Have you taken a prescription drug during the past month?

by Clive Riddle, September 3, 2010

CDC’s National Center for Health Statistics has just released a Data Brief: Prescription Drug Use Continues to Increase: U.S. Prescription Drug Data for 2007-2008  [Gu Q, Dillon CF, Burt VL. Prescription drug use continues to increase: U.S. prescription drug data for 2007-2008. NCHS data brief, no 42. Hyattsville, MD: National Center for Health Statistics. 2010.]

Here’s a laundry list of what you can glean from the eight page report on U.S. prescription drug use:

• 48% had taken a prescription drug(s) during the past month, up from 44% ten years prior
• 31% had taken two or more prescriptions during the past month, compared to 25% ten years prior
• 11% had taken three or more prescriptions during the past month, compared to 6% ten years prior.
• 52.8% of those with health insurance had taken a prescription drug during the past month, compared to 28.5% without health insurance
• Among children (under age 12), less than 10% used two or more prescription drugs in the past month and only 1% used five or more.
• Among older Americans (aged 60 and over), more than 76% used two or more prescription drugs and 37% used five or more.
• The prescription drugs used most of for children aged 0-1 were Bronchodilators for Asthma (5.7% used)
• The prescription drugs used most of for adolescents aged 12-19 were CNS stimulants for ADD (6.1% used)
• The prescription drugs used most of for adults aged 20-59 were Antidepressants (10.8% used)
• The prescription drugs used most of for adults aged 60+were Cholesterol lowering drugs (44.9% used)
• Total U.S. spending for prescription drugs was $234.1 billion in 2008, more than double what was spent in 1999

The report is based on the National Health and Nutrition Examination Survey (NHANES) which examines a range of other aspects of national health and nutrition components as well, designed to monitor the health and nutritional status of the civilian noninstitutionalized U.S. population using a nationally representative survey population.

COBRA Costs: The Good News, Bad News and Good News

by Clive Riddle, August 27, 2010

The good news: earlier this summer, PricewaterhouseCoopers, in their Behind the Numbers Medical Cost Trends for 2011 report, had this to say about COBRA costs:  “COBRA costs are expected to return to more normal levels in 2011. COBRA subsidies passed by Congress in 2009 created a 1% upswing in the medical trend. Laid-off workers who continued their healthcare coverage typically incurred medical costs of two to four times higher than those of other workers. In 2010, the combination of higher unemployment and new government subsidies to pay for COBRA coverage led to a significant increase in COBRA coverage. A combination of declining unemployment and expiration of the COBRA subsidies is expected to lead to reduced enrollment in COBRA in 2011.”

The bad news: Aon Consulting has just released results from their 2010 Benefits Survey, which found average monthly COBRA premium costs increases from 2009 for the cheaper HMO policies took an extra annual $360 for single coverage and $960 for family coverage from the unemployed and others who opted for COBRA coverage. Here’s a table we compiled from the Aon survey results:

COBRA Monthly Premiums	2010	2009	% Increase	Total Increase
HMO
Employee Only	$429	$399	7.5%	$30
Employee +1	$879	$783	12.3%	$96
Employee + Children	$872	$844	3.3%	$28
Employee + Family	$1,251	$1,171	6.8%	$80
PPO
Employee Only	$449	$439	2.3%	$10
Employee +1	$925	$903	2.4%	$22
Employee + Children	$875	$909	-3.7%	-$34
Employee + Family	$1,310	$1,275	2.7%	$35

"The increased frequency and duration of COBRA use is creating a significant strain on the program, leading to higher costs. Those who are unemployed, and facing uncertainty about employment prospects and future COBRA availability, are utilizing the program more than we've traditionally seen to treat a variety of conditions prior to potentially losing coverage. This coupled with the high unemployment rate, is placing the COBRA program in a unique and unprecedented position."" John Zern, Aon Consulting’s executive vice president and Health & Benefits Practice director tells us.

The good news: the COBRA premium increased from 2009 to 2010 on a percentage basis were in line with non-COBRA premium increases, even though the population would be considered to be much higher risk.

What Do We and EBRI Really Know About Consumer-Driven Health Plans?

by Clive Riddle, August 6, 2010

EBRI (Employee Benefit Research Institute) has just published a 28 page issue brief by Paul Fronstin, Director of EBRI’s Health Research and Education Program:  What Do We Really Know About Consumer-Driven Health Plans? A decade since their introduction in various forms that evolved over time, numerous studies consumer driven plans have since left a data trail that EBRI has followed and attempted to map.

The report concludes that: “the percentage of employers offering an HRA- or HSA-eligible plan increased from below 5 percent in 2005 to between 12−15 percent by 2009…. However, recently, the percentage of small firms that offered a CDHP declined while larger firms continued to add a CDHP as an option. Overall, 19.1 million, or 11 percent of people with either employment-based coverage or individually purchased insurance, were enrolled in a CDHP in 2009….Generally, premiums for CDHPs were lower than premiums for non-CDHPs….However, CDHP premiums may be lower than non-CDHP premium simply because the CDHP population is healthier, and there is some

evidence of this.…The studies agree that use of preventive services did not change (upward or downward) as a result of the CDHP…. Concerning how CDHPs affect prescription drug use, studies found that overall use of brand-name prescription drugs fell… CDHP enrollees increased their use of the mail-order pharmacy option.”

Perhaps the most meaningful analysis of other studies is saved for last: “While HRAs and HSA-eligible plans look a lot alike, the differences are significant enough to warrant separate analyses of the impact of the plans. Also, most of the research to date has focused on plan design and has ignored the impact of the consumer-driven account on use of health care services and overall spending. Individual contributions to HSAs and employer contributions to both HSAs and HRAs may affect the use of health care services. Furthermore, account balances may have an effect as well: Individuals may use health care services differently, depending on how much money is being contributed to the account, especially relative to the deductible; amounts rolled over; and portability of the account. Despite the growing body of evidence on the effect of CDHPs on cost and quality, there are many unanswered questions.”

The conclusion might de-emphasize the increase in employer popularity with the plans over time, although certainly greater with larger vs. smaller employers as the report notes. The KFF HRET annual survey cited found offer rates with large employers (1,000+) increasing from 10% to 29% from 2005 to 2009, and the Mercer annual survey cited found large employee offer rates ranging from 4% (1,000 – 4,999 employees) to 22% (20,000+)  in 2005, increasing to a range of 24%  (1,000 – 4,999 employees) to 47% (20,000+)  in 2010.

The report conclusions emphasize that offer rates may have stalled with smaller employers, evident in the KFF HRET study, but not evident in the Mercer study. The report detail does provide some meaningful disclosure regarding the oft quoted KFF HRET CDHP data: “Unlike other studies, the survey did not find growth in enrollment between 2008 and 2009. The KFF/HRET survey does not include nonworking adults or children in its estimates. It also does not include federal employees or workers in firms with fewer than three employees. The lack of growth may be due to large margins of error for data related to CDHPs in this survey. The lack of growth may also be due to the fact that, while the survey shows growth in offer rates in large firms, it shows a decline in offer rates among small firms (contrary to the Mercer findings). Because there are many more small firms than large firms, the overall offer rate declined slightly as well.”

Tracking consumer driven enrollment data can be maddening. The report cites six major sources the publish enrollment data, with somewhat materially different results. Variances are due to many factors, from differences in study methodologies as discussed above, to fundamental differences in what is defined as a consumer driven health plan. Should the numbers include all qualified high deductible health plans (HDHPs) even if they have no account based plan attached? Should they include FSAs? Should they include enrollment in other consumerism-labeled products?

Many assume numbers and studies quoted examine just HSA and HRA account based plans. This is not always the case. The EBRI report makes a great attempt as sifting through the data to examine the true HSA and HRA findings. But still, after a decade, as the report concludes, “there are many unanswered questions.”

The Truth Is Out There –Are You?

by Laurie Gelb, July 28, 2010

Health care surveys still ask “analog questions” in a digital world, limiting the impact of disease management, marketing initiatives and even transactional communiqués like EOBs. Besides evoking “socially acceptable” responses (who wouldn’t want to be healthily skeptical and savvy, unless you wanted to be stubborn and oppositional?), surveys in 2010 often still rest on “service as product” and “product = attribute bundle” paradigms, which apply poorly to medicine.

As interventions move into the social and mobile media, the risk of pouring more money and brand equity into misguided action increases. In fact, adding to “stimulus overload” can hasten patient and caregiver denial, apathy, fatalism, overkill – and it’s ever-easier to tell everyone in their social networks how and why they got to that point.

Health care realities that are often overlooked by forced choice (e.g. A vs. B scenarios, point allocations, rankings) and attribute-based questions include:

• N=1. No two patients have exactly the same personal/family histories and environments. Yet we ask everyone the same questions. Why? We have computers now so we can personalize questionnaires in real time, the same way we say we want to personalize interventions.

• Heuristics – shortcuts – are more necessary to making health choices than any other kind. You may be able to consider all the possible routes to work in the morning, but you can’t consider – ever—all the supplements you could be taking.

• Opportunities to re-evaluate choices like daily dosing, glucose monitoring, diet, exercise are infinite– unlike  the dishwasher that you’re basically stuck with for a few years

• Instability/unpredictability of product “attributes” – we don’t all define “effectiveness” the same way, yet we all know what “four bedrooms” means, and the drug you took with no issues yesterday can land you in ER today.

• Inability to create what everyone knows would be the ideal product (want a vitamin water that melts solid tumors?), unlike, say, the cereal industry (Apple Jacks with 12g sugar/serving)

• No single “health personality.” For me, popping a naproxen is nothing; for my son, it’s agonizing. Yet he’s blasé enough to have visited a chiro, whereas I never will. So if you ask the two of us the same questions about beliefs and recent care, you’ll miss why our choices differ.

• In for a penny, in for a pound. A plumber can unclog the kitchen sink with no effect on the bathroom, whereas treatment focused on one system often adversely affects another. And when weighing the zero-sum game of deductibles, co-pays and OOP limits, it’s easy to feel that there are no good choices.

By replacing traditional questionnaires with decision-centered designs in which no two respondents may see exactly the same questions, we can understand and track what our audiences believe they know and the extent to which these beliefs are associated with their choices. With dynamic surveys, domains, measures and thresholds are not pre-established but are provided to us by respondents (with whom we are conversing, not forcing them to abstract something that is very real). This on-the-ground data enables us to better address knowledge gaps, evolving expectations, epidemiology/behavior, barriers to action and more – often with interactive tools. Moreover, patient, clinician and payor thresholds often differ significantly, creating misaligned incentives. When we understand how these differ, we can realign programs for “win/win/win” scenarios that optimize health outcomes.

How Brokers See the Recession’s Impact on Employee Benefits

by Clive Riddle, June 4, 2010

Survey data on employee benefit trends and implications surrounding such drivers as the recession typically focus on data from large employers.  Large employers, of course, represent the clientele of the major benefit consulting firms that produce the majority of such studies.

Thus it is interesting to consider perspectives from the broker population, which typically represent smaller and mid-size employers. Colonial Life conducted broker surveys at two large national broker conferences during March and April, regarding the economy’s effects on benefits.

Here’s the results provided by Colonial Life, which indicate expansion of voluntary benefits, increasing employee contributions, and adding HSAs/HRAs are the top strategies:

• Added voluntary benefits options – 59%
• Increased employee contributions – 48%
• Added benefits options – 35%
• Added a health savings account – 29%
• Switched carriers – 28%
• Reduced benefits options – 27%
• Added a high-deductible health plan option with an health reimbursement account – 26%
• Increased employer contributions – 10%
• No change – 9%

In this environment, 80% of the brokers surveyed said voluntary benefits are very important to the overall benefits package they offer business owners. It thus could be beneficial for various stakeholders to do their homework on what existing and emerging products are being offered through the voluntary benefits market, and consider their implications.

The Center for Health Value Innovation on Value Based Design

by Clive Riddle, May 27, 2010

This week, Cyndy Nayer, M.A., President, CEO and co-founder of the Center for Health Value Innovation and Michael S. Jacobs R. Ph., Principal and National Clinical Practice Leader, Buck Consultants, LLC  (also a board member at the Center) spoke in the HealthcareWebSummit event Leveraging Health: Current Impact of Value Based Design.

What’s going on with Value Based Design initiatives right now? Glad you asked. While some other elements of health reform have stolen the spotlight during the past few months, VBD continues to move forward as a key solution to its core stakeholders. 

The Center for Health Value Innovation is an educational organization that serves as an information exchange for value-based designs. The Center’s members include health plans, employers, unions, government, pharmaceutical organizations and other stakeholders that represent over 40 million lives. The Center recently published a new book, Leveraging Health, which shares findings from their recent interviews and surveys that identify more than 100 levers that influence consumer and patient behaviors in Value-Based Design, and15 categorized macro-levers.

Definitions of Value Based Design have evolved over time. The Center has this to say about defining VBD: “It’s important to note that value-based designs (VBD) are much more than waived or reduced co-pays for chronic care, particularly medications.  A value-based design uses evidence-based clinical impact merged with financial impact (Health + Economics) to guide the behaviors of populations in managing their health.  VBD can influence choice of care provider, appropriate and persistent treatment, and early risk/prevention/wellness.  All of these have been documented to show a meaningful impact in health status, productivity (safety, disability, unscheduled absences, and more), quality and financial cost trend.”

Nayer and Jacobs expanded on this definition during their presentation, stating:

• VBD is an engagement tool that engages the employee (consumer) and the employer (plan sponsor) and the provider (clinician)
• VBD focuses on outcomes:  better performance
• VBD is driven by data that drives the suite of performance tuners: levers
• VBD is sustainable and applicable at the small-large employer and at the community level
• VBD builds the Health-Wealth-Performance Portfolio
• VBD uses Data to invest in incentives (Design) and services (Delivery) that change behavior for improved health, quality, performance and financial trend (Dividend.)       

They note that EAP and behavioral health are important components of VBD, given that behavioral change is the key to sustaining value. They further advocate that if value is to be built on outcomes, than purchasing must be aligned. Nayer and Jacobs stat that Outcomes-Based Contracting must align incentives between the contracting parties.

After VBD emerged as a mainstream concept and solution, the Great Recession intervened, and Nayer and Jacobs point out the effect of the economy on health behaviors, placing employee/patient compliance, adherence and persistence at risk.

Here’s some of the Center’s survey results they shared, which are incorporated into their book, Leveraging Health. Over 100 companies responded to their survey, representing over 1 million lives:

87% Use incentives (levers) in prevention and wellness, 60% Use levers for chronic care management, and 26% Use levers for guidance to appropriate care delivery

Given that VBD programs provide various forms of incentives, including applicable waivers of cost sharing, an obvious concern in a down economy would be that employers would feel pressure to pull back in these areas to in the name of achieving short term savings. However the survey indicated 79 % of the employers with VBD in place two or more years made no VBD changes in 2009 and 56% did not plan to make changes in 2010.

Of the 44% who did anticipate changes in 2010: 64% of them plan to pass more of the cost of brand drugs to the employee; 16% plan mandatory enrollment in disease management programs; and 16% plan to pass more of the cost of generic drugs to the employee.

Additional survey results:

• 63 % waive employee cost sharing for yearly screening exam
• 40 % provide insurance premium incentive for completion of a Health Risk Assessment (HRA)
• 54 % cover depression under care management program
• 70 % reduce/waive co-pay for utilizing the lowest cost appropriate site of care (e.g., urgent care, convenient care, onsite services, medical travel)
• 58 % provide incentives for the use of EAP programs
• 35 % provide incentives for financial counseling
• 20% reduced applicable prevention screen cost for age/gender appropriate groups
• 18% provided an insurance premium incentive for completion of a biometric screen
• 13% reduced OOP costs for setting and/or achieving health promotion goals
• 13% provided insurance premium incentive for complying with recommended prevention exam
• 12% adjust their condition-based formulary (all tiers lowered for specified conditions)
• 12% link co-pay/coinsurance waivers to mandatory condition management

Employers also indicated these as their top challenges to deploying their VBD programs (more than one answer allowed):

• 53% - Increasing engagement with employees: slow to use the new benefits
• 45% - Enrolling employees in disease management programs
• 42% - Keeping the momentum going
• 34% - Obtaining and integrating data
• 34% - Lack of communication with physicians/pharmacists/clinicians
• 34% - Communicating benefits with the covered lives
• 32% - Segmenting and interpreting data
• 18% - Communicating success with the covered lives
• 13% - C-Suite support

Hewitt Says We’re More Engaged in Selecting Our Benefits

by Clive Riddle, April 2, 2010

Hewitt Associates this week released data indicating that employees in 2009 were more engaged in selected their health benefits than in previous years. That being said, Hewitt concluded their choices weren’t all that different than before, they were just more involved in the process.

Here’s some of what Hewitt had to report on the matter: “Hewitt's analysis of 6 million U.S. workers, for whom Hewitt managed benefits enrollment in the fall of 2009, revealed the highest number of active enrollees since Hewitt began tracking the data in 2003. Nearly half (45 percent) of employees actively chose their benefits for 2010 instead of passively defaulting into the same coverage or no coverage at all. This is up significantly from the 2009 open enrollment period, where just 39 percent of employees actively enrolled. Despite employees taking a more active role in selecting their benefits, Hewitt's data shows very few workers enrolled in different health insurance plans.”

So what plans are employees enrolling in? Here’s a data table Hewitt shared indicating enrollment by plan type for the past three years (note that the survey involves large employers):

Enrollment by Plan Type

Open Enrollment Year	EPO	HMO	POS	PPO	Indemnity	HDHP
2008	1%	17%	11%	31%	15%	20%
2009	1%	17%	5%	34%	11%	18%
2010	1%	14%	8%	35%	13%	18%

So what does Hewitt make of all this? Sara Taylor, Hewitt’s Health and Welfare Strategy Leader tells us: "Employee inertia continues to play a large role in enrollment decisions—it's encouraging to see that people are more engaged in assessing their benefits, but that doesn't mean they are necessarily making different choices. If employers want workers to make different elections, they might need to adopt a more aggressive approach—whether it's changing or reducing plan options or offering plans with widely differing price points."

How do Insiders Feel About Consumerism Now?

by Clive Riddle, March 26, 2010

In conjunction with last week’s Ninth Annual Consumerism Web Summit, MCOL conducted an e-poll of professionals, asking what components of consumerism are the most important, and how linked consumerism’s fate is to the outcome of health reform.

Survey respondents for 2010 and 2009 were asked the same questions regarding ranking typical components of Consumerism, and their perspective as a respondent. 2010 respondents were also asked, to what degree are health care consumerism initiatives dependent upon the outcome of any impending health care reform.

Respondents were asked to rank the five listed components 1 through 5, with 1 being the most important, and to only use each ranking once (only one item ranks 1, one item ranks 2, etc.)

Professionals continue to feel Price and Quality Transparency is the most important component by far.  Account based plans and wellness incentive programs end up close to distant tie for second, depending on the measure you use, followed by web based consumer patient health records and retail medicine.

Interestingly, if you examine the percent of respondents ranking an item as number 1, and consider the change from 2009 to 2010: transparency, account based plans and web based records all gained ground, while wellness incentives and retail medicine lost ground.

36.3% of respondents said that  consumerism initiatives were highly dependent upon the outcome of impending health care reform, while 41.2% said they were somewhat dependent and 22.5% said they were not very dependent.

Below are details regarding how respondents ranked components of consumerism, and their perspective as a respondent, for the past two years:

(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.)

	2010	2009	2010	2010
	Mean	Mean	Median	Mode
Price and Quality Transparency	1.85	2.00	1	1
Account Based Plans (HSA/HRA/FSA)	3.06	3.08	3	2
Wellness Incentive Programs	3.03	2.65	3	4
Web Based Consumer Patient Health Records	3.35	3.70	4	4
Retail Medicine (Convenient Care, etc)	3.69	3.57	4	5

Component	Rank 1: 2010	Rank 1: 2009	Rank 5: 2010	Rank 5: 2009
Price and Quality Transparency	59.4%	55.8%	7.0%	11.9%
Account Based Plans (HSA/HRA/FSA)	17.7%	12.8%	24.9%	17.9%
Wellness Incentive Programs	7.0%	20.9%	8.7%	3.6%
Web Based Consumer Patient Health Records	11.8%	4.7%	21.6%	31.0%
Retail Medicine (Convenient Care, etc)	4.3%	5.8%	37.8%	35.7%

Perspective of Respondent:	2009	2010
Purchaser (Health Plan, Employer, TPA, Agent, PBM)	30.6%	43.4%
Provider (Hospital, Physician, Pharmaceutical, Other Providers)	27.1%	24.0%
Vendor/Other (Vendors, Consultants, Institutions, Gov., All Other)	42.4%	31.8%

n = 189 for 2010, 85 for 2009 

Carrots and Sticks

by Clive Riddle, March 18, 2010

Carrots and Sticks.
Will employee health behaviors they fix?
Or are they just a fad, pulled from employers’ big bag of tricks?
Should incentives or penalties be preferred, oh what’s the right mix?
Surveys may tell us the answer, about Carrots and Sticks.

On Saint Patrick’s Day, while others were reveling and feeling festive, Hewitt Associates released results from the annual health care trends survey, in which they conclude “Companies [are] increasing the Use of Both Incentives and Penalties to Motivate Employees, Improve Outcomes and Reduce Costs.”

Hewitt’s Cathy Tripp tells us "the economy and continued escalation of health care costs have driven many employers to be a little more bold and demanding of their employees, making disincentives an increasingly attractive option. As companies learn more about their workforce, they're realizing that some people may be more motivated to take action if they risk losing $100 versus gaining $100. The key for each employer is to find the right mix of strategies and plan designs that will motivate employees to be healthier, but not go so far as to drive the wrong behaviors."

The Hewitt survey tapped 600 large employers representing 10 million+ employees. Here’s what they found:

Penalties for non participation in health improvement programs

• 47% either already use or plan to use financial penalties over the next three to five years
• 81% of those using/planning penalties will impose higher premium contributions; 17% will apply increased deductibles; and  17% will design higher other out-of-pocket cost sharing
• Of those using/planning penalties, the behaviors that will trigger penalties were: smoking (64%); non-participation in disease management/lifestyle behavior programs (50%); non-participation in biometric screenings (45%); non- participation with a health coach (25%); failure to  achieve applicable biometric improvements (17%)

Incentives for participation in health improvement programs

• 58% offer incentives, with 24% of them extending incentives to spouses and/or family members
• 63% of those offering incentives provide cash for completing a health risk questionnaire (35% in 2009)
• 37% of those offering incentives cash incentives for participating in health improvement and wellness programs (29% in 2009)
• 14% of those offering incentives cash incentives for participating in condition management programs (17% in 2009)

Towers Watson Findings

Hewitt isn’t alone in seeing a trend is in the works. Towers Watson last week released additional findingsfrom their 15th Annual NBGH/Towers Watson Employer Survey on Purchasing Value in Health Care which covered 507 employers of 1,000 or more employees, representing 11.5 million employees, also concluding that employers are going to be putting much greater emphasis on incentives and consumerism.

Ted Nussbaum, senior consultant with Towers Watson tells us "employers are frustrated by their employees’ low use of expensive health improvement programs. As employers continue to empower workers to be more health focused, they are beginning to target and reward those workers who demonstrate a real commitment to making positive lifestyle changes.”

Here's what Towers Watson found:

• 53% offer financial incentives for employees enrolled in health engagement activities
• 37% reward only employees who meet the company’s requirements for completion of a health engagement activity,
• 29% only reward members who participate in multiple activities

Accenture Says Physician Laggards are Poised to Finally Adopt

by Clive Riddle, March 5, 2010

Smaller physician offices, lacking infrastructure and capital and perhaps motivation, have been viewed as the stumbling blocks to widespread physician EMR adoption, And without adequate physician adoption, hospital and health plan adoption won’t likely achieve the level of effectiveness required to justify their investments.

Accenture this week released results from a study conducted by their Innovation Center for Health and Institute for Health & Public Service Value in conjunction with Harris Interactive in which they surveyed 1,000 U.S. physicians from smaller practices (fewer than 10 physicians) regarding EMR use, with 15% of respondents being current EMR users at various levels and 85% non-users.

The good news? The majority of non-users say they now intend to purchase a system, and the percentage goes way up when you ask those who aren’t so close to retirement. The bad news?  (1) The majority if them are looking to hospitals for help and subsidies; (2) saying you intent to purchase a system doesn’t necessarily translate into actually doing so; and (3) there’s still a material number that won’t even go so far as to make that verbal commitment, despite upcoming federal penalties and incentives.

Here’s some of the key findings from Accenture:

• 58% of non-users intend to purchase an EMR system within the next two years;

• About 80% of physicians under age 55 plan to implement an EMR system within the next two years;

• 75% of non-users are potentially interested purchasing an EMR system from a local hospital - if at least subsidized for about half the cost;

• The key driver of EMR adoption is federal legislation - 61% cited federal penalties for non-adoption and 51% cited federal incentives;

• Non-users underestimate the cost and time requirements to implement an EMR system, but also have an exaggerated perception of difficulties in using EMR systems, compared to the actual experiences of EMR users;

• 90% of current EMR users – believe that their system has brought value to their practice- providing an effective overview of patients’ relevant history, records and information; and allowing quick and accurate data entry.

Accenture credits federal legislation for stimulating interest. Dr. Kip Webb, who leads their clinical transformation practice, tells us “our research indicates that, as intended, federal legislation is an important driver of EMR adoption among U.S. physicians. If U.S. health care providers properly implement and use EMRs more broadly, there is no doubt that EMRs can make an important contribution to improving quality of care and controlling costs.”

While a wider number have some level of EMR, Accenture notes that “today, just six percent of U.S. office-based physicians use a fully functioning system.”

TowersWatson Employer Survey: Employees and Vendors aren’t getting it done

by Clive Riddle, February 24, 2010

Employers hold employee health habits and lack of engagement largely to blame for cost increases, and feel vendors are ineffective at getting this behavior to change.

TowersWatson just released results from their 15th Annual National Business Group on Health/Towers Watson Employer Survey on Purchasing Value in Health Care. The study finds that employer health plan costs are projected to increase 6.5% for 2010, down from 7.0% in 2009, but still more than double the inflation rate. The study also found that in response, 83% of companies have already revamped or expect to revamp their health care strategy within the next two years, up from 59% in 2009.

Ron Fontanetta, a senior consultant at Towers Watson tells us, “the downturn has amplified the pressure on companies to find ways to support effective health management programs under budget constraints. For employers, the current environment is a clarion call to adjust their health plan strategy, reassess vendor relationships and aggressively address the challenge to encourage workers to become better advocates for their own health.”

Perhaps most interesting was employer listings of the top three challenges to maintaining affordable benefit coverage. Of eleven responses summarized in the survey report, the three responses listed the most were: Employees Poor Health Habits (67%); followed by a tie between High Cost Catastrophic Cases and End of Life Care (41%) and Underuse of Preventive Services (41%.)

So then Employers where asked, what were the top three obstacles to changing these poor employee health habits: of thirteen responses summarized in the survey report, the three responses listed the most were: lack of employee engagement (58%); lack of financial incentives to encourage participation in programs (31%); and lack of adequate budget to support health management programs (30%).

Other findings from the survey include:

• Regarding Consumer Driven Health Plan adoption: 44% said they had already done so with no further action needed; another 9% have adopted but plan to take additional action; 14% plan to adopt in the next two years; and 34% don’t intend to adopt.

• 23% have already consolidated health and productivity programs with a single vendor or health plan with no further action needed; another 8% have done so but plan to take additional action; 13% plan to do so in the next two years; and 57% have no plans to do so.

• 93% had no intention of reducing or eliminating health promotion programs; and 78% had no intention of reducing staff dedicated to health benefit programs.

• 57% had confidence in the future of employers as health benefit sponsors, compared to 62% in 2009 and 73% in 2010.

• 69% are auditing or reviewing health plan eligibility; 66% are using incentives to encourage completion of health risk appraisals; 57% are using claims analysis of data in a warehouse; 56% offer health coaching; and only 19% are reducing pharmacy copays for those with chronic conditions (a value based purchasing initiative)

• Employers feel vendors aren’t that effective in changing member behavior: 67% said they were not at all or just slightly effective in driving more efficient member use of services; and 66% said they were not at all or just slightly effective in changing member behavior to make more health lifestyle decisions.

Results from the Future Care 2010 e-poll

By Clive Riddle, President, MCOL

MCOL has just released results from our eighth annual Future Care* e-poll survey conducted this month of Future Care web summit attendees and MCOL members. Almost all responses were received after the Brown Massachusetts Senate election. Respondents represented the following perspectives:

• Payor - 30.5%
• Provider - 33.6%
• Vendor - 16.4%
• Other - 19.5%

We ask participants three questions each year. First, which of the following health care business trends do you think will have the greatest overall impact in the coming year? Respondents point to health reform and the recession as the big drivers. Its also interesting to see how cost sharing increases have significantly diminished in importance last year and this year. Here’s this year’s and historical responses:

Trend	2010	2009	2008	2007	2006	2005	2004	2003
Advances in technology	6%	3%	12%	8%	17%	14%	12%	11%
Consumer Driven plans	7%	3%	13%	18%	21%	23%	14%	15%
Compliance issues	7%	1%	1%	3%	1%	1%	6%	18%
Effects of the Recession	26%	57%	NA	NA	NA	NA	NA	NA
Health Reform Initiatives	37%	21%	24%	11%	28%	14%	4%	N/A
Increased cost sharing	5%	9%	34%	40%	26%	38%	36%	39%
Disease Management	5%	3%	13%	8%	3%	6%	24%	N/A
Other	5%	1%	4%	12%	5%	6%	4%	17%

Conversely, we asked what predicted trends do you feel is LEAST likely to occur or have an impact in the next two years? Respondents feel health plan premium increases won’t keep cooling down, and there are plenty of health care reform skeptics:

Response	Percent
Premium Increases will continue to slow down	24%
Significant National Health Care Reform Legislation will be enacted	20%
Major growth of Consumerism initiatives	19%
Health Plan cost sharing activities will level off/slow down	13%
Further growth/adoption of disease management and wellness	12%
Major advances in patient/provider/plan electronic data transfer	11%
Other	1%

Lastly, we asked respondents to rank stakeholders as winners or losers for the coming year.  Respondents feel pharmaceutical plans will by far fare the best among stakeholders, with health plans finishing a distant second, and all other stakeholders ranked way back.  Of course the great unknown is health reform, which could significantly alter the fortunes for health plans depending on the final structure.

Sector	Better Off	Same	Worse Off
Pharmaceutical	39%	40%	21%
Health Plans	29%	30%	41%
Hospitals	16%	34%	50%
Physicians	12%	33%	55%
Consumers	8%	26%	66%
Employers	7%	35%	58%

From a historical perspective, here’s how respondents see health plans future prospects from year to year. Note that despite the potential of health reform, optimism for health plans returned a little this year, after pervasive pessimism from 2007 through 2009:

Health Plans:	Better Off	Same	Worse Off
2010	29%	30%	41%
2009	12%	44%	45%
2008	14%	36%	50%
2007	12%	41%	47%
2006	54%	35%	12%
2005	43%	42%	16%
2004	36%	50%	14%
2003	36%	44%	21%

* The Future Care survey incorporates respondents from MCOL Future Care Web Summit attendees and MCOL members. n = 131 for 2010, 90 for 2009, 127 for 2008, 146 for 2007, 267 for 2006, 110 for 2005; 118 for 2004; 139 for 2003

What to make of the CMS National Health Expenditure Report

by Clive Riddle, January 5, 2010

CMS’ Office of the Actuary today issued their annual report on the National Health Expenditure Accounts. CMS states the report contains good and bad news. On one hand, “nominal health spending in the United States grew 4.4 percent in 2008, to $2.3 trillion or $7,681 per person.  This was the slowest rate of growth since the Centers for Medicare & Medicaid Services started officially tracking expenditures in 1960.” On the other hand, “health care spending continued to outpace overall nominal economic growth, which grew by 2.6 percent in 2008 as measured by the Gross Domestic Product (GDP).”

CMS states that “the 4.4 percent growth in 2008 was down from 6.0 percent in 2007, as spending slowed for nearly all health care goods and services, particularly for hospitals. However, health spending as a share of the nation’s GDP continued to climb, reaching 16.2 percent in 2008, up 0.3 percentage points from 2007.” Jonathan Blum, CMS Director of Center for Medicare Management tells us “this report contains some welcome news and yet another warning sign. Health care spending as a percentage of GDP is rising at an unsustainable rate.”

One of the supplemental reports: the Nation's health dollar - where it came from, where it went, provides a nice brief summary pie chart that breaks down as follows:

The Nation’s Health Dollar, Calendar Year 2008: Where it Came From:

• Private Insurance - 33%
• Medicare - 20%
• Medicaid/SCHIP – 15%
• Other Public – 13%
• Out of Pocket – 12%
• Other Private – 7%

The Nation’s Health Dollar, Calendar Year 2008: Where it Went:

• Hospital Care - 31%
• Other Spending- 25%
• Physician and Clinical Services - 21%
• Prescription Drugs - 10%
•  Nursing Home Care - 6%
• Program Administration and Net Cost - 7%

Digging into other supplemental files provided with the report, it’s interesting to examine trends in the portion of public vs. private funding of spending, and the subset of private spending from consumer out of pocket payments, which we compiled as follows:

% of Total National Expenditure	2008	2005	2000	1995	1990	1980	1970	1960
Total Public Payments	47.3%	45.4%	44.1%	45.8%	40.2%	42.0%	37.5%	24.5%
Total Private Payments	52.7%	54.6%	55.9%	54.2%	59.8%	58.0%	62.5%	75.5%
Consumer Out-of-pocket	11.9%	12.5%	14.2%	14.4%	19.1%	22.9%	33.3%	46.9%

The continual shift between public and private funding is certainly apparent, as is the decline in the portion accounted by consumer out of pocket payments. While much has been made over ever increasing consumer cost sharing, that concern has been expressed in absolute, as opposed to relative terms. Relative to total national health expenditures, consumer out of pocket costs continue to decline as a percentage. Of course the shift towards private funding is the cause- as more consumers are covered by public vs private programs over time and public cost sharing requirements are generally much less than private cost sharing.

Here’s some other highlights CMS noted in regard to the actual numbers comprising where these dollars went or came from:

• Hospital spending in 2008 grew 4.5 % to $718.4 billion, compared to 5.9 % in 2007, the slowest rate of increase since 1998.
• Physician and clinical services’ spending increased 5.0 % in 2008, a deceleration from 5.8 % in 2007.
• Retail prescription drug spending growth also decelerated to 3.2 % in 2008 as per capita use of prescription medications declined slightly, mainly due to impacts of the recession, a low number of new product introductions, and safety and efficacy concerns.
• Spending growth for both nursing home and home health services decelerated in 2008.   For nursing homes, spending grew 4.6 % in 2008 compared to 5.8 % in 2007.
• Total health care spending by public programs, such as Medicare and Medicaid, grew 6.5 % in 2008, the same rate as in 2007.
• Health care spending by private sources of funds grew only 2.6 % in 2008 compared to 5.6 % in 2007.
• Private health insurance premiums grew 3.1 % in 2008, a deceleration from 4.4 % in 2007.

Survey on Plan, Provider and Vendor ICD10 Transition

By Clive Riddle, December 10, 2009

MCOL this week released results from an exclusive survey of HealthcareWebSummit participants in the ICD-10 web summit and other interested parties. Participants were asked to respond to four items:

1. Please categorize your organization.
2. When do your project your organization will complete transition to ICD-10?
3. How prepared is your organization at this point for transition to ICD-10?
4. Is your organization undertaking other IT or Administrative initiatives to leverage use of the ICD-10 codes?

Here’s what the survey found:

• Overall, only 3.1% of respondents indicated that their organization had completed the transition to ICD-10 while a plurality of respondents, 26.15% projected their organizations would complete the transition in 2013.  A majority (55.3%) of respondents projected their organization to complete transition sometime between 2010 and 2012 (21.5% in 2010; 20.0% in 2011; 13.8% in 2012.)

• A majority (58.7%) of respondents considered their organization to be prepared for transition to ICD-10, with 14.3% indicating being very prepared and 44.4% being somewhat prepared. (17.5% stated unprepared, 14.3% very unprepared and 9.5% were unsure or not applicable.)

• 62.5% respondents indicated that their organization were either undertaking other IT or administrative initiatives to leverage use of the ICD-10 codes (34.4%) or at least considering doing so (28.1%.)

• Responses, in some instances, varied materially by category of respondent.  Those respondents who listed their organization as vendor were not only more prepared for transition than providers or payers, but also projected that they would complete transition sooner and were more likely to be undertaking other IT or administrative initiatives. 

• While payors were more likely than providers to be very prepared for transition, providers were more likely to be some degree of prepared with 55% listing their organization as somewhat prepared.

• General category of respondents (N = 66):
  • Payor              33.3%
  • Provider          31.8%
  • Vendor/Other   34.9%

The Disparity between State Health Rankings

By Clive Riddle, November 19, 2009

How much difference is there between overall health care performance rankings of states, conducted by major organizations? I thought I’d peek into two recent studies and compare them. Interestingly, the two studies both agreed on who was first (Vermont), who was last (Mississippi), generally agreed on this highest and lowest ranking states, but agreed on little in-between.

This week, United Health Foundation, the American Public Health Association and Partnership for Prevention released the 20^th Anniversary Edition of America’s Health Rankings. The full report can be downloaded, or drop-down queries can be made from www.americashealthrankings.org. 

Their press release states that the rankings “provide an analysis of national health on a state-by-state basis by evaluating a historical and comprehensive set of health, environmental and socio-economic data to determine national health benchmarks and state rankings. The Rankings employs a unique methodology, developed and annually reviewed by a Scientific Advisory Committee of leading public health scholars.” 21 core measures and 15 supplemental measures were used, categorized into determinants including Behaviors, Community Environment, Public and Health Policies, Clinical Care, and Outcomes.

Last month, The Commonwealth Fund released their report "Aiming Higher: Results from the 2009 State Scorecard on Health System Performance." This is a comparative follow up to their 2007 state scorecard report. The report has been released in the context of health reform, with the finding that there continues to be significant disparities between states regarding a wide number of health care measures. The Commonwealth Fund states their report "includes 38 indicators grouped into five dimensions of performance—access, prevention/treatment quality, avoidable hospital use and costs, equity, and healthy lives. The analysis ranks states on each indicator and then averages the indicator ranks to determine the dimension rank. Dimension scores determine the overall rank. Equity measures the gaps in performance between vulnerable groups and the national average."

So I compiled the overall state rankings for both reports (but I encourage you to review the individual measures in both reports- it gets more meaningful when you examine the specifics.) I indicated the absolute difference in rankings between the reports for each state (factoring out DC which was included in the Commonwealth report but not America’s Health Rankings- also it should be noted there are duplicate rankings in both reports when states tied.)

The exercise kind of reminded me of the college football ranking comparisons displayed this time of year with the BCS, AP and Harris polls.

State	Commonwealth	America's	Difference
Alabama	39	48	9
Alaska	33	34	1
Arizona	35	27	8
Arkansas	47	40	7
California	30	23	7
Colorado	24	8	16
Connecticut	8	7	1
Delaware	14	32	18
Florida	42	36	6
Georgia	36	43	7
Hawaii	2	4	2
Idaho	28	14	14
Illinois	41	29	12
Indiana	27	35	8
Iowa	2	15	13
Kansas	23	24	1
Kentucky	44	41	3
Louisiana	48	47	1
Maine	5	9	4
Maryland	17	21	4
Massachusetts	7	2	5
Michigan	20	30	10
Minnesota	4	5	1
Mississippi	50	50	0
Missouri	36	38	2
Montana	18	26	8
Nebraska	13	16	3
Nevada	46	45	1
New Hampshire	5	5	0
New Jersey	29	18	11
New Mexico	42	31	11
New York	21	25	4
North Carolina	40	37	3
North Dakota	9	17	8
Ohio	26	33	7
Oklahoma	49	49	0
Oregon	31	13	18
Pennsylvania	15	28	13
Rhode Island	11	10	1
South Carolina	32	46	14
South Dakota	12	20	8
Tennessee	38	44	6
Texas	45	39	6
Utah	19	2	17
Vermont	1	1	0
Virginia	22	22	0
Washington	16	11	5
West Virginia	34	42	8
Wisconsin	10	12	2
Wyoming	25	19	6

Commonwealth Fund International Survey of Primary Care Physicians

by Clive Riddle, November 6, 2009

The Commonwealth Fund this week released their report: A Survey of Primary Care Physicians in 11 Countries, 2009: Perspectives on Care, Costs, and Experiences which compares U.S. primary care physician attributes to those in Europe, Australia, New Zealand and Canada.

Harris Interactive and subcontractors conducted the surveys via mail, phone and internet earlier this year, with results reported from over 10,000  primary care doctors, including 1,016 in in Australia, 1,401 in Canada, 502 in France, 715 in Germany, 844 in Italy, 614 in Netherlands, 500 in New Zealand, 774 in Norway, 1,450 in Sweden, 1,062 in the U.K., and 1,442 in the U.S.

The Commonwealth Fund press release on the report shaped their study in the context of health reform. Cathy Schoen, Commonwealth Fund Senior Vice President and lead author tells us "we spend far more than any of the other countries in the survey, yet a majority of U.S. primary care doctors say their patients often can’t afford care, and a wide majority of primary care physicians don’t have advanced computer systems to access patient test results, anticipate and avoid medication errors, or support care for chronically ill patients. The patient-centered chronic care model originated in the U.S., yet other countries are moving forward faster to support care teams including nurses, spending time with patients, and assuring access to after-hours. The study underscores the pressing need for national reforms to close the performance gap to improve outcomes and reduce costs." Commonwealth Fund President Karen Davis adds “access barriers, lack of information, and inadequate financial support for preventive and chronic care undermine primary care doctors' efforts to provide timely, high quality care and put the U.S. far behind what many other countries are able to achieve. Our weak primary care system puts patients at risk, and results in poorer health outcomes, and higher costs. The survey provides yet another reminder of the urgent need for reforms that make accessible, high-quality primary care a national priority."

Here’s a few highlights the Commonwealth Fund pointed out from their report:

• More than half of U.S. physicians (58%) report their patients often have difficulty paying for medications or other out-of-pocket costs, compared to between 5 percent and 37 percent in the other countries.

• Twenty-eight percent of U.S. doctors report their patients often face long waits to see a specialist—a rate similar to that reported by Australian (35%) and U.K. (22%) physicians, the lowest rates in the survey

• Just 29 percent of U.S. doctors report any arrangement for patients to see a doctor or nurse after hours, a drop from 40 percent in the 2006 Commonwealth Fund International Health Policy Survey. In contrast, nearly all doctors in the Netherlands (97%), and large majorities in New Zealand (89%) and the U.K (89%) report after-hour provision.

• While nearly half (46%) of U.S. primary care doctors report using electronic medical records (EMRs)—up from 28 percent in 2006—U.S. primary care practices, along with Canadian doctors, continue to lag well behind other leading countries.

• Primary care physicians in the U.S., are among the least likely to report that they receive financial incentives for quality improvement, such as bonuses for achieving high patient satisfaction ratings, increasing preventive care, use of teams, or managing patients with chronic disease or complex needs.

• Teams that include health professionals such as nurses serve an important role in managing care, especially for chronic conditions. The survey results indicate that use of teams including nurses and other health professionals to manage care, especially for chronic conditions,  is widespread in Sweden (98%), the U.K, (98%) and many other countries but was far less frequent in the United States (59%), Canada (52%), and France (11%)

• Asked about comparative information systems, doctors in the U.K. are most likely to routinely receive and review data on clinical outcomes (89%), followed by Sweden (71%), New Zealand (68%), and the Netherlands (65%). Less than half of doctors in other surveyed countries—including the U.S. at 43 percent—report such reviews.

• U.K physicians (65%) were by far the most likely to report they receive data on how they compare to other practices and, along with Sweden and New Zealand doctors, the most likely to have information on patient experiences. Notably, U.S. doctors lagged well behind these leading countries on feedback on both clinical quality and patient experiences.

I compiled some selected key issues addressed in the survey into a table, to make it easier to compare various primary care responses by country. While the Commonwealth Fund does go out of their way to paint the U.S, “system” in a bad light as fodder for reform, and perhaps glosses over that U.S. Access to Care isn’t comparatively that bad (refer to specialist wait times below) it is hard to argue we don’t have a lot of room for improvement across the board.

Country	(1) EHRs	(2) Patient Reminders	(3) Rx Costs	(4) Long Specialist Waits	(5) Patient Rx List	(6) Outcome Data	(7) Financial Incentives
Australia	95%	89%	23%	34%	12%	24%	65%
Canada	37%	31%	27%	75%	16%	17%	62%
France	68%	60%	17%	53%	43%	12%	50%
Germany	72%	32%	28%	66%	66%	41%	58%
Italy	94%	33%	37%	75%	59%	40%	70%
Netherlands	99%	80%	33%	36%	4%	65%	81%
New Zealand	97%	97%	25%	45%	5%	68%	80%
Norway	97%	15%	5%	55%	20%	25%	35%
Sweden	94%	51%	6%	63%	29%	71%	10%
United Kingdom	96%	97%	14%	22%	83%	89%	89%
United States	46%	47%	58%	28%	30%	43%	36%

(1) MDs using EHRs

(2) Send Patient Reminders for Preventive/Follow Up Care

(3) Patients have difficulty paying for medications

(4) Patients have long wait times to see specialists

(5) Routinely provide patients list of all medications

(6) Routinely receives/reviews patient outcome data

(7) Can receive various Financial incentives

Comparing HDHP, HMO and PPO Value based on Employer Benefit Survey Data

By Clive Riddle, October 7, 2009

The Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2009 was released a couple of weeks ago.  The annual survey is a must read for any professional interested in employer health benefit issues and is packed with data.

I thought it would be interesting to use the data to compare the value of HDHPs to HMOs and PPOs, realizing of course for any individual’s actual situation, you’d need to compare specific benefit and premium parameters of specific plans. Also, this doesn’t take into consideration if there were any employer contribution to an HRA or HSA account in conjunction with the HDHP, or tax advantaged employee contributions were made to the account. But the survey data can still provide an overall sense of the industry-wide value of each plan type on the basis of premium and deductible comparisons.

Here’s ratios of single premium by plan type, compiled from the survey data.

HMO Premiums 1.011
PPO Premiums   1.020
POS Premiums   1.002
HDHP Premium 0.826
Overall Average 1.000 ($402 per month)

So based on the survey data does the HDHP premium, at 82.6% of the overall average premium, justify itself when the deductible cost sharing is taken into account? Let’s compare, based on single premium and deductible data.

HMOs: The survey data indicates that 84% of HMOs have no deductible requirement, and that those who do have an average of a $699 annual deductible. This yields a weighted average (16% * $699) of a $111.84 deductible for all HMOs. The survey data indicates that the average HDHP deductible is $1,838. Thus the net annual difference in deductibles is $1,726.16.

For simplicity, assuming that the HMO and HDHP copay/coinsurance requirements, benefit limitations and maximums after the deductible is met are in the same ballpark (which of course often isn’t the case) we’ll compare the value of an HMO to HDHPs solely on premium versus deductible differential.

The total annual difference in premiums based on the survey data is $892 ($4,878 annual HMO premium versus $3,986 HDHP premium). If you were to consume the entire HDHP deductible amount, the HMO would save you $834 (the deductible difference of $1,726 less the premium difference of $892.

But another way of looking at it is the HDHP would save you $892 if your total annual health expenditures for the year were less than $111.84 (the average HMO deductible amount.) Assuming an equivalent coinsurance rate of 18% after the deductible is met, meaning that 82 cents of each dollar consumed after $111.84 (the HMO avg deductible) would be reduced from the $892 savings for the HDHP. This means that once you spent an additional $1,087.80 ($892 divided by 82%) the savings stop. This equates to total annual health claims of $1,199.64 ($1,087.80 + the $111.84 avg HMO deductible.)

So you’d have to gamble that your annual health claims would costs less $1,200, or 65% of the HDHP deductible requirement in order for the HDHP to save you any money compared to an HMO.

Traditional PPOs: Using the same methodology, the survey data indicates that 26% of PPOs have no deductible requirement, and those who do have an average $634 deductible, yielding a weighted average $469 deductible for all PPOs, and an annual net difference of $1,368.84 compared to the HDHP deductible. The total annual difference is premiums based on the survey data is $936 (the PPO annual premium is $4,922).

So if you were to consume the entire HDHP premium, the PPO would save you $432.84  ($1,368.84 less $936). The HDHP would save you $936 if your total annual health expenditures for the year were less than $469 (the average PPO deductible amount.) Assuming an equivalent coinsurance rate of 18% after the deductible is met, meaning that 82 cents of each dollar consumed after $469 (the PPO avg deductible) would be reduced from the $936 savings for the HDHP. This means that once you spent an additional $1,141.46 ($936 divided by 82%) the savings stop. This equates to total annual health claims of $1,610.46 ($1141.46 + the $469 avg HMO deductible.)

So you’d have to gamble that your annual health claims would costs less $1,610, or 87.5% of the HDHP deductible requirement in order for the HDHP to save you any money compared to a traditional PPO.

Checking out CMS’ Hospital Compare

 By Clive Riddle, July t6, 2009

Last week, CMS issued an announcement touting “important new information was added to the Centers for Medicare & Medicaid Services’ (CMS) Hospital Compare Web site that reports how frequently patients return to a hospital after being discharged, a possible indicator of how well the facility did the first time around” They noted around 20% of hospitalized Medicare beneficiaries experience a readmission within 30 days from discharge.

This prompted me to take the opportunity to check out Hospital Compare again, and see what was going on in that cyber neck of the woods. Here’s a few things I learned:

• The tool is being used. Hospital Compare has been on-line since 2005. Last year the site 18 million+ page views, and is receiving around 1 million page views monthly during 2009.
• Here’s how CMS describes the what information Hospital Compare provides: “The Hospital Compare Web site will show a hospital’s mortality or readmissions rate is ‘Better than,’ ‘No different from,’ or ‘Worse than’ the U.S. national rate...Hospital Compare also includes 10 measures that capture patient satisfaction with hospital care, 25 process of care measures, and two children’s asthma care measures. The site also features information about the number of selected elective hospital procedures provided to patients and what Medicare pays for those services.”
• So what are you supposed to do with this information? CMS states that “Public reporting of these and other measures is intended to empower patients and their families with information they need to engage their local hospitals and physicians in active discussions about quality of care..” Charlene Frizzera, CMS Acting Administrator, tells us "Providing readmission rates by hospital will give consumers even better information with which to compare local providers. Readmission rates will help consumers identify those providers in the community who are furnishing high-value healthcare with the best results. CMS believes that all hospitals, regardless of their readmission and mortality rates, should use the data available in these free, detailed reports to find ways to continually improve the care they deliver.”
• Of course, has lawyers on staff, and the hospital web site counsels us that we really shouldn’t “view any one process or outcome measure on Hospital Compare as a tool to ‘shop’ for a hospital” and that “consumers should gather information from multiple sources when choosing a hospital.”
• If you really want to swim around in the hospital compare data, they do provide the option to download the entire database (9MB).
• How old is the data, and how often is it updated? The collection period for the process of care quality measures is generally 12 months. Currently, the Hospital Compare quality measures are refreshed the third month of each quarter. The collection period for the mortality and readmission measures is 36 months. The risk-adjusted 30-day risk-adjusted mortality and readmission measures for heart attack, heart failure and pneumonia are produced from Medicare claims and enrollment data. The mortality and readmission quality measures will be refreshed once annually.
• Downloading and then sifting through the actual database, I came across a table summarizing the national averages (as opposed to the hospital and state specific averages typically displayed in the online reports, or national data just for a specific item. Below are tables with the national HCAHPS (Hospital Consumer Assessment of Healthcare Providers and Systems) survey data and the national mortality readmission data.

HCAHPS Measures	HCAHPS Response Categories	Overall Survey %Response Rate
How often were the patients rooms and bathrooms kept clean?	Room was always clean	69%
How often were the patients rooms and bathrooms kept clean?	Room was sometimes or never clean	10%
How often were the patients rooms and bathrooms kept clean?	Room was usually clean	21%
How often did nurses communicate well with patients?	Nurses always communicated well	74%
How often did nurses communicate well with patients?	Nurses sometimes or never communicated well	6%
How often did nurses communicate well with patients?	Nurses usually communicated well	20%
How often did doctors communicate well with patients?	Doctors always communicated well	80%
How often did doctors communicate well with patients?	Doctors sometimes or never communicated well	5%
How often did doctors communicate well with patients?	Doctors usually communicated well	15%
How often did patients receive help quickly from hospital staff?	Patients always received help as soon as they wanted	62%
How often did patients receive help quickly from hospital staff?	Patients sometimes or never received help as soon as they wanted	12%
How often did patients receive help quickly from hospital staff?	Patients usually received help as soon as they wanted	26%
How often was patients pain well controlled?	Pain was always well controlled	68%
How often was patients pain well controlled?	Pain was sometimes or never well controlled	8%
How often was patients pain well controlled?	Pain was usually well controlled	24%
How often did staff explain about medicines before giving them to patients?	Staff always explained	59%
How often did staff explain about medicines before giving them to patients?	Staff sometimes or never explained	23%
How often did staff explain about medicines before giving them to patients?	Staff usually explained	18%
Were patients given information about what to do during their recovery at home?	No, staff did not give patients this information	20%
Were patients given information about what to do during their recovery at home?	Yes, staff did give patients this information	80%
How do patients rate the hospital overall?	Patients who gave a rating of 6 or lower (low)	10%
How do patients rate the hospital overall?	Patients who gave a rating of 7 or 8 (medium)	26%
How do patients rate the hospital overall?	Patients who gave a rating of 9 or 10 (high)	64%
How often was the area around patients rooms kept quiet at night?	Always quiet at night	56%
How often was the area around patients rooms kept quiet at night?	Sometimes or never quiet at night	13%
How often was the area around patients rooms kept quiet at night?	Usually quiet at night	31%
Would patients recommend the hospital to friends and family?	NO, patients would not recommend the hospital (they probably would not or definitely would not recommend it)	6%
Would patients recommend the hospital to friends and family?	YES, patients would definitely recommend the hospital	68%
Would patients recommend the hospital to friends and family?	YES, patients would probably recommend the hospital	26%

Condition	Measure Name	National Mortality_Readm Rate
Heart Attack	Hospital 30-Day Death (Mortality) Rates for Heart Attack	16.6
Heart Attack	Hospital 30-Day Readmission Rates for Heart Attack	19.9
Heart Failure	Hospital 30-Day Death (Mortality) Rates for Heart Failure	11.1
Heart Failure	Hospital 30-Day Readmission Rates for Heart Failure	24.5
Pneumonia	Hospital 30-Day Death (Mortality) Rates for Pneumonia	11.5
Pneumonia	Hospital 30-Day Readmission Rates for Pneumonia	18.2

The Future Ain’t What It Used to Be

By Clive Riddle, February 5, 2008

A couple of weeks ago, MCOL in conjunction with the Seventh Future Care Web Summit, conducted its annual e-poll on health care trends for the coming year and beyond. As the same three basic questions are asked each year, results have been tracked since 2003. So, given the massive change in the economy during the past twelve months, how do health care executives and other professionals feel about the future?

Answers were not that surprising to the questions: (1) which trends will have the greatest overall impact in 2009; and (2) which predicted trend is least likely to have an impact in 2009. But I was taken aback somewhat with answers to the question which stakeholders will be better off, worse off, or the same in 2009.

Comparing current answers with previous years is difficult, for the first question: "Which of the following health care business trends do you think will have the greatest overall impact in 2008?" That’s because “Effects of the Recession” was contemplated as a trend in previous years, and over half (57.3%) of respondents list that as the trend that will have the greatest impact, and I would agree with them.

Here’s a table listing responses to this question since 2003:

Trend	2009	2008	2007	2006	2005	2004	2003
Advances in health care technology	3.4%	11.8%	7.5%	16.6%	13.6%	11.9%	10.8%
Consumer Driven health plans	3.4%	13.4%	18.5.%	21.0%	22.7%	14.4%	15.1%
Compliance issues	1.1%	0.8%	3.4%	0.8%	0.9%	5.9%	18.0%
Effects of the Recession	57.3%	NA	NA	NA	NA	NA	NA
Health Care Reform Initiatives	21.3%	23.6%	11.0%	28.1%	13.6%	4.3%	N/A
Increased consumer cost sharing	9.0%	33.9%	40.4%	25.8%	38.2%	35.6%	38.8%
Disease Management initiatives	3.4%	12.6%	7.5%	3.0%	5.5%	23.7%	N/A
Other	1.1%	3.9%	11.6%	4.5%	5.5%	4.2%	17.3%
Grand Total	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%

One way to compare any of the other trends(which have been listed each year) with previous years, you need to multiply this year’s response by two, or divide pervious year’s in half, to factor in this year’s new Recession trend that was missing before. When you do that, it makes the runner-up choice (health care reform initiatives, with 21.3% in 2009) all that more prominent. While all other trends dropped to around a third of their previous levels (except compliance, which still only weighed in at 1.1%) reform stayed basically the same as last year.

So the conclusion for 2009 not surprisingly, is forget everything else, two “R’s - recession and reform, will dominate this year in health care.

When asked “which of the following predicted trends do you feel is least likely to occur or have an impact in the next two years,” respondents had little consensus regarding any particular trend. What is interesting, however, is to compare these answers to previous years.

Here’s a table listing responses to this question since 2003:

Trend	2009	2008	2007	2006	2005	2004	2003
Health Plan cost sharing will level off/slow down	11.2%	15.0%	11.0%	13.1%	19.3%	18.6%	9.5%
Major growth of Consumerism initiatives including consumer driven plans	22.5%	15.0%	17.8%	15.4%	14.7%	12.7%	18.2%
Major advances in patient/provider/plan electronic data transfer	15.7%	22.0%	14.4%	14.2%	16.5%	20.3%	20.4%
Significant National Health Care Reform Legislation will be Enacted*	21.3%	14.2%	16.4%	13.5%	22.9%	11.9%	22.6%
Premium Increases will continue to slow down	22.5%	23.6%	23.3%	30.7%	14.7%	22.9%	N/A
Further growth/adoption of disease management and wellness	6.7%	12.6%	16.4%	12.7%	11.0%	13.6%	N/A
Medicare HMO reforms	N/A	N/A	N/A	N/A	N/A	N/A	15.3%
Medicare prescription drug coverage	N/A	N/A	N/A	N/A	N/A	N/A	13.1%
Hospital Medicare Outlier Payment Reform	N/A	N/A	N/A	N/A	N/A	18.6%	9.5%
Other	0.0%	3.9%	0.7%	0.1%	0.9%	0.0%	0.7%
Grand Total	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%	100.0%

As you can see, despite the significant segment that views reform as a trend with the greatest overall impact for 2009, the “doubters” have increased in the past year as well. Last year, as the election season was heating up, 14.2% felt reform would be the trend least likely to happen. This year, that number rose to 21.3%.

Also, interestingly, doubts regarding the last most significant innovation have increased. In 2008, 15.0% listed growth in consumerism as the trend least likely to occur or have an impact; that number increased to 22.5% in 2009. But optimism must be increasing for electronic data transfer. In 2008, 22.0% listed this as the least likely trend; that number decreased to 15.7% in 2009.

The conclusions to this aren’t that surprising either: 1) there are plenty of cynics mixed in with those sure that reform will take place; 2) perhaps because consumerism was politically as a Republican agenda, and now we are facing a Democratic agenda, a growing number think Consumerism initiatives will wane; and 3) given the priority the Obama team is giving electronic health records and data transfer, there is less cynicism that this will eventually happen.

I mentioned that I was surprised by answers to the third question: “Which of the following stakeholders do you view as being better off, the same or worse off in the coming year?” Of course, respondents think things are going to be bad all the way around. I just thought they’d be even more negative.

While as expected, few answered “better off” for any category of stakeholder, the level that answered “same” (as opposed to “worse off”) was surprising. I would have expected a resounding “worse off” response for all categories. Even more perplexing was to when these responses were compared to previous years. The change simply wasn’t as large as I would have thought, and consumers were strangely rated in better position for 2009 versus 2008. Perhaps this is due to the specter of reform?

Here’s tables listing responses to this question, compared to the past two years:

2009 Winners and Losers:

By Next Year:	Better Off	Same	Worse Off	Grand Total
Consumers	16.9%	14.6%	68.5%	100.0%
Employers	8.0%	25.0%	67.0%	100.0%
Physician	5.7%	40.2%	54.0%	100.0%
Hospital	3.4%	35.2%	61.4%	100.0%
Health Plans	11.5%	43.7%	44.8%	100.0%
Pharmaceutical	20.5%	44.3%	35.2%	100.0%

2008 Winners and Losers:

By Next Year:	Better Off	Same	Worse Off	Grand Total
Consumers	6.5%	18.2%	75.3%	100.0%
Employers	20.5%	32.1%	47.4%	100.0%
Physician	46.2%	41.0%	12.8%	100.0%
Hospital	21.8%	37.2%	41.0%	100.0%
Health Plans	14.1%	35.9%	50.0%	100.0%
Pharmaceutical	49.4%	32.5%	16.9%	100.0%

2007 Winners and Losers:

By Next Year:	Better Off	Same	Worse Off	Grand Total
Consumers	7.6%	20.7%	71.7%	100.0%
Employers	19.9%	45.2%	34.9%	100.0%
Physician	46.6%	42.5%	11.0%	100.0%
Hospital	17.8%	37.0%	45.2%	100.0%
Health Plans	11.7%	41.4%	46.9%	100.0%
Pharmaceutical	38.9%	31.9%	29.2%	100.0%

Now, that the books are closed on the first month of the last year of the decade, we don’t have to speculate much more on what 2009 will bring. We can just make sure our seat restraints are locked in position, and hang on for the ride.

The Great Recession: as seen by Health Plan Executives

by Clive Riddle

There have been a number of depressions in the American economy since the days of Alexander Hamilton. We only refer to one as the “Great Depression,” and it seems joined at the hip with an entire decade (the 1930’s.) There have been a wide number and range of recessions in American history. It’s hard to know how today this one will fully play out, but it feels different. Perhaps we’ll move on from calling our current situation the “Current Financial Crisis” and we’ll end up calling this the “Great Recession.”

CSC yesterday released results from their November 2008 survey of 30 senior executives representing 26 health plans, with their report "Insuring the Future: Health Plans Respond to the Financial Crisis." Here’s what they found was going on in the minds of our health plan executives relating to whatever you want to call our economic mess; the following is a summary of the questions asked, survey results, and our comments:

• “Compared to 2001 – 2002, how will the current economic downturn impact your organization?” 73% answered “Bigger Impact; 13% said “About the Same” and 13% answered “Smaller Impact”, “No Impact” or “No Opinion.” [so three-fourths might agree with calling this a Great Recession.]

• “Which indicator does your organization use to predict and plan for the effects of overall economic changes?” 69% mentioned unemployment; 55% mentioned health care inflation; 31% mentioned investment performance and the answers tailed off from there [makes sense- employment drives membership, inflation drives the medical loss ration, and investment income is the difference between profit and a loss for many plans.]

• “What is your organization’s response to the downturn?” 48% will implement cost-cutting projects; 41% will implement revenue enhancing projects; and14% will lay off staff. [Revenue enhancement is going to be a challenge in this economic climate if premium increases are what they have in mind. We would project a drastic reduction in negotiated premium increases, let alone benefit buy-downs that will reduce revenue.]

• “How has the downturn affected demand for your products?” Regarding enrollment, 48% anticipate an increase in individual product enrollment vs. 10% projecting a decrease; while 45% predict a decrease in group sales compared to 7% projecting an increase [what are these 7% smoking, or maybe they just think their going to steal away competitors market share?]; and 69% project an increase in government program enrollment compared to 14% predicting a decrease. Relating to employer group renewals, 54% anticipate a decrease in small business renewals, and 31% project decreases in large group renewals [so the small group market will make significant cuts in providing coverage or eligibility, driving the individual and government program increases, and the group market will continue to diminish in size as it has this throughout this decade.]

• Also regarding the demand for product type, 67% see an increase in demand for Consumer Driven plans compared to 5% anticipating a decrease, compared to 29% increase/24% decrease for PPOs and 43% increase/14% decrease for HMOs. [So consumer driven plans, which many pundits have seen as an endangered species with the new Democratic administration and congress may still have some legs due to the impact of this recession, and HMOs may make a comeback from the managed care backlash starting ten years ago, as a stronger tool to stabilize costs.]

• “How will the economic downturn affect other business partners?” 73% anticipate cashflow/solvency problems with provider networks, and 54% predict network stability problems relating to access and availability. [As provider networks serve multiple plans, you can have a reverse supply chain problem compared to the auto industry. With autos, a collapse of the manufacturers can bring down the supply chain. Here a collapse of the provider network supply chain could wreak havoc with the health plans.]

Of course, how one sees the economic situation depends upon one’s personal stake and position at the time. The joke goes, a definition of a recession is when you lose your job. The definition of a depression is when I lose my job.