddle, November 15, 2019

West Health and Gallup have just released results from a new survey on healthcare costs that found 13.4% of U.S. adults had “a friend or family member [who] passed away after not receiving treatment for their condition due to their inability to pay for it.” That percentage decreases with age: 16.9% under age 45, 12.4% between age 45 and 64 and 6.6% age 65%+  knew someone passing away.

That might seem counter-intuitive, given the greater frailty of seniors, but greater income levels compared to those under age 45, combined with stable coverage (Medicare) factor in. By income the percentages were 18.5% under $40k annually, 11.1% between $40k to $100k, and 9.1% over $100k.

Prescription drugs pricing was a particular focus in the survey, and “89% of U.S. adults report that drug prices are either ‘much higher’ or ‘somewhat higher’ than what consumers should be paying for them.” The survey found “28% of women vs. 18% of men have been unable to pay for prescription drugs;’ and that “medication insecurity skyrockets to 42% among those with annual household incomes of under $40,000.”

Today’s seniors have something the previous generation did not –the availability of  Medicare prescription drug coverage to help insulate from drug costs, and Kaiser Family Foundation has just released a new study: Medicare Part D: A First Look at Prescription Drug Plans in 2020.

Here’s eight things to know from KFF’s study:

1. The average Medicare beneficiary will have a choice of 28 PDPs in 2020, a 29% increase from 2017
2. A total of 948 PDPs will be offered in 2020, an increase of 202 PDPs since 2017.
3. Among the 20 PDPs available nationwide, average premiums will range sixfold from a low of $13 per month for Humana Walmart Value Rx Plan to a high of $83 per month for Express Scripts Medicare Choice.
4. Two-thirds of Part D enrollees without low-income subsidies will have premium increases in 2020 if they stay in their same plan, and one-third will have premium decreases.
5. The estimated national average monthly PDP premium for 2020 is projected to increase by 7% to $42.05
6. In 2020, all PDPs will have a benefit design with five or six tiers for covered generic, brand-name, and specialty drugs, and cost sharing other than the standard 25% coinsurance, similar to 2019.
7. 86% of PDPs will charge a deductible, with most PDPs charging the standard deductible of $435 in 2020.
8. Among all PDPs, median cost sharing is $0 for preferred generics and just $3 for generics, but $42 for preferred brands and 38% coinsurance for non-preferred drugs plus 25% for specialty drugs

Telling Tooth to Power: J.D. Power 2019 Dental Plan Satisfaction Report

by Clive Riddle, November 8, 2019

J.D. Power has just released its 2019 Dental Plan Satisfaction Report, which found that “customer satisfaction with dental plans increased in 2019, driven by year-over-year increases in coverage and communication experience,” with an overall satisfaction score in 2019 of 772 (on a 1,000-point scale) increasing from 768 in 2018.

The study found that DentaQuest (810 score) ranks highest, Blue Cross Dental/Blue Shield Dental (806 score) ranked second and HumanaDental (780 score) ranked third. The study noted “while most dental care providers included in the study typically provide insurance coverage through the customers’ employer, DentaQuest largely provides government plans.” Their report is based on survey responses from 1,400+ dental plan members.

The Kaiser Family Foundation Employer Health Benefits 2019 Annual Survey found that “among firms offering health benefits in 2019, 59% of small firms and 92% of large firms offer a dental insurance program to their workers separate from any plan included in their plan,” and that “sixty­three percent of firms offering a dental program to their workers make a contribution toward the cost of the coverage.”

The recently released 2020 Segal Health Plan Cost Trend Survey found that dental PPO plans were projected at 3.8% premium increases, dental maintenance organization plans at 3.5% increases, dental reference priced plans at 3.0% and dental FFS/indemnity plans at 4.1% increases. The report notes that dental benefits have "remained relatively unchanged for decades."

Here are the detailed results from the J.D. Power Dental Plan Satisfaction Report:

Measuring Telehealth Satisfaction: J.D. Power Study Finds Early Adopters Love It

by Clive Riddle, November 1, 2019

Telehealth use has progressed to the point where J.D. Power now has added the category to items included in their consumer satisfaction studies. The J.D. Power 2019 Telehealth Satisfaction Study finds that while “nationwide consumer adoption of telehealth services has been stubbornly low, with just 10% of healthcare consumers having used such services,” among those early adopters who are using telehealth, customer satisfaction with the experience ranks among the highest of any consumer category studied by J.D. Power.”

Greg Truex, Managing Director, Health Intelligence at J.D. Power offers this perspective: “Early attempts at trying to convince consumers to bank via their phone failed, and initiatives were abruptly canceled. Now, with mobile banking apps having grown to become the third-most-used application among consumers, we expect telehealth to follow a similar path. Telehealth offers an alternative avenue to receive quality care that is cost efficient and accessible. Once providers and payers refine the formula for awareness and adoption, telehealth will change the landscape of how affordable and quality care is delivered.”

J.D. Power found “the overall customer satisfaction score for telehealth services is 851 (on a 1,000-point scale), and is 900 or higher among 46% of telehealth users.,” and that “these customer satisfaction scores are among the highest of all healthcare, insurance and financial services industry studies conducted by J.D. Power. Only direct banking customer satisfaction ranks higher, with an average score of 855.”

Among direct-to-consumer brands, Teladoc ranked highest with a score of 870. Followed by Doctor on Demand (867) and MDLIVE (847). Among payers of health plan-provided telehealth services, Humana ranks highest with a score of 864, followed by Kaiser (863) and Cigna (862).

 

Additional J.D. Power study findings included:

• 65% of telehealth users used the service because they received a positive recommendation from others, including friend, family or colleague (22%); health plan (21%); primary care doctor (20%); employer (18%); or health plan, hospital, or another provider (15%).
• Among consumers who have not used telehealth, 29% indicate that telehealth is not available to them and 37% say they do not know if it is offered by their health provider or health system.
• Self-reported availability is lowest in rural areas (25%).
• 84% of telehealth users were able to completely resolve their medical concern(s) during their visit 
• 73% of users did not experience any issues or problems during their service.
• 49% of users say there were no barriers that made using telehealth difficult.
• 87% of users describe the enrollment process as somewhat/very easy.
• Users averaged 44 minutes for their entire experience, including: 17 minutes to complete the enrollment process, 9 minutes to wait for a physician or nurse practitioner and 18 minutes for the actual consultation. 

Thirteen Things to Know About the State of Vaping Use and Healthcare

By Clive Riddle, October 22, 2019

The CDC recently released numbers on vaping prevalence and health issues, which has been compiled along with their Electronic Cigarette Infographic Fact Sheet, to yield these thirteen things to know:

1. As of October 8, 2019, 1,299 confirmed and probable lung injury cases associated with use of e-cigarette, or vaping, products were reported nationally
2. As of that date, 26 deaths have been confirmed in 21 states
3. The median age of patients who have died is 49 years, ranging from 17 to 75 years old.
4. 76% of users reported using THC-containing products, with or without nicotine-containing products;
5. 32% of users reported exclusive use of THC-containing products;
6. 58% of users reported using nicotine-containing products, with or without THC-containing products
7. 13% of users reported exclusive use of nicotine-containing products.
8. 70% of users are male.
9. 80% of users are under 35 years old.
10. 15% of users are under 18 years old
11. 21% of users are 18 to 20 years old.
12. As of 2015, among all adult users 11.4% had never been regular cigarette smokers, but for age 18-24 40.0% had never been regular cigarette smokers
13. In 2018, 4.9% of middle school and 20.8% of high school students had used e-cigarettes in the past    30 days, compared to a 2017 study citing 2.8% of all adults

Healthcare Consumers on Technology and Decision Making: A Dozen Things To Know from a UnitedHealthcare Survey

by Clive Riddle, September 27, 2019

As healthcare consumers are about to embark into a decade, a new survey tells us they are turning even more to technology for health information, decision-making and purchasing. UnitedHealthcare has released results from their fourth-annual Consumer Sentiment Survey, which “examines Americans’ attitudes and opinions about multiple areas of health care, including open enrollment preparedness, technology and transparency trends and health literacy.” United tells us the study focuses on three areas: 1) Open Enrollment Preparedness; 2) Technology & Transparency Trends; and 3) Health Literacy & Consumer Preferences.

 

Here’s a dozen takeaways from the survey:

1. A new-high 37% have used the internet or mobile apps to comparison shop for care (14% in 2012), including 50% of Millennials
2. 46% cited a health care professional, such as a doctor or nurse, as the first source of information about specific health symptoms or ailments, and 20% first use the internet or a mobile app
3. 39% who shopped online changed the facility or care provider (or both) as a result
4. 64% “never” know the Rx costs before leaving the doctor’s office; 21%  “sometimes” know and 11% always know the price.
5. 45% said they would be interested in their physician using AI in care decisions (including 55% of Millennials); and 28% were uninterested
6. For those interested in AI support for physicians, 46% were motivated by the potential for a more accurate diagnosis; 31% cited the potential to reduce human error; and 15% hoped for faster treatment decisions
7. 39% would likely use telemedicine in the future to access care (up 2 from 2016)
8. 75% of those with benefits say they are prepared for the fall’s open enrollment season (down 2 points from last year) including 84% of Gen-Xers and 78% of Baby Boomers, but just 69% of Millennials and 44% of Gen-Z.
9. 36% devote less than one hour to open enrollment; 27% spent between one and three hours; and 23% said more than three hours.
10. 55% check if their doctors are in-network for the health plan they intend to select
11. 59% successfully defined plan premium, 53% defined the meaning of deductible, while 335 could define out-of-pocket maximum and 21% define co-insurance
12. 66% preferred speaking directly with a customer service representative to resolve health plan issues; and 10% preferred a self-service option through an app or online.

New Changes in Health Care Executive Pay

The Spring 2019 issue of Warren Salary Surveys is published and there are some interesting findings highlighted here.

Warren is the oldest and largest survey of its kind reporting 600 positions in the health care industry. Large and small health plans, health systems and ACOs are reporting their data every 6 months and the data includes salary, bonus by region and by size and type of plan.

This week saw a report of a large health system in the southwest began to move bonus payments in line with patient engagement. By using HCAPS score improvement as well as patient complaint resolution and satisfaction scoring to create a base formula for bonus pay, the health system is moving towards a more patient centric incentive system.

Signaling further changes in the health care compensation programs offered by Accountable Care Organizations and Health Maintenance Organizations, Warren is observing an increase in compensation for positions such as financial analysts representing a 3.32% increase over 2018 to $68,859 and Underwriters moving to $66,749 as an average reported nationally by over 160 plans over the past year (Collected in spring 2019).

VP of Planning and Development saw a large jump of 5% to $243,181.00 over last year, perhaps revealing more focus on new markets and new products. In the medical management departments, there was an increase in pharmacy service coordinator to $52,457, underscoring for many health plans the need to better manage pharmacy costs especially for Medicare Advantage patients.

The biggest gain was in the position of Clinical Informaticist: a 13% gain to a salary averaging $105,778. These people are very hard to find and several organizations have started to create an internal training program to move some of their health information specialists into affiliated support roles to learn the clinical informatics discipline and support the lead informatics person.

Finally, the newer lead executive positions in Accountable Care Organizations CEO show an average salary of $269,575 with a range of $211,911 in the mountain states to $356,888 in the northeast. The majority of the ACOs reporting were not-for-profit with an average of $280,953 salary. At this point few bonuses have been calculated for the ACO chief executive, but Warren sees the above formula of measuring patient engagement improvements to be a very new but a meaningful way for ACO Boards of Directors and managers to consider these types of incentives to attract and retain talented ACO executives who continue to be elusive in the marketplace.

Further information can be obtained at: www.warrensurveys.com

The Latest on Physician Burnout

By Clive Riddle, August 9, 2019

InCrowd has just released their 16-page 2019 Physician Burnout Survey report - a follow-up to their 2016 burnout research, asking their participating physicians how they’re coping with job-related stress. They found “sixty-eight percent of US-based physicians surveyed reported experiencing burnout at some level,” and that “primary care physicians (PCPs) report higher burnout rates than specialists, with 79% of PCPs personally experiencing burnout compared with 57% of specialists. And, more than a third of InCrowd physicians surveyed said they would not recommend their profession to a young family member.”

The report also shares findings that: 

• Burnout is highest among younger physicians, with those in their 30s and 40s reporting highest rates of burnout (74%), and burnout rates dropping thereafter.
• Hospital employees report slightly worse metrics for addressing burnout (20% effective) compared to those who work across private practices (27% effective).
• Those who report that their facilities effectively address burnout credit workplace initiatives that improve workflow (46%), provide schedule flexibility (45%), and support wellness (41%).
• When asked what actions their facilities could take to alleviate the issue of physician burnout, over half of respondents report that increased support staffing (66%), mandatory vacation time or half-days (57%), and reduced patient volume (56%) are likely to help. 

InCrowd notes their findings are “higher than the 43-54% range found in MedScape’s 2019 national report yet lower than the 80% of The Physicians Foundation/Merritt Hawkins biennial survey of September 2018. With PCPs, however, InCrowd found nearly 80% burnout levels—dramatically higher than the 43.9% cited in an American Academy of Family Physicians (AAFP) study of March 2019, which itself reflected a decline from 54.4% in 2014.”

Last month, Spok, Inc. released a paper: "Clinician Burnout in Healthcare: A Report for Healthcare Leaders" providing survey results from over 470 clinical staff at U.S. hospitals and health systems. in which clinician perception of burnout was measured. 92% of clinicians said burnout is “a public health crisis that demands urgent action.” 

When asked "what prevents clinicians from seeking help for potential symptoms of burnout, the No. 1 obstacle cited by respondents (65%) was that their organization lacks institutional attention and resources. When asked how often their organization leaders discuss burnout, 47% said rarely or never."  When asked "whether increased or ineffective technology contributes to the risk of clinician burnout, the vast majority (90% of all respondents) strongly or moderately agreed. And 89% of respondents said burdensome or increased workload (not related to direct patient care) is the biggest factor that contributes to this risk."

The Spok survey also found:

• 70% experience symptoms of burnout "considerably” or “a great deal.
• 95% believe improving EHR usability will be at least somewhat helpful
• 30% of respondents said their organizations are improving EHR usability
• Nurses use an average of 4.1 technology systems daily 
• Physicians use an average of 3.9 systems daily and clinical leaders 3.5
• 20% reported mental health treatment or support is available
• 13% have a chief wellness officer or equivalent
• 11% reported not experiencing risk factors including work-related stress, lost satisfaction, or a loss of efficacy in their own work

The Spok survey certainly lays much of the problem at the lap of HER. The InCrowd survey asked for suggestions on how to reduce burnout and “more than half (51%) of those providing additional recommendations suggest improving processes related to administrative burden: 23% suggest employing scribes, 23% advocate for reduced documentation, and 5% propose scheduling more time for charting.” 

Two Papers on the Health Plan Medicare Opportunity

By Clive Riddle, August 2, 2019 

Oracle has released an Executive Insight paper on the Opportunity Ahead for Agile and Efficient Medicare Advantage Plans,  cautioning that “While the opportunity is great, MA plans are not automatically a wise or profitable business decision for all health insurers. There is growing competition as new players enter the market, and cost and margin pressures continue unabated. To make the most of this opportunity, MA plans must look to accelerate innovation while optimizing costs across their enterprises— from marketing and enrollment to plan configuration, claims processing, compliance, and renewal.”

They report on three development plans should consider now:

1. It is “Time to flex strength with expanded flex benefits. In 2019, MA plans were cleared to offer new flex benefits, designed to move plans toward expanded population health capabilities.”
2. “MA plans look to differentiate on other fronts and deliver high levels of service—without placing profitability and stability in peril.”
3. Payers are eager to bring new urgency and focus to improving claims accuracy and delivering innovative provider payment models.

HealthEdge has just released results of its Voice of the Market Survey, a study of 201 health insurance executives directly involved in Medicare lines of business. 92% responded that they are trying to grow their Medicare Advantage book of business faster than their traditional Medicare Supplement business.

Here’s some key findings from their survey:

• 53.2% said the value-based model of Medicare Advantage significantly factors into a desire to grow the business, while 42.8% said it moderately factor in.
• Expanding to new service areas ranked first in level of importance as the steps being taken to attract new Medicare and Medicare Advantage members, followed by (2) Appealing to tech-savvy digital consumers; (3) Providing incentives for healthy behaviors; (4) Addressing social determinants of health; and (5) Marketing/advertising to prospective members
• Applicable steps above get re-ordered somewhat when ranking importance to retain current Medicare and Medicare Advantage members: (1) Appealing to tech-savvy digital consumers; (2) Addressing social determinants of health; (3) Providing cost transparency; (and 4) Providing incentives for healthy behaviors; (5) Providing education services to members about their benefits
• There is not consensus on what is the biggest challenge to acquiring new members in the Medicare or Medicare Advantage (MA) line of business.  29.4% said it was funding/executing marketing outreach to  attract new members; 23.8% said competitors who  dominate the market; 22.4% said offering the variety of  plans necessary to satisfy members; and  19.9% answered differentiating  between MA and  traditional Medicare.
• When asked “what is the biggest external challenge your organization faces in the Medicare and Medicare Advantage line of business.” Competitors seem top of mind, with 34.3% responding “competition”; and another 29.9% stating “members unwilling to switch plans from a competitor. Other responses were 19.9% replying “regulations” and 15.9% saying “member demands.”

Overconfident Healthcare Organizations? Could Be According to Healthcare Cybersecurity Survey

By Clive Riddle, July 19, 2019

LexisNexis Risk Solutions in collaboration with Information Security Media Group has released results from their recent survey of hospitals, medical groups and payers, in their new 18-page report The State of Patient Identity Management, which found 50% are confident they have the necessary controls in place to prevent unauthorized access to patient information, 58% believe their portal cybersecurity is above average (and only 6% feel they are below average), yet 35% don’t deploy multifactor authentication.

To digress, some insight into those results can be gained from reading last week’s mcolblog post by Kim Bellard on Our Dinning-Kruger Healthcare System, which discusses the Dunning Kruger effect involving “the cognitive bias that leads people to overestimate their knowledge or expertise,” illustrated in the world of NPR’s Lake Wobegon – where “all the children are above average.” 

88% of the organizations surveyed had patient/member portals, and 93% use username and password as the patient portal authentication method. 65% deploy multifactor authentication, with 39% using a knowledge-based Q&A for verification, 38% using email verification, and 13% deploy device identification. 65% report that their individual state budgets for patient identity management will not increase in 2019.

Here’s the top three cybersecurity takeaways of the report according to LexisNexis:

1. Traditional authentication methods are insufficient: As a result of many healthcare data breaches, hackers have access to legitimate credentials; users are also easily phished. Therefore, traditional username and password verification are considered an entry point, not a barrier, and alone cannot be relied upon to provide a confident level of security.
2. Multifactor authentication should be considered a baseline best practice: HCOs should rely on a variety of controls, ranging from knowledge-based questions and verified one-time passwords to device analytics and biometrics to authenticate users based on the riskiness of the transaction. The more risky the access request is, the more stringent the authentication technique should be.
3. The balance between optimizing the user experience and protecting the data must be achieved in an effective cybersecurity strategy: HCOs need to make it easy for patients and partners to access records while ensuring adequate data protection. To do this, an HCO's cybersecurity strategy should layer low to no-friction identity checks up front, making it easier for the right users to get through and layer more friction-producing identity checks on the back end that only users noted as suspicious would complete.

Ten Takeaways From PwC’s Medical Cost Trend Behind The Numbers 2020

By Clive Riddle, June 21, 2019 

PwC's Health Research Institute has just released their 14th annual report on medical cost trends: Medical cost trend: Behind the numbers 2020, which projects the 2020 trend to be a six percent cost increase. As PwC's HRI describes their 47-page report, they project "the growth of private medical costs in the coming year and identifies the leading trend drivers.... based on the best available information through June 2019. HRI conducted 55 interviews from February through June 2019 with health industry executives, health benefits experts and health plan actuaries whose companies cover more than 95 million employer sponsored large group members about their estimates for 2020 and the factors driving those trends. Also included are findings from PwC’s 2019 Health and Well-being Touchstone Survey of more than 550 employers from 37 industries as well as PwC HRI’s national consumer survey of 2,500 US adults."

Here’s Ten Takeaways from their 2020 report: 

1. Small Uptick: The Medical Cost trend, still rounding to double digits in 2007 (11.9%) and 2008 (9.9%), trended downwards subsequently, to round to six percent since 2016 (6.2%), but have ticked up since the low-water mark of 5.5% in 2017 (and 5.7% in 2018-2019.)
2. Price, Not Utilization: “Prices have been a larger component of employer benefit costs than utilization since 2004; utilization has hovered around zero percent growth since 2006. Utilization by individuals with employer-based insurance decreased by 0.2 percent from 2013 to 2017 while prices rose 17 percent during that time.”
3. Impact of High Deductibles: “Average deductibles for employer-sponsored plans tripled between 2008 and 2018. This increase likely has led to a low utilization trend because employees are delaying or forgoing care due to their deductible.”
4. Stall in HDHP Growth: “The shift to HDHPs by employers seems to have stalled. With 84 percent of employers offering an HDHP option in 2019 and a tight labor market, employers may not be as quick to push HDHPs in 2020.
5. Acceleration in Retail Rx Spending: “Starting in 2020, retail prescription drug spending growth for private health insurance will begin to increase, hitting between 3 percent and 6 percent annually through 2027.24 The growth in spending can be attributed to the waning impact of generics on the market and the introduction of new drugs.”
6. Specialty Drug Million Dollar Drugs Pipeline: The portion of total retail drug spending on specialty drugs continues to grow. “We are at an inflection point with drugs in the pipeline. We thought hep C was expensive at nearly $100,000 per treatment. Many drugs in the pipeline are life-altering and come with a price tag of $1 million to $2 million per treatment.”
7. Growth in Chronic Disease Spending: "Spending by employers on individuals with chronic diseases is nearly quadruple [3.5x] that of healthy individuals while spending on individuals with complex chronic diseases is eight times higher" [8.2x].
8. Growth in Onsite Clinics: “38 percent of large employers offered an onsite health clinic in 2019, up from the 27 percent that offered a clinic in 2014. An additional 13 percent said they were considering adding one.”
9. Telehealth Potential: “49 percent of consumers with employer coverage said they are willing to use telehealth in place of an in-person visit.”
10. Underutilized Wellness and Prevention programs: “For decades, employers have invested in health and wellness and prevention, yet participation remains low.....The small population of employees who participate in their employers’ health and wellness programs generally believe the programs have had a positive impact on their health.”

Analyzing Blue Cross Blue Shield Plan Administrative Costs

By Clive Riddle, June 13, 2019

Sherlock Company in the June issue of their Plan Management Navigator examines administrative cost trends for Blue Cross Blue Shield Plans, analyzing year end 2018 vs 2017 data.  They found that costs “increased by 5.5% per member, up from an increase of 5.1% for 2017. Reweighting to eliminate the effects of product mix differences between the years, per member costs increased by 6.7% as compared with 5.9% in 2017. ASO/ASC increased as commercial insured membership declined. Medicare Advantage continued to grow rapidly.”

 Their key findings included:

• Most clusters of expenses grew at rates less than last year.
• Uniquely, Account and Membership Administration’s growth rate increased.
• Growth in Information Systems was the single most important reason for administrative expense increase in 2018.
• The shift in favor of products and market segments that are lower cost to administer muted the real growth.

Sherlock’s benchmarking study “analyzes in-depth surveys of 14 Blue Licensees serving 37 million members. Surveyed Plans comprise 52% of the members of Blue Cross Blue Shield Plans not served by publicly-traded companies.” 

Why does this benchmarking matter? Because the non-publicly traded BCBS plans provide a meaningful universe to benchmark, and plan administrative expenses are highly scrutinized, and certainly more controllable than medical expenses. As Doug Sherlock states, “in the current environment, optimizing administrative expenses is a high priority for health plan managers. Plans have completed their adaptation to the Affordable Care Act and the bulge in Exchange and Medicaid members. Plus, administrative expense visibility has been heightened by the rhetoric of presidential candidates.”

Here’s some key specific data from their report:

• For the universe as a whole, the median total costs were $38.51 per member per month, higher than last year’s $34.99. 
• By functional area, median pmpm costs were: Sales & Marketing $9.21; Medical & Provider Management $5.03; Account and Membership Administration $16.10 and Corporate Services $5.92
• Median pmpm costs by product categories included: Commercial insured $49.84; Commercial ASO $28.32; Medicare Advantage $112.08; and Medicaid $46.08.
• The median administrative expense ratio was 9.0% compared with 8.9% last year.
• The median administrative expense ratio by product categories included: Commercial insured 10.8%; Commercial ASO 7.1%; Medicare Advantage 12.5%; and Medicaid 9.3%.
• Staffing ratios increased by 6.8%, especially in Information Systems. 
• Approximately 19 FTEs serve every 10,000 members in the commercial products. 
• Compensation, including all benefits except OPEB, increased at a median rate of 3.8%. 
• The median proportions of FTEs that were outsourced was 11.0%.
• After the effect of the Miscellaneous Business Taxes, total administrative expense PMPM increased by 17.9% compared with a decline of 2.3% in the prior year 

Consumer Surveys on SDOH Experiences: Kaiser, McKinsey and Waystar

By Clive Riddle, June 7, 2019 

Kaiser Permanente has just released results of consumer SDOH survey they commissioned entitled Social Needs in America, which found “68% of Americans surveyed reported they experienced at least one unmet social need in the past year. More than a quarter of those surveyed [28%] said that an unmet social need was a barrier to health, with 21% prioritizing paying for food or rent over seeing a doctor or getting a medication.”  In two other recent consumer SDOH survey reports, one [Waystar] found the same exact percentage [68%] reporting one or more unmet needs, while the other [McKinsey] found a lower figure [53%.] 

Here’s some of the Kaiser survey’s other detailed findings:

Respondents that frequently or occasionally experience stress include:

• 39%  over meeting their family’s needs for food/balanced meals;
• 38% over social relationships needs;
• 35% over meeting housing needs; and,
• 32% over transportation needs

Respondents believe these factors are important to overall health:

• stable housing (89%)
• balanced meals (84%)
• reliable transportation (80%); and
• supportive social relationships (72%) 

35% lack confidence that they could identify the best resource if they or a family member needed to use community resources relating to transportation, food, housing, or social isolation. 

42% would turn to their medical services provider when looking for information on community resources to help with social needs, and 30% would turn to their health insurance provider for this information.

Respondents are supportive of medical service providers assessing social needs;

• 93% say their medical provider should ask about access to
• food and balanced meals;
• 83% say their medical provider should ask about safe and stable housing;
• 78% say their medical provider should ask about social relationships and
• isolation; and
• 77% feel that their medical provider  should ask about transportation to work, school, appointments, or activities

Mckinsey examined consumer interest in SDOH offerings and how SDOH impacted healthcare utilization rates in their 2019 Consumer Social Determinants of Health Survey report, released in April, which found 53% reported they were adversely impacted by at least one SDOH factor, with food security being the most commonly reported unmet need (35%), followed by safety (25%) housing (21%) social support (17%) and transportation (15%). McKinsey found that 45% of respondents with unmet social needs reported high healthcare utilization, compared to 21% of respondents reporting no unmet needs. 85% of respondents indicated they would use a social program offered by their health plan.

Waystar released results of their consumer SDOH survey in December, finding:

• 68% of consumers have at least some level of SDoH challenge and 52% have a moderate to high SDoH risk in at least one category.
• Patients with SDoH issues are 2.5 times more willing to talk about those issues with clinicians than they are with payers
• Patients with high SDoH risk are more than 20 times more likely to miss a medical appointment at least once a month
• Medicare and Medicaid, have the largest high-stress share with 33 percent having high stress in three or more areas, compared to 21 percent of the commercial insurance population being "high risk."

The Short List of Major Healthcare Implications from A Declining Birth Rate

By Clive Riddle, May 17, 2019

Like most of the industrialized world. the U.S. birth rate is declining, as evidenced in the new  CDC National Center for Health Statistics National Vital Statistics System May 2019 report on "Births: Provisional Data for 2018."  (the final birth report is scheduled to come out this fall.) The big news from the report is the number of births was the lowest in 32 years, and the fertility rate reached another record low.

Here's highlights from the report: 

• The provisional number of births for the United States in 2018 was
• 3,788,235, down 2% from 2017 
• The general fertility rate was 59.0 births per 1,000 women aged 15–44, down 2% from 2017 a
• The total fertility rate declined 2% to 1,728.0 births per 1,000 women in 2018
• Birth rates declined for nearly all age groups of women under 35, but rose for women in their late 30s and early 40s
• The birth rate for teenagers aged 15–19 was down 7% in 2018 to 17.4 births per 1,000 women
• Rates declined for both younger (aged 15–17) and older (aged 18–19) teenagers
• The cesarean delivery rate decreased to 31.9% in 2018; the low-risk cesarean delivery rate decreased to 25.9%
• The preterm birth rate rose for the fourth year in a row to 10.02% in 2018
• The 2018 rate of low birthweight was unchanged from 2017 (8.28%)

In a Q&A session with report author Brady E. Hamilton, Ph.D. posted in the NCHStats blog, Hamilton is asked if there was a specific finding that surprised him, which he replied "the record lows reached for the general fertility rate, the total fertility rate and birth rates for females aged 15-19, 15-17, 18-19, and 20-24 are noteworthy. In addition, the magnitude of the continued decline in the birth rate for teens aged 15-19, down 7% from 2017 to 2018, is also historic." Hamilton was non-committal about the trend going forward, stating “these data do not answer the question of why the number of births dropped in 2018 or if the decline will continue.”

But assuming the trends do continue, which certainly the opinion of many, there are certainly major implications for healthcare, including this short-list: 

• Impact of reduced demand for hospital and physician OB services
• Impact of increased births from higher-age mothers, with greater care complexities involved
• Longer range reduced demand for hospital and physician pediatric services
• Longer range reduced available Medicare funding from employed workforce, with growing imbalance of senior retired population compared to working population

Consumer Insights and Kaiser Initiative on SDOH

By Clive Riddle, May 10, 2019

McKinsey has just published various insights from their 2019 Consumer Social Determinants of Health Survey, which found that compared to those whose social need is met, respondents (2,010 surveyed with government program coverage or uninsured and below 250% of federal poverty level) that:

• Reported food insecurity were 2.4 times more likely to report multiple ER visits, and 2,0 times more likely to be hospitalized
• Reported unmet transportation needs were 2.6 times more likely to report multiple ER visits, and 2,2 times more likely to be hospitalized
• Reported unmet community safety needs were 3.2 times more likely to report multiple ER visits

Encouraging news from the survey for health plan advocates of SDOH was that 85% of respondents reporting unmet social needs said they would use a social program offered by their health insurer. Regardless of their social needs, respondents were interested in these types of health plan SDOH programs as follows: 

• 50% were interested in grocery store discounts for healthy foods
• 48% were interested in free memberships at local gyms
• 45% were interested in a wellness dollar account used towards wellness services of their choice
• 41% were interested in total reimbursement of home improvement purchases to address health issues
• 40% were interested in after-hours drop-in clinics at lower or no cost 

Speaking of health plans, Kaiser Permanente has just announced their new Thrive Local initiative, a “a social care coordination platform” with “a network of public agencies and community-based organizations that will support” Kaiser “members to meet their social needs.”

Kaiser says that “starting this summer, closed-loop and bidirectional communication will provide confidence that referral, follow-up and ongoing patient/family engagement happen. Improved cross-sector collaboration and communication will also reduce the unintentional trauma and stigma that our patients and families may experience. Beyond Kaiser Permanente members and patients, community-based organizations will also benefit through improved decision support, automation, and relevance of the referrals they receive from their health system. This connectivity and interoperability between health care and social organizations and agencies will redefine the meaning of ‘provider network’ in this new world as the network of providers of health, health care, and social needs to address total health of our communities.”

Kaiser Permanente is partnering with Unite Us to launch the program, as tells us that Thrive Local within three years “will be available to all of Kaiser Permanente’s 12.3 million members and the 68 million people in the communities Kaiser Permanente serves.

CVS Caremark PBM Releases Its Own Report Card and Gives Itself A’s

by Clive Riddle, April 12, 2019

CVS Health’s Caremark PBM has just released their annual Drug Trend Report, and tells is that they “blunted the impact of drug price inflation achieving a negative -4.2 percent price growth for non-specialty drugs and a 1.7 percent price growth for specialty drugs. Furthermore, 44 percent of CVS Caremark's commercial PBM clients saw their net prescription drug prices decline from 2017 to 2018.”

In the 12-page report, CVS Caremark notes that while medical costs have increased by 14% since 2013, their member average cost per 30-day Rx decreased 8.4% during that time, from, $11.96 to $10.95. They also remind us Non specialty brand AWP increased 8.1% last year, and specialty brand AWP increased 7.6% last year, while overall U.S. inflation increased 1.9%.

CVS Caremark reports that specialty drugs account for 1% of their Rxs, but 45% of their pharmacy spend.  They cite specialty drug cost growth as the number one trend to keep on your radar going forward. The rest of the top five trends:

2) Integrated management of specialty drug spend that falls under the medical benefit, given 45% of the specialty spend falls under medical benefits

3) Addressing pharma manufacturer innovations in marketing and product protection to reduce market competition

4) Strategies to improve medication adherence for chronic disease patients

5) Identifying “bad actors” through analytics

Got $285k for Healthcare Costs in Your Retirement Years?

By Clive Riddle, April 5, 2019

West Health and Gallup this week released a 44-page report: The U.S. Healthcare Cost Crisis, with survey results that addressed “the impact of the high cost of healthcare on personal finances, individual healthcare choices and the level of satisfaction with the U.S. healthcare system.”

The survey found “that despite 45% of respondents reporting fears of bankruptcy if a major health event strikes, 1 in 4 skipping a medical treatment due to costs and Americans collectively borrowing an estimated $88 billion to cover healthcare costs in the past year.” The report also tells us that: 

• When given the choice between a freeze in healthcare costs for the next five years or a 10% increase in household income, 61% of Americans report that their preference is a freeze in costs
• 76% expect their costs for healthcare will increase even further in the next two years
• 26% have deferred a treatment
• 12% borrowed money to pay for healthcare in the past year, including nearly 3 million borrowing $10,000 or more
• 23% cut back on household spending due to healthcare costs
• Only 36% of  doctors discuss costs with them in advance of procedures, tests or treatment plans, and 34% discussed costs of prescriptions 

But the concern rightfully is heightened for seniors (age 65+) who have the most immediate and more complex healthcare needs overall, and finite financial resources: 

• 31% of seniors will be unable to pay for basic healthcare in the next 12 months (41% with annual household income <$60,000)
• 29% will be unable to pay for medicine in the next 12 months (42% with annual household income <$60,000)
• 38% said a major health event could lead to bankruptcy 38%  (45% with annual household income <$60,000) 

Fidelity this week released their annual analysis of out of pocket Medicare expenses and funds required for medical expenses with a couple retiring today. 

According to Fidelity, “a 65-year old couple retiring in 2019 can expect to spend $285,000 in health care and medical expenses throughout retirement, compared with $280,000 in 2018. For single retirees, the health care cost estimate is $150,000 for women and $135,000 for men.” Fidelity tells us that “while there’s no surprise that health care costs are a top financial concern in retirement, the past two years combined have seen a slower rise (3.6 percent) than in the previous two (2015-2017), which saw the estimate grow to $275,000 from $245,000 (up a total of 12.2 percent). Even without the same rate of growth, some retirees are still surprised by today’s cost of health care.” 

Fidelity healthcare prescription isn’t surprising – they advocate building savings to cover the expenses, through HSAs:

Cigna Study: More Stressed + Less Rested + Less Family & Friends Time = America

Cigna has released their 2019 360 Well Being Survey: Well and Beyond, a 15-page report “that explores perceptions of well-being across five key indicators – physical, family, social, financial and work – in 22 countries, including the United States.” Their findings indicate applicable measure for the U.S. are all getting worse – not better. Jose Quesada, Cigna’s Chief Medical Officer, International Markets tells us “we’re seeing high incidences of stress, poor sleep quality and less time connecting with loved ones, which all can have a profound impact on one’s physical health.”

Overall the study found "the global well-being index remained largely steady at 62.0 points, closer to 2017 levels, with a marginal improvement from 2018’s decline;" and that "geographically, India, Saudi Arabia, Nigeria and Indonesia showed the strongest improvement in overall wellness with a rise of between 2.1 and 4.4 points, while the US, New Zealand, Taiwan and Singapore showed slight drops, with New Zealand reporting the largest fall." 

The survey results for Americans include:

• Only 28% reported being at a healthy weight
• 33% know their Body Mass Index (BMI)
• 60%+ know their blood pressure
• Four of five Americans report feeling stressed
• Only 25% report employer assistance/support f in managing stress – down 17% from 2018
• 61% said their employer did not provide or sponsor any workplace wellness program
• Only 35% report they get sufficient sleep at night, down six points from 2017
• 32% report having “good quality sleep,” down eight points from 2017
• 45% attested to feeling excellent/very good about the amount of time spent with family, compared to 51% in 2017
• 62% of Americans spend sufficient time with friends, down five points from 2018

We’re #1! Healthcare Leads the Way in Travel and Wait Times

by Clive Riddle, March 8, 2019

Altarum recently released a six page report: Travel and Wait Times are Longest for Health Care Services and Result in an Annual Opportunity Cost of $89 Billion” which compiled data for the Bureau of Labor Statistics’ American Time Use Survey. Their study found “waiting times for health care services in particular were much higher than the other service categories, over twice the length of the next closest, veterinary services.”

Alturm reports that “the time spent traveling and waiting for health care services on a day when an individual got care was over 50% of the time spent actually receiving care—45 combined minutes traveling & waiting vs. 76 minutes receiving care (data not shown). Among all time spent on health care related activities (self-care, assisting others, receiving professional care, waiting and travel), travel and waiting for care accounted for 19.7% of the total time spent, on average over two minutes a day or an hour per month.”

Altarum outs a price tag and all this traveling and waiting: “When quantified by applying an individual’s hourly wage as an approximate measure of the economic cost of time spent, travel and waiting costs averaged $89 billion dollars annually from 2006 thru 2017.”  But the really sad news is that “despite significant investments in the United States over this period in improving access to health care through better insurance, the use of innovative delivery systems, and advances in digitizing health care records and automating administrative processes, travel and wait times show no discernable improvements in these data from 2006 to 2017.” 

Vitals, recently acquired by WebMD, has annually released a report on physician wait times, Their most recent report tells us that where you’re traveling to or from makes a big difference in physician waits. Wisconsin has the shortest average wait time of 13 minutes 23 seconds while Alabama comes in as the longest with 22 minutes 19 seconds.  Your wait in Seattle averages 14 minutes 38 seconds (second shortest city– three seconds longer than Milwaukee) while a wait in El Paso comes in as the longest at 26 minutes 50 seconds. 

Vitals also reports that “30 percent of people reported they’ve walked out of an appointment due to long waits. What’s more, 1 in 5 report they’ve changed doctors because of long wait times.”