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Vol 34 No 1
| Date: January, 2014
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It's the NEW YEAR, and we are facing any number of challenges at the beginning of a year with structural changes to the core principles of health care delivery. At year end, we always hope that things will slow down a little bit, but that did not ever really happen with the Affordable Care Act morphing almost weekly from one challenge to another.
Besides the issues with health care, we are all dealing with climate issues. I have no idea where you are located, but here in Michigan we have been "blessed" with an early, hard winter. I've already shoveled the driveway three times - thank goodness the snowblower is now ready to rock and roll! At our building, we have already had to discuss service levels with our plowing contractor since peak loading hampers his ability to service all of his customers. I have to keep reminding him that the service he is providing is defined by whether the parking lot is clear. Today, New York has a thousand snow plows at the ready for a post-New Year's storm.
These little snow tidbits are a segue to the ultimate peak loading issues concerning on-site clinics and workplace wellness. I wish I had discussed snow removal and my place in the queue long before I called my provider to complain. In your own situation, if you are happy with the services and support you are getting, the time may be right to begin the important dialogue about contract continuation well before you hit any kind of peak loading situation - things change, vendors change, and coverage realities change.
One measure of these change forces seems to be the news media which is conspiring against bloggers. As I review professional journals, and Web sites, it's as though a blizzard of data and information have suddenly appeared. It's good data and good information, and much of it is very worthwhile to consider. I hope that some of this information resonates.
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The Issue of Pharmacy - Yet Again
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Pharmacy costs have traditionally been one of those areas where employers have long known "there's gold in them there hills." Right? You knew that by reviewing the data, you could find ways to save and still provide great prescription coverage for your employees.
Well, now hospitals have learned the same thing - not for their employees, but for their patients. A recent brief article in Hospitals & Healthcare Networks (December, 2013 issue) reported on the results of the efforts of a multi-hospital system in the Quad cities (UnityPoint Healthy-Trinity) in changing medication order patterns. The system "saved $1.9 million - nearly 14 percent of its pharmacy budget" in 2012. How, you ask? By doing what you are already doing for your staff - evaluating the data, working with physicians, using the professional literature, and standardizing care.
The staff member at UnityPoint responsible for the project, Cinda Bates, was quoted as saying, "This is not something you enter into on a part-time basis." No kidding. The dollars at risk are staggering; part-time focus just won't cut it.
All that being said, however, the system reduced spending by using equally effective, but less costly drugs in oncology (huge cost component everywhere, right?) and different processes in handling and disposing of medications.
This might make you want to go back and take a second look, but I suspect that those of you who take pharmacy-spend seriously, don't need a second round because you never ended the first one. It is a continuous process.
So what does this have to do with employers besides making you feel good about what you have already accomplished in this area? Well, read on.
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Narrow Networks - Including Hospital Contracting
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For whatever reason(s), narrow network development up to this point in time has focused primarily on outpatient services - contracting with specific physicians, physician groups, imaging facilities, labs, etc. But it's time to break the mold (at least we think it is) and take a serious, hard look at the hospital side of expenses.
It may prove difficult - hospitals aren't known for being very open to negotiating with anyone, let alone an employer. But with the ACA, the CMS Web site ( Hospital Compare), and the push for pay for performance, quality incentives, and transparency in cost, we think the time has come to sit down with the hospitals most utilized by your employees and sharpen the pencils. It isn't like it hasn't been done. Note the article on Becker's Hospital Review recently citing Anthem Health Plan's (a relatively small insurer, in fact) disengagement with 7 of the 38 hospitals in its insurance network in Maine. Why? Because they were able to negotiate contracts which will result in lower costs to Anthem (and they say a 12% reduction in premium expense to enrollees).
There is great controversy over this move by Anthem, and the article covers it all. But our takeaway is that if Anthem can do it, why can't you (if you aren't already)? Just to be fair to all sides, there is a very recent case in Connecticut in which the UnitedHealthcare Medicare Advantage Network was challenged successfully (for now!) by doctors who were excluded from their Medicare Advantage panels. This action bears watching as it may have implications for "value based networks" across the country. It is being appealed as we go to press. Our view has always been that self-funded employers will be the ones to solve the health care crisis and manage populations defined by their own employees and beneficiaries. Since CMS and all the large insurers are offering quality incentives to hospitals and the data on performance is becoming more readily available, this is an opportunity too good not to get in on.
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More Reasons to Focus on Hospital Costs
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Believe it or not (and we have been skeptical), hospitals are finally waking up and figuring out that their job is not all about length of stay! Until recently, hospitals (because of reimbursement mechanisms) focused much more on "get 'em in and get 'em out" than on quality, cost containment, and overall population health.
Again, with the ACA and changing reimbursement models, that focus is changing for the better. So this is yet another reason for you to get to know the hospitals your employees are using better. What programs are they offering that are unique? What does the data reflect on important issues like cost/case for your highest diagnoses? What is their readmission and complication rate?
Some unique things are happening, the winds are changing, and we found just a couple of them in an article in Modern Healthcare (November 25, 2013 issue, "Providers employ strategic interventions with hopes of getting the chronically ill to make healthier lifestyle choices"). The title alone caught us - getting people to change behaviors affecting health? There isn't an employer with an onsite clinic who isn't working on this issue every single day and struggling with it. Why not refer your employees to hospitals who share your concerns and are working on that issue, too?
An example of what is happening (and this is the tip of the iceberg): Carolinas Medical Center in Lincolnton, NC has started a program which follows the patient from the E.R., through the inpatient stay, and after discharge with sort of a full-service cadre of caregivers, social workers, pharmacists, and nurses. And they don't do this in a haphazard or random way - it is a focused, daily, comprehensive plan to help patients change.
The program has had its ups and downs, but since 2012 when they started this new program, the 30-day readmission rate went from 17% to 10.1% as of May, 2013. Dramatic! Think of the improvement in health, think of the increase in activity levels, and think of the quality of life issues.
The article goes on to discuss incentives, research into "behavioral economics" (what works and what doesn't, as an incentive for people in general), and the use of various incentives by large insurers (including UnitedHealth Group, the largest insurer in the U.S.).
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Some Data
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Some random data - just for you to think about as you drink that hot cocoa and watch the fire.
The Robert Wood Johnson Foundation did a study which showed that only 13% of E.R. physicians report washing their hands being treating a patient.
Pertussis cases in the U.S. are on the rise - there were 48,227 cases in 2012 (per the CDC), which is the highest number in more than 50 years (Vaccinate, Vaccinate, Vaccinate!).
Estimated savings in the healthcare system from retail clinic visits = $2.2B (10% of all primary care visits) and an additional $810M if nurse practitioners were allowed to practice independently in all states. Health Affairs, November 2013 issue.For more random data, go to our Web site, www.onsiteclinics.org.
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| ESCAPE FIRE - Emphasizing the issues | |
If you have not seen the documentary ESCAPE FIRE, now is the time to take a look. The subtitle is "The Fight to Rescue American Healthcare." Frankly, I thought that everyone had seen it, and I shared that impression in a recent interview. However, the reporter and some of the readership just had not been exposed to this great little documentary. No spoilers here - you know from the title tag line what it is about. The term "escape fire" is a reference to a radical and incongruous, self-preservation technique that wilderness fire fighters use when facing imminent danger from a raging inferno.
The reason that I share this with readers of this column is to give you a tool that you can use as an intro to what we are all trying to do -deliver traditional health care using nontraditional and even disruptive means. Take a look at the four-minute teaser and see if you think that this might be something that you can use for your presentations. Definitely, make a New Year's Resolution to watch the whole presentation! |
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For assistance with your on-site clinic questions and support, we list a variety of resources on that site, and we welcome your suggestions.
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The newsletter started out with me whining about snow and cold weather. Take some time to network in warmer climes this winter. There are some great offerings that we have listed on on our sidebar. I don't reference these because they advertise - they don't. A couple of them list our Web site as a "media partner," and I thank them for that, but we would list them anyway since they all have something to offer. We have listed a couple that are traditional "on-site" programs and some new ones that complement the "on-site" experience.
If you want to get a broad view of employee benefits, try the HBCE and if you want to immerse yourself in what consumers (your employees and their families) are seeking, give the IHC Forum a try. Sometimes it is interesting to get into a zone where people are dealing with general health care themes to make sure that you have perspective on your own focused discipline. Networking is the most important part of learning. Join the NAWHC and make networking part of your process of continued discovery and development. Network in the sun and in warmer climates to restore your sanity and Vitamin D.
Sincerely,
Mike La Penna
The La Penna Group, Inc.
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