America's Choice Healthplans (From Employee Benefit News)

New model applies Internet to realize managed care's potential

By Clelland Green

The emergence of improved technology is changing the face of health care in the United States. Nowhere is this trend more dramatic than in e-Health applications.

"Self-directed health plans shift risk, cost to workers" - ACH in the Christian Science Monitor
August 12, 2002

"Uncovering Unbundling" - Article Featured in Human Resource Executive
May 3, 2002

"40 under 40" - Philadelphia Business Journal lists Clelland Green
March 29, 2002

ACH CEO Named to CareGain Board of Advisors
February 26, 2002

New model applies Internet to realize managed care's potential
November 1, 2001

Inc 500 rates America's Choice in country's top 500 growing companies
October 30, 2001

Philadelphia Business Journal features America's Choice
October 29, 2001

Philadelphia Inquirer features America's Choice
April 9, 2001

ACH Newsroom Main Page

To date, most of the emphasis has been on using the Internet to expedite administrative tasks such as managing eligibility, finding a provider or checking the status of a claim. These types of enhancements have been effective in reducing costs and increasing patient and payor satisfaction.

However, they are only a first step. The real power of the Internet lies in its ability to positively impact health - and thereby health care costs - by providing payors, patients and providers with actionable health information.

This message is especially critical for employers. Large employer health care costs are projected to increase 13% in 2001 - and to continue rising at double-digit rates in each of the next several years, tracking national health care costs and projections as calculated by the federal government. Moreover, productivity, corporate profits and competitive advantage are increasingly tied to employee wellness and the optimal use of health care services. The global economy and new forces of production will demand that employers invest wisely in their employees' overall health status.

While general health information abounds online, the Internet is only slowly being adopted as a credible health improvement tool. The latter requires providing tailored information that is specific to the individual or targeted population in a way that promotes action. Often this is easier said than done.

This has created an opportunity for innovative new players. Unwilling to wait for old technology to be updated, these organizations are introducing next generation health care service models that harness e-health technology to increase the efficacy of traditional managed care programs.

Since using the Internet to positively impact health is still in its infancy, the rigorous clinical studies necessary to prove efficacy are only now getting under way. However, a significant body of research has guided the development of the new health care service models. That research, along with preliminary evidence from the new models themselves, suggests that smart use of technology can, indeed, result in improved health and in lower health care costs.

While the effects can be seen in several areas, the focus here is on four of the most significant: wellness and health risk reduction, disease management for chronic conditions, pharmaceutical interventions and empowering consumers to choose the most appropriate level and provider of care.

Focused interventions

One of the most powerful uses of the Internet is to provide payors with current data about health care utilization, health risks and opportunities for targeted interventions. This is particularly effective for employer payors, who are automatically incentivized to take action. Not only do they pay health care claims, but absenteeism, disability, on-the-job productivity and morale are all affected by employee health.

Armed with this evidence, payors can maximize their return on investment by focusing health interventions where they can be most effective in the shortest time frame and among the highest risks. The results in a number of areas can be significant.

Improved outcomes: Preliminary data shows that rapid identification of pregnant women for early care results in pre-term deliveries of 1% compared to national averages of 12%.

Even for conditions that wouldn't appear to be as timesensitive as pregnancy, it stands to reason that employees benefit from early interventions that lead them to take actions sooner, rather than later, to reduce their health risks or begin a course of care. This is validated by research showing that early detection and intervention programs, such as those for breast cancer, colorectal cancer, high blood pressure, cholesterol and depression, do indeed lengthen and save lives.

Lower health care costs: It is a truism that 15% of the population consumes roughly 85% of all health care services. According to the most recent estimates available from probability sample surveys, over 90 million Americans in 1987 were affected by a chronic health condition.

Many of these conditions are preventable. Recent estimates based on epidemiological evidence suggest that as much as 30% of avoidable human cancer is attributable to tobacco use and perhaps again as much to improper diet and nutrition.

Despite this evidence, some payors have been cautious in their investment in risk reduction programs, recognizing that the resulting disease may not materialize for 20 years or more - long after the individual may have moved on to another employer or health plan.

The methodology for studying health risks in relation to health care utilization is still evolving.

In one study, a consortium of six employers, including Chevron Corporation, Health Trust, Inc., Hoffmann-La Roche Inc., Marriott, the State of Michigan, and the State of Tennessee, found higher annual expenditures among persons who reported themselves as depressed (70% higher expenditures than the median), at high stress (46% higher), with high blood glucose levels (35%), at extremely high or low body weight (21%), former (20%) and current (14%) tobacco users, with high blood pressure (12%), and with sedentary lifestyle (10%).

A second assessment of some 5,500 members enrolled in a health plan in Minnesota used paid claims to demonstrate that unhealthy lifestyle risks are associated with higher short-term health expenditures. After adjusting for age, race, sex and chronic disease status, this assessment found evidence of increased short-term health care costs due to overweight status (1.9% higher charges per Body Mass Index unit), current smoking status (18% higher charges) and history of tobacco use (25.8% higher charges).

A number of studies, including the respected study of Steelcase employees by University of Michigan researchers, have confirmed that when health risk profiles change - either positively or negatively - costs move in the same direction.

The effect on costs can be seen surprisingly quickly. Researchers previously believed there was a lag of as much as three years between when an individual's risk status changed and when the resulting effect on health care costs was realized. However, emerging data from the University of Michigan's Health Management Research Center suggest that changes in health care costs are seen much sooner - in less than one year in some cases.

Given that the cost of a targeted risk reduction program is about the same regardless of when it is begun, this accelerated cost-savings goes directly to the bottom line.

Absenteeism & productivity: It seems logical that employees who have higher health risks and health care costs would contribute a disproportionate share to absenteeism and lost on-the-job productivity, and indeed, a number of studies confirm that this is the case.

Worksite health promotion programs targeting stress and other health-related risk factors have proven highly effective, particularly those based on integrated and combined techniques such as biofeedback, muscle relaxation and coping skills.

Other types of interventions also have been shown to yield near-term employee performance gains, including interventions for depression, back pain, smoking and adult vaccination for influenza.

The evidence of financial impact tied to health management programs has become even stronger based on a recent study of Citibank employees invited to participate in a comprehensive program at work. Based on measures of medical expenditures before and after Citibank's program was implemented, an economic analysis showed a 4 to 1 return on investment. That is, for every dollar Citibank invested in program intervention costs, they realized 4 dollars in savings from avoided medical expenditures.

Online disease management

Disease management of chronic conditions is another area where e-health is having a significant impact. According to the Institute for Health and Productivity Management, chronic conditions account for $425 billion in direct medical claims costs and an estimated $234 billion more in productivity losses annually.

As is the case with wellness and risk reduction programs, disease management programs typically focus on chronic conditions where engaging patients to participate in managing their conditions can improve (or maintain) their functional status.

For example, patients' willingness to participate in their own self-care is one of the most important elements for successfully managing diabetes. Intensive diabetes treatment requires patients to closely monitor their blood glucose levels, diet and weight and, in some cases, to self-administer insulin. A disease management program that includes tracking tools, health information, reminders and support can help keep patients compliant and identify areas of concern before they become major problems.

Indeed, disease management programs have proven efficacy for improving disease state management skills among patients with asthma, insulin dependent diabetes mellitus, congestive heart failure and various behavioral disorders. It is reasonable to conclude that the same methodologies that proved effective with these conditions would be effective with other diseases that benefit from a similar level of patient involvement.

Online benefits administrators' disease management programs, such as the one created by America's Choice Healthplans, builds on techniques that have yielded results in traditional offline interventions. They leverage the power and widespread distribution of Web access to deliver proven models of patient-centric interventions that are capable of engaging a variety of patients through ongoing, continuous participation in the development of skills and tracking tools to better manage their health status.

Since research has shown that the vast majority of e-health users turn to the Internet only when they have a specific health question, online benefits administrators supplement their web initiatives with telephone calls from live nurse coaches who provide ongoing reminders and urge patients who could benefit from online disease management services to make them part of their regular routine.

Patients have been receptive. Even in the absence of disease management programs, patients with chronic conditions are among the most active users of the Internet for medical information.

And, the Internet is expected to grow in importance as a delivery medium and self-management tool for disease management. "In fact, the Internet, which has already proved its usefulness as a platform for managing relationships with individual customers in a wide range of industries, is likely to become the most powerful means of reaching and interacting directly with patients," according to The Boston Consulting Group.

While an entire arm of health services research science is currently working to measure the clinical efficacy of web-based disease management, it seems reasonable to assume that a medium that engages patients in their own health care, gives them 24/7 access to reliable patient-centric information, puts the tools to track and manage their condition at their fingertips and provides frequent reminders will prove effective in helping patients improve their functional status and quality of life.

The next step for online disease management will be to more actively involve patients' own physicians as issues of privacy and technology are resolved. The newest generation of web-based interactive technology provides a unique platform for empowering both primary care providers and their patients with tools that facilitate familiar processes of care including patient compliance, patient education, benefit queries and self-management.

The Internet, like no other medium currently available, is expected to improve the quality of health care delivery by offering routine, provider-supervised patient reminders, evidence-based tools for tracking patient compliance with provider-directed therapeutic interventions, and techniques for monitoring patient outcomes that can guide the delivery of health care and measure its clinical efficacy.

Effective Rx interventions

Pharmaceutical interventions are at the heart of most managed care programs in the United States.

For example, in the case of asthma, corticosteroids are an effective pharmaceutical intervention in preventing the recurrence of asthma symptoms and avoidable use of the emergency room. There are effective and proven pharmaceutical interventions available for the treatment of many other chronic diseases including diabetes, congestive heart failure, Parkinson's disease, hypertension, arthritis and allergic conditions such as rhinitis.

For patients who are employed, the appropriate use of pharmaceuticals can reduce absenteeism and improve productivity. Since many of these medications are effective in lowering overall health costs along with improving health status, payors are as concerned with underprescribing by physicians as they are with overprescribing.

Once the provider has prescribed an effective medication, it is up to the patient to maintain compliance with the treatment plan, which in some cases means taking the medication for the remainder of his or her life. Studies have shown that on average, patients follow their doctors' advice to the letter only about half the time.

The leading reason patients fail to take their medication as prescribed is simple - they forget. But much noncompliance is intentional. Compliance is notoriously bad with patients, such as those with hypertension or high cholesterol, who have no symptoms and thus don't feel any better taking the drugs. In one study, Harvard Medical School researchers found that only 52% of patients prescribed lipid-lowering medications were still filling their prescriptions five years after the study began.

Empowering consumers

The paradigm shift in health care today is toward consumer empowerment, knowledge, education and value. Consumers are increasingly interested in - and some cases demanding a role in controlling their health. Recognizing that employers and employees have a shared interest in seeking the best possible quality of care at the most reasonable cost, employers welcome this trend.

A recent Towers Perrin survey asked large employers what they thought about health care "consumerism," defining it as increased individual responsibility, choice and decision making.

Both consumers and employers are looking to the Internet to play the lead role in consumer education and empowerment. While estimates of the number of people who seek health information online vary wildly - from about half of all Internet users to as many as three-quarters- there's no dispute that their numbers are growing rapidly. Consumers today are using the Internet to search for information regarding management of their disease, how best to maintain good health and the efficacy of various treatments.

Equally important, these consumers are using the information they find to help manage their health.

While it can be argued that consumers who look up health information online are predisposed to take a more active role, in many cases the information that patients find online leads them to ask their physicians more questions and in greater detail.

But self-education about health and wellness is only one aspect of emerging trend toward health care consumerism. Today's increasingly sophisticated consumers want to make sure they are choosing the best health plan and providers for their individual needs. While a growing number of health plans are going public with scorecards and other provider performance measures, too often consumers' efforts to make informed decisions have been stymied by a lack of easy access to clear and understandable information.

Research has shown that consumers typically do not use the information on report cards or they make decisions that are the opposite of what would be expected - choosing the lower quality health plan, for example.

According to a recent study by the Center for Health and Public Policy at the University of California, the disconnect appears to be that typical report cards overwhelm consumers with information they do not see as relevant. The average consumer does not understand how to use standard quality indicators such as the rates of pediatric asthma admissions or diabetic retinal exams. Moreover, consumers are skeptical of any information provided by a health plan or other source that they see as possibly biased.

Recognizing the weakness in existing provider ratings, DoctorQuality has developed a proprietary system designed to produce meaningful provider assessments that can easily be used by consumers of varying degrees of sophistication. The heart of the system is a patented algorithm that pulls information from state and administrative databases, clinical quality factors and consumer satisfaction measures and weighs each according to importance. In addition to providing an overall assessment, DoctorQuality provides information such as Board Certification, any sanctions against the provider's license, whether the provider offers evening hours and how other patients rank their level of satisfaction with the provider.

When this independent, third-party information is made available online, consumers have easy access to the information they need to make informed provider choices.

Consumerism goes one step further to educate patients about the standard of care they should expect from the health care delivery system and the kinds of questions they should ask providers. The goal is to help patients select the best provider for their particular needs and then to receive the highest possible quality of care. Again, this approach is consistent with recommendations in the Center for Health and Public Policy study.

By providing both extensive provider information and education about how to evaluate providers and the services received, customers can know what to expect from the health care system.

Health management programs are effective. The Internet offers an exciting potential for broadening the scope of targeted health interventions. Employers and managed care companies can realize savings through wise investments in effective health programs that reduce the incidence of avoidable health care utilization. The best estimates suggest that the return on investment associated with these health management programs can be as high as four dollars saved for every dollar invested in program costs.

There is little doubt that as the U.S. population ages, health care costs will continue to rise. Forward-thinking employer payors must seek creative solutions that not only protect future profitability and competitive advantage but also show an attractive return on investment in the near term.

Increasingly, these business leaders are turning to "next generation" health care service models. Based on a significant body of research, these models use e-health technology to expedite traditional managed care programs that have been shown to be effective in offline environments, including consumer empowerment, disease management, return on investment, lifestyle risk reduction, wellness and pharmaceutical interventions.

Because the next generation e-health service models are so new, the rigorous clinical studies necessary to validate their efficacy are only now getting underway. Nonetheless, the evidence to date suggests that by providing payors, patients and providers with actionable health information, the new e-health service models can yield improved outcomes and lower costs. -E.B.N.

Clelland Green is chief executive officer of America's Choice Healthplans.

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