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The Broker's Role in Making Healthcare Transparency Work
1. 360° Engagement
The Brokers Role in
Making Healthcare
Transparency Work
Confidential
2. The Problem
http://abcnews.go.com/WNT/video/healthcare-
cost-shock-23000-appendectomy-
16198878#.T5bd9USe8OQ.email
Confidential
3. The Problem
“The lack of transparency and
competitive pricing is responsible for
between $84B and $174B in wasteful
spending.”
Don Berwick, former head of CMS
“The lack of transparency costs
Americans $36B annually.”
Thomson Reuters, Transparency
Whitepaper, January, 2012
Confidential
4. The Problem
Transparency alone doesn’t work!
“Our view is that in their current form and
absent any financial incentives, publicly
reporting of cost measures is unlikely to lead
to the hoped for consumer response.”
Ateev Mehrotra, MD, MPH
University of Pittsburgh
School of Medicine RAND Health
Consumers' and Providers’ Responses to Public Cost Rreports, and
How to Raise the Likelihood of Achieving Desired Results, Abstract
Article, 2012. http://www.ncbi.nlm.nih.gov/pubmed/22459922
Confidential
5. But Transparency DOES work!
Serigraph – Paper based, rebate driven
Annual insurance premium increase <1/2 national
average over 7 years
No increase in 2012
Benefits plan consistently ranked as one of the “best
things about the company” in employee surveys
Manitowoc County (@ 400 employees) – Rebate
driven
15 users in first 6 months
45 users within 18 months
Documented 1st year savings >$180,000 (Bob
Confidential
Ziegelbauer, Co. Executive)
6. Why the Limited Success?
Selling discounts is easier than selling value
Confidential
7. Which Provider Has the Best Discount?
$4,500
$4,000
$3,500
$3,000
$2,500
$2,000 High
$1,500 Low
$1,000 Median
$500
$0
Confidential
8. Which Provider Has the Best Discount?
If You Don‟t
Know
Utilization, Disco
unts
Don‟t Matter!
If You Don‟t
Manage
Steerage, Discou
nts
Don‟t Matter!
Data for demonstration only
Confidential
9. Why the Limited Success?
Selling discounts is easier than selling value
Employees are not engaged in their healthcare
decisions
Consumers have had little incentive to shop for
care
Few good transparency tools are available
Changing behavior is difficult
Confidential
10. What’s Needed
Transparency is just part of the answer
1. Motivated client
2. Consumer oriented plan design
3. Simple tools
4. Customized to client
5. Integrated incentive programs
6. Ongoing communication program
7. Multiple employee contact points and options
8. Engaged and knowledgeable ASO
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11. Presentation Outline
I. Why Transparency Matters
II. Defining Transparency
III. Does Quality Information Matter?
IV. Rules of Engagement
V. Measuring Performance
VI. Selecting the Right Tool– The Good, The Bad
and The Ugly
VII. Why the ASO Matters
VIII. 360° Engagement – Role of the Broker
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12. Why Transparency Matters
Payors understand that cost
transparency is required to support free
market healthcare
Employers are shifting accountability
and responsibility toward the consumer
in the form of HDHPs
Confidential
14. Why Transparency Matters
The market is at an inflection point
for “funders” and consumers of
healthcare.
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15.
16. Plan Design Matters
HDHPs
Co-insurance
Out of pocket maximums
“Absent incentives… publishing cost
information is unlikely to change behavior.”
“Absent transparency… HDHPs are
unlikely to change behavior.”
Confidential
17. Defining Transparency
Allowed vs. Billed (retail) amounts
Includes technical (facility) and professional (MD)
components
Episode of care vs. the surgical procedure
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18. Cost Variability / Claim Variability
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Data for demonstration only
19. Defining Transparency
Allowed vs. Billed (retail) amounts
Includes technical (facility) and professional (MD)
components
Episode of care vs. the surgical procedure
Location level detail
Actual vs. projected
Actual location vs. Zip code
Chronic and acute conditions
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20. Quality
Consumer reports in health care: do they
make a difference?Schauffler HH, Mordavsky
JK.SourceCenter for Health and Public Policy
Studies, School of Public Health, University of
California, Berkeley, California 94720-7360, USA.
helenhs@uclink.berkeley.edu
“Quality „Reports‟ don‟t change
behavior”
Confidential
21. Quality
More expensive must be better!
Lack of Trust
Who defines quality?
Sources?
Important vs. unimportant measures
Hospital, Group or Provider level detail
Confidential
28. Rules of Engagement
C Suite Commitment
Communication Audit
Do employees have access to computers? The
internet?
Email culture? Mailbox culture? Water cooler
culture?
Intranet site?
Company newsletter?
How do you get people to give to the United Way?
Customization
Confidential
30. Rules of Engagement
C Suite Commitment
Communication Audit
Do employees have access to computers? The
internet?
Email culture? Mailbox culture? Water cooler
culture?
Intranet site?
Company newsletter?
How do you get people to give to the United Way?
Customization
Gamification
Confidential
32. Points Reporting
Set Date Rang
Monthly
Quarterly
Annually
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33. Easy to Administer
Export as
needed
Custom
Business Rules
for Points
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34. Rules of Engagement
C Suite Commitment
Communication Audit
Do employees have access to computers? The
internet?
Email culture? Mailbox culture? Water cooler
culture?
Intranet site?
Company newsletter?
Gamification
Rebates
Confidential
38. Rules of Engagement
C Suite Commitment
Communication Audit
Do employees have access to computers? The
internet?
Email culture? Mailbox culture? Water cooler
culture?
Intranet site?
Company newsletter?
Gamification
Rebates
Phone support
What to expect
Confidential
42. Measuring Performance
Setting Expectations
Discretionary vs. Non-discretionary decisions
What are you measuring?
How are you measuring it?
Does the transparency tool provide reports?
Communicating results
Confidential
43. Selecting the Right Tool
The Good
Use actual claim history
Incorporate plan design at employee level
Provide network level detail
Have integrated engagement tools
Linked to quality information
Multiple employee engagement options
Reporting tools to measure performance
Customized for the client
Knowledgeable ASO partner
Simple / intuitive
Confidential
44. Selecting the Right Tool
The Bad
Regional data
Procedures vs. Episodes
Ignores common ancillary costs
(path, lab, handling)
Requires clairvoyant users
Intimidating - TMI
Not linked to plan design or network
Subjective “ratings” with unknown metrics
Difficult to track / measure performance
Wait for information
Little quality information
Confidential
45. Selecting the Right Tool
The Ugly
Retail prices
Show only technical / facility component
Minimal or subjective quality information
Heavy reliance on user ratings
Suggests exact costs are known
Heavy reliance on user ratings
Require users personal information
Expensive
Too simple?
Confidential
46. Importance of the ASO
All healthcare is local
Client needs
Flexibility
Nurse advocates vs. $15 / hr staff
Do ASO objectives align with your clients?
Confidential
47. 360° Engagement
Role of the Broker
Identify the right client
Offer consumer oriented plan designs
Select a knowledgeable ASO
Choose the right transparency tool
Set expectations
Identify the right metrics
Support or provide a communication plan
Track and report performance
Confidential
48. The Result
Our partnership with Prairie States provides
unique combination of information, analytics and
incentives engages employees in their healthcare
decisions and supports consumer driven behavior
that results in cost savings.
Reduction in healthcare costs of 5% - 15%
Maximizes the value of the healthcare benefit
Engaged employees with better visibility to
healthcare cost drivers.
Immediate value to clients
Confidential
49. Thank You
Contact: Ross Bjella
414 469 9265
Confidential Ross@alithias.com
Hinweis der Redaktion
The need for healthcare transparency is in the news.In April of this year, the Archives of Internal Medicine published an article, “The Confusion of Hospital Pricing” by Roni Caryn Rabin. The cost of a routine appendectomy in California supposedly ranged from around $1500 to nearly $183,000. This story was featured on ABC News, which you can find at the link shown here.This story highlights some of the issues around transparency. Those of us that understand insurance claims know at least the $1500 amount is wrong – unless the patient had the procedure at home without anesthesia. But we can all agree there is a problem here.
Humana, Anthem and UHC have had a transparency tools available for the last few years. Are any of these companies promoting cost savings associated with these tools?
But in the right format, transparency DOES work!Serigraph working with AFG; Manitowoc Co. working with M3Why haven’t the brokers successfully replicated this success?
Let’s be honest – it’s easier to sell discounts than a program that requires actual behavior change.Here’s the problem:
Which provider is offering the best discount?3 years ago broker’s were comparing UHC’s 30% average discount to Anthem’s 28%. Today these average discounts are what? 38% – 42%? So this is why the cost of healthcare has dropped 10% over the last 3 years…
Here’s some Alithias client data looking at Colonoscopy episodes, with the prices ranging from around $1800 to $3700.Which provider offers the best discount?Most transparency tools don’t track utilization, but if you don’t know where the employees are going, how do you know they’re getting the best price?If you don’t try to manage steerage, discounts don’t matter!
Kaiser Foundation study: Some patients were “insulted” when asked if they should consider cost when making healthcare decisions.An employee was asked, “What is the biggest problem with consumer driven healthcare today; ignorance or apathy?” The employee answered, “I don’t know and I don’t care.”So why doesn’t transparency work? Because it’s only part of the answer.
If you are asked about transparency tools, or want to sell them, there are 8 “must haves” in order for the tools to be most effective.
Today’s presentation is really about the broker’s role in transparency – Why it matters, what quality means to transparency, how to get employees engaged, setting expectations and measuring performance, recommending the right tool for your client, and the importance of choosing the right ASO.
This is why everyone is talking about transparency today.
400% increase in HDHP plan participation
Employers are trying to bend the healthcare cost curve by putting more responsibility on the employee.
Typically seen in the form of HDHP’s, increased co-insurance, and increases in out of pocket maximums.We know from the Rand study that just showing costs won’t change behavior. But the corollary is that without transparency, HDHPs won’t change behavior. If an employer expects their HDHP to change employee behavior, they should couple it with a transparency solution. But not all solutions are the same.
The tools look at things differently.Some just show the technical component, others just the retail amounts.“If you aren’t controlling the diabetes, the cost of the amputation doesn’t matter.”
Here is an Alithias report that highlights the importance of considering an episode of care, i.e., all the potential associated claims – as opposed to just the actual procedural component. Again, looking at a Colonoscopy with Biopsy – 3 different episodes, ranging from $1400 - $3100. If the transparency tool doesn’t consider anesthesia, pathology, and labwork – the estimated cost won’t be accurate.
Some tools use projected data at the zip level, which often isn’t accurate enough to make a difference.I’ve had many conversations with Jerry Frye at BSG about which procedures to display and how to display them. “If you aren’t controlling the diabetes, the cost of the amputation doesn’t matter.” My argument is that the tool should show both the chronic and acute Tx costs, so we’re starting to work together to figure this out.
Just a few comments about quality information. A good transparency tool should have some quality information. The issue is that according to a UC Berkeley study, patients currently don’t use quality information to make healthcare decisions.
We happen to have a number of very good health systems in WI, so perhaps the quality differences aren’t sufficient to get people concerned. But what is “quality” anyway? Hospitals = Adherence to protocols | Patients = outcomes.Beware user generated content.When everything is important, nothing is important. I love my Dr – He is always testing me, checking on my weight and and asking me to stop smoking. He really cares.I hate my Dr. He is always testing me, asking me to lose weight and stop smoking.
Perhaps the most important factor in any transparency initiative is getting the C-suite behind the programYou may want to do a communication audit at the time of open enrollment to see what communication medium resonates with employees. We believe that 7 – 9 annual exposures are required to change behavior, so we have designed a communication plan with that number in mind“Everything should be designed to be as simple as possible, but no simpler.” EinsteinWhat to expect: Direct correlation between utilization and incentives. $50 sign up = 67% engagement. 3% after 6 months, 11% after 18 months (Manitowoc Co.) 5% - 25% engagement; 5% - 15% cost savings.
The ability to customize the tool will help engagement. On the Alithias site, HR administrators can create active or static announcements on the fly.
We have also added some “gamification” features to keep people interested.“Everything should be designed to be as simple as possible, but no simpler.” EinsteinWhat to expect: Direct correlation between utilization and incentives. $50 sign up = 67% engagement. 3% after 6 months, 11% after 18 months (Manitowoc Co.) 5% - 25% engagement; 5% - 15% cost savings.
HR administrators can easily track user points to help manage the program and support awards.
Example report summary
Rebates are another option.
Easy for administrators – just click on the “set rebates” tab
Then input the rebates at the locations they want, hit submit, and
Users see the rebates associated with the location on the site. If the rebate option is not taken, this column is hidden to users.
Interestingly, about 50% of our client’s employees either don’t have regular access to computers or the internet at home. As much as I’d like this to be an internet only tool, some people want to “talk to a human.” Prairie States can provide this option through the nurses in their 5 Star program.What to expect: Direct correlation between utilization and incentives. $50 sign up = 67% engagement. 21% after 18 months (Manitowoc Co.) 5% - 25% engagement; 5% - 15% cost savings.
So - this should save millions, right? No – but it’s a great start.
We have created a “what if” tool in our software that allows clients to look at a given procedure, view utilization, and then calculate the potential savings with steerage.
In this example, this client would have saved $29K if they were able to get 100% steerage to the Sheboygan Surgery Center OR just pay a flat amount of about $2600 for the procedure.
My point is that the broker should work with the client to set expectations. No one’s checking the website if they’re having a heart attack! But if you focus on communicating the potential savings for a few common procedures and have the reporting tools to track performance, you have a much better chance of a successful program.
There are a number of tools available, each with different features, so I will quickly share what to look for when choosing a transparency solution
Nearly any free service available on the internet
The ASO has an important role in any transparency solution. Primarily because they need to understand 3 things:The local healthcare and geographic market. When an employee calls for prior authorization, an engaged ASO will understand and empathize with patient needs.The ASO must understand the client needs and multiple plan designs and have the flexibility to accommodate client nuances.Prairie States has nurses answering the 5 Star phones to ensure that if a patient starts asking deeper questions, a correct answer is provided during the call. An educated advocate helps patients understand what they are going in for and may uncover information that could support a better patient outcome.Lastly, the ASO’s objectives should align with the employer.
So when discussing transparency with your clients, it’s important that you:
The Prairie States / Alithias partnership provides one of the best transparency solutions available, and you can feel confident offering this solution to your clients.
