1. Balancing the PEPY/Noise Teeter Totter

2. Objectives
Identify the key considerations related to implementing cost- containment initiatives in your organization
Understand key strategies that mitigate dissatisfaction when implementing cost-containment strategies
Understand the correlation between cost-containment initiatives, timing, and employee satisfaction

6. The State of the Union…from a patient’s perspective
2015:
33% “unfavorable evaluations of seeking medical care”
12% “low perceived need” (4% “it’ll go away on it’s own”)
58% “traditional barriers”
24% high cost
8% no health insurance
16% no time
Now:
40% fear cost of treating a serious illness, only 33% fear becoming ill
44% skipped going to the doctor within the past year
40% skipped a medical test or treatment because of expense
50% skipped routine dental
40% skipped dentist despite symptoms
30% forced to chose between paying medical bill or food, heat, housing
33% skipped medication to save money
64% WANT TO LOWER THEIR MEDICAL BILLS BUT DON’T KNOW HOW!
First, over one-third of participants (33.3% of 1,369) reported unfavorable evaluations of seeking medical care, such as factors related to physicians, health care organizations, and affective concerns. Second, a subset of participants reported low perceived need to seek medical care (12.2%), often because they expected their illness or symptoms to improve over time (4.0%). Third, many participants reported traditional barriers to medical care (58.4%), such as high cost (24.1%), no health insurance (8.3%), and time constraints (15.6%).

7. TOTAL ALLOWED PEPY (Medical + RX)
Milliman Care Guideline 2016 National Average
$11,034
Relatively
broken
MCG Loosely Managed
$10,800
Moderately broken
$14,000
MCG Moderately Managed
$8,300
Total Allowed PEPY Calculation
Total allowed PEPY calculation incorporates the entire amount attributed to the health plan.
Because High Deductible Health Plans can impact the allowed amount significantly, the use is preferred over Total Paid PEPY.
Understanding MCG
Milliman Care Guidelines (MCG), is an industry standard set of evidence-based clinical guidelines.
According to MCG the national average for Total Allowed PEPY was $11,034 in 2016.
But remember, the healthcare system is broken so the MCG national average is a broken benchmark.
Turn attention towards best practice management of your health plan using MCG lose, moderate and well managed benchmarks.
A loosely managed delivery system (minimal preadmission certification, lax concurrent review, and hospital audits).
A moderately managed delivery system (uses some of the Milliman Care Guidelines® for inpatient care management standards, with moderate conformity to these standards).
A well-managed delivery system (conformity to the Care Guidelines inpatient care management standards).
About Milliman Care Guidelines Milliman Care Guidelines LLC, A Milliman Company, is located in Seattle, and independently develops and produces evidence-based clinical guidelines and software used by more than 1,800 clients, including more than 1,000 hospitals, and seven of the eight largest US health plans. Covering the continuum of care, the seven-product Care Guidelines series is updated annually by an experienced team of clinicians and is used to support the care management of a majority of Americans. For more information, visit
About Milliman Milliman is among the world's largest independent actuarial and consulting firms. Founded in Seattle in 1947 as Milliman & Robertson, the company currently has 54 offices in key locations worldwide. Milliman employs over 2,400 people. The firm has consulting practices in healthcare, employee benefits, property & casualty insurance, life insurance and financial services. Milliman serves the full spectrum of business, financial, government, union, education and nonprofit organizations. For further information, visit
Severely broken
MCG Well Managed
Client F - PEPY
$22,000
$17,000
$6,500

8. Noise

10. Fraud Waste and Abuse Institute for Health Improvement
Overuse of medical care
Administratively complex
Overtreatment
Pricing failure
Failure to use evidence-based medicine
Fake billing/Scams
crime/health-care-fraud/health-care-fraud-news
24 OIG US HHS lawsuits filed in June 2018 (8 so far in July 2018)
Health care is a $3 trillion dollar industry with 30 cents of every dollar gone due to waste and unaudited claims. Does your business incur 30% shrinkage? Whether you know it or not, you are in the health care business. Who is managing your health care supply chain? Did you know that $750 billion dollars could send every 17 & 18 year old to a state college? How many of your kids can we help pay for college today?

17. Healthcare Cost Containment Done the Right Way!
What does AIMM do?
Healthcare Cost Containment Done the Right Way!
Right Patient
Right Care
Right Time
Right Place
Right Price
5 RIGHTS of P3CM®