The 2004 Healthcare Conference April 2004, Scarman House, University of Warwick David Mirkin & Joanne Alder

DISEASE MANAGEMENT  What is a DM program?  Why do we need DM?  Clinical Measures of Success  Actuarial Issues in Measurement  Does a DM program save money?

DMAA Definition of DM  Disease Management is a system of coordinated health care interventions and communications for populations with conditions in which patient self-care efforts are significant. Disease management:  supports the physician or practitioner/patient relationship and plan of care  emphasizes prevention of exacerbations and complications utilizing evidence-based practice guide lines and patient empowerment strategies  evaluates clinical, humanistic and economic outcomes on an ongoing basis with the goal of improving overall health.

DMAA Definition of DM :  Disease Management Components include:  Population Identification processes  Evidence-based practice guidelines  Collaborative practice models to include physician and support- service providers  Patient self-management education (may include primary prevention, behavior modification programs, and compliance/surveillance)  Process and outcomes measurement, evaluation, and management  Routine reporting/feedback loop (may include communication with patient, physician, health plan and ancillary providers, and practice profiling)

Critical to DM Success  Best Practice: Making sure physicians know and use the latest treatment approaches. (evidence based best practice guidelines)  Compliance: Teaching patients about the disease and how to self-manage  Utilization: Monitoring care for appropriateness.  Outcomes: Data analysis and feedback to providers and patients

Types of DM Programs  “Silo” or Disease Specific Programs  Diabetes  CHF  Coronary Artery Disease  Asthma  COPD  Integrated DM Programs (Patients with 2 or more chronic diseases)

DM Goals  Short Term Goals and Interventions  Identify and enroll patients with the disease.  Assess patients risk level and assign to risk category.  Improve treatment regimens.  Reduce related hospitalizations, emergency room visits and ancillary services.  Increase required outpatient screening visits and tests.  Monitor pertinent clinical data.  Improve therapy adherence.  Increase patient satisfaction

DM Goals  Outcomes: Long Term Goals and Measurements of Effect  Improve/maintain optimal health.  Evidence of therapy adherence.  Improved clinical status as measured by disease specific clinical indicators.  Reduced utilization of hospitalization, emergency room.  Reduced specific disease related complications.  Patient satisfaction.  Physician compliance.

Why Disease Management?  A Common Lay Question & Perception  “Why do we need disease management programs? I thought that we paid doctors to manage the patients. Why do we need to pay extra money to do what the doctors are being paid to do”

Why Disease Management?  Outcomes which are possible (evidence based literature supports) are not being achieved for the population at risk  Clinical  Functional  Financial

The Bottom Line Premium Worker’s Earnings General Inflation KFF/HRET, 9/2003

Population Outcome Failure  Evidence based best practice not applied  Large Variances in practices nationwide  Poor patient compliance  Lack of knowledge of disease  Not empowered  Lack of self management  Fragmentation of Care  Lack and Fragmentation of Resources  Lack of system integration

From Silos To Quality Care Payers Consumers/ Patients Hospitals Providers Employers Healthcare System DM Integration

Do You Need To Have Programs For All Diseases?  The rule still holds:  80% of the health care costs tend to come from 20% of the patients, therefore that’s where the attention should focus.

Chronic Disease United States 2000  US Population Year 2000 – 276 million  151 million (55%) are well or have acute illnesses  125 million (45%) have chronic conditions  125 Million With Chronic Illness  70 million (56%) have 1 chronic Condition  55 million (44%) have 2 or more chronic conditions

Future Cost of Chronic Disease  By 2030, 148 million Americans will have a chronic disease and their health bill will reach $798 Billion.

DM Program Outcomes Metrics  Clinical/Functional ROI  Decreased Morbidity  Decreased Mortality  Improved Quality of Life  Financial ROI  Cost Minimization  Cost Benefit  Cost Effectiveness

CLINICAL OUTCOME METRICS FOR DIABETES METRIC METRIC DEFINITION Foot examination % of members with diabetes who completed one foot examination using Semmes-Weinstein monofilament, palpation of pulses and visual examination in the measurement year. ACE inhibitors/ARBs % of diabetes members with microalbuminuria or clinical albuminuria (ADA Guidelines) taking ACE inhibitors or ARB. A1C level at target % of diabetes members with an A1C level <7.0% in the past year. (ADA Guideline) LDL level at target Percentage of diabetes members with LDL levels < 100 mg/dL within the past two measurement years. (use last measure to report) (ATP III Guideline)

CLINICAL OUTCOME METRICS FOR DIABETES METRIC METRIC DEFINITION Fasting lipid panel % of members with diabetes who completed one test in the measurement year LDL level* % of diabetes members with LDL < 130 mg/dL within the past two measurement years. (use last measure to report) ASA % of diabetes members >30 years of age taking an aspirin each day. Smoking quit rate % of diabetes members who reported smoking at the beginning of the measurement period who at the time of measurement had quit smoking

Diabetes Disease Management Outcomes  DCCT/NIH Trials  Retinopathy ↓ 35% - 74%  Severe non-proliferative retinopathy and laser therapy ↓ 45%  1 st appearance any retinopathy ↓ 27%  Development Microalbuminuria ↓ 35%  Development Neuropathy ↓ 60%

Congestive Heart Failure: Outcomes  University of Pennsylvania Health Systems- Hospitalization rates dropped dramatically from 532/1,000 patients to 19/1,000 patients.

Ischemic Heart Disease Outcomes - Statin Treatment Reduces CHD Events and Deaths Milliman Actuarial Models, Framingham Risk Scoring, NHANES III, ATP III

Actuarial Issues in the Financial Measurement of Disease Management Programs  Return on Investment  Regression to the Mean  Statistical Credibility  Trend Estimation  Operational & Other Issues

Measurement of Total Program Savings  Method One: Comparison of pre-enrollment medical expenses (baseline year) to post enrollment expenses (intervention year).  Method Two: Comparison of medical expenses for a control group to an intervention group for like period.  Method Three: Comparison of requested services to approved services or other detailed comparisons

Actuarial Considerations in the Measurement of Total Program Savings  Regression to the Mean  Statistical Credibility  Others 1. Depends on method used 2. Population management issues 3. Operational issues

Other Considerations for Measurement of Program Savings  Method One: Pre-enrollment expenses to post enrollment expense comparison 1. Utilisation and cost trend estimation 2. IBNR and claims runoff issues  Method Two: Control group versus intervention group expense comparison 1. Age/sex4. Underwriting 2. Benefit design5. Others 3. Industry

Modified Exponential Modeling for AMI Admissions

Modified Exponential Modeling for Bypass Surgery (CABG)

Table 3 Comparison of One Year, Three Year, and Modeled Ultimate Rates of Utilization

Why Should We Talk About ‘Statistical Credibility’?  Disease populations are often small percentages of the total population  Disease population is high cost, high variance  Often savings calculations are based on only a portion of the health care dollar for the diseased members  Savings guarantees and ROI target calculations need to reflect program impact rather than statistical fluctuation  An ignorance of credibility can lead to faulty or misleading conclusions

Typical Disease Prevalence Rates for a US Commercial Population (Employer Insured Active Employees) Diabetes3.8% - 8.1% Asthma1.6% - 5.1% CAD1.9% - 2.6% CHF0.3% - 1.1% COPD0.3% - 1.2% Source: Disease Management News, September 25, 2002

Typical PMPM Claim Costs Ranges by Disease Category for a Commercial Population (US $$$) Diabetes $400 - $800 Asthma $150 - $500 CAD $400 - $1,300 CHF$1,500 - $2,100 COPD $500 - $1,400 Source: Disease Management News, September 25, 2002

The Choice