Healthcare Truths Buyer Beware Peter Hayes May, 25, 2016 1 - - PowerPoint PPT Presentation

Healthcare Truths Buyer Beware

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Peter Hayes May, 25, 2016

Healthcare Landscape

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Healthcare Landscape

United States:

$3.2 Trillion 17.1% GDP $10,000 per capita

World (OECD median):

<11% GDP <$4,000 per capita

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Healthcare Landscape

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Healthcare Landscape

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Healthcare Landscape

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Healthcare Landscape

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Healthcare Landscape

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Healthcare Landscape

World Health Organization Ranking of the Worlds Health Systems

http://thepatientfactor.com/canadian-health-care-information/world- health-organizations-ranking-of-the-worlds-health-systems

#1 France #2 Italy #36 Costa Rica #37 United States #38 Slovenia

“We c can’t solve p problems by by using t the same kind o d of thinking w we used w when we created them.” – Albert Einstein

Starting Premise

Healthcare Landscape

Not About

• Discounts
• Admin Fees
• Premium Costs
• Health Promotion
• Disease Management
• Exchanges
• High Deductible Plans
• Obamacare

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Healthcare Landscape

About

• Patient Engagement
• Consumerism
• Patient Advocacy
• Patient Safety
• High Quality Cost Effective

Care

• Transparency
• Patient Decision Support

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Healthcare Landscape

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Healthcare Landscape Jaws of Doom

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Healthcare Landscape Jaws of Doom

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Source: Kaiser Family Foundation analysis of Truven Health Analytics MarketScan Commercial Claims and Encounters Database, 2004-2014; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, 2004-2014 (April to April).

Healthcare Landscape Jaws of Doom

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Healthcare Truths Buyer Beware

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The Good, Bad ,and Ugly

The Good

One can get exceptional care

The Bad

The majority do not

The Ugly

Medical errors kill 1,100 per day 50% defect rate 30% medical procedures unnecessary

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Healthcare Gap Analysis

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PERSPECTIVES GAP ANALYSIS

• Low Quality
• High Cost (inefficient)
• Perverse Incentives
• Access and Affordability
• Lack of a Culture of Health
• Little Accountability
• Sick Care System not a Health Care

System

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Perspectives Gap Analysis Quality-Report Card

• Healthgrades Rated 4500 Hospitals
• n Clinical Quality for 18 Procedures
• 262 Hospitals (5.6%) Awarded

Clinical Excellence

• Mortality Rate 30.9% Lower
• Would Save the Lives of 164,000

Medicare Patients

• States Ranged From 0% to 30% of

Hospitals being Clinically Excellent

Source: Healthcare IT News (1/16/13)

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Perspectives Gap Analysis Quality-Report Card

Dallas, Texas 46 Hospitals

43% 20 Hospitals with an A Safety Rating 30% 14 Hospitals with a B Safety Rating 27% 12 Hospitals with a C Safety rating

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Perspectives Quality

Economic Impact of Preventable Medical Errors Nearly $1 Trillion $3,000 per person

According to a study from researchers at Wolters Kluwer’s Journal of Health Care Finance, preventable medical errors may cost the U.S. economy up to $1 trillion in “lost human potential and contributions.” The study’s authors used Quality-Adjusted Life Years (QALYs) to develop, what they say, is a “more complete accounting of the economic impact when someone dies from a preventable error.”

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Hospital medical errors now the third leading cause of death in the U.S.

Medical errors leading to patient death are much higher than previously thought, and may be as high as 400,000 deaths a year, according to a new study in the Journal of Patient Safety.

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Perspectives Gap Analysis Transparency - Matters

• Rankings by Health Care Incentives

Improvement Institute and Catalyst for Payment Reform (2015 Report)

• 45 States get a F
• 2 States get a C (Vt. and Va.)
• 2 States get a B (Me. and Co.)
• 1 State gets an A (NH)

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Strategic Levers

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Health Care Waste

• $750 billion annually
• 30% of all procedures
• Common unnecessary services:
• Heart
• Prostate and breast cancer screenings*
• Imaging
• Back surgeries
• Knee procedures
• Antibiotics
• Preventable medical errors
• Preventable infections
• Unwarranted variation in quality and

cost * Article New York Times 2/11/14 “Vast Study Cast

Doubts on Value of Mammograms

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In healthcare, higher prices do not translate to higher quality

Higher Adherence to Quality Standards

50th %ile

Lower Cost

• Employees often

assume higher price points mean higher quality

• We consistently

find a 10-30% savings

• pportunity by

comparing paid claims to the median cost

• Savings does not

depend on utilization or change in plan design

Source: Regence Blue Shield of Washington (based on 41 MM claims data)

Cost variation by service – single health plan in one geography

Price variation in-netw ork

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EKG X-Ray of spine (3 images) Primary care (first visit, adult) Colonoscopy Service Price Range Price Variance

Min Max

$270 $162 $143 $3,967 $563 $27 $38 $85

7 x 3 x 4 x 5 x

Keys to Health Care

Right Care

50% is not 30% procedures are unnecessary

Right Place

40% difference in mortality between health facilities

Right Price

Prices for services can vary by 300%

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Could Diabetes Bankrupt the System

• 40% of current spend (direct

and indirect)

• 8% current population are

diabetic

• 20% are pre-diabetic
• 2% are compliant
• Pre-diabetic costs 32% more

($900/yr)

• Diabetic without complications

costs 64% more ($1,800)

• Diabetic with complications

costs 6x as much ($15,000)

• Diabetes Prevalence

Increased 45% last 20 years

Strategic Levers

• Quality and Pricing Transparency Tools
• Value Based Purchasing
• Providers of Excellence

Primary Care Specialists

• Centers of Excellence

Cancer Cardiac Joint Replacements Backs

• Patient Advocacy

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Portland Press Herald

Global Opportunities

FACE-LIFT

UNITED STATES: $10,500-$16,000 INDIA: $4,800 THAILAND: $5,000 SINGAPORE: $7,500 MALAYSIA: $6,400 Source: Portland Press Herald: March 2008

HIP REPLACEMENT

UNITED STATES: $33,000-57,000 INDIA: $10,200 THAILAND: $12,700 SINGAPORE: $12,000 MALAYSIA: $7,500

HEART BYPASS

UNITED STATES: $70,000 to $133,000 INDIA: $7,000 THAILAND: $22,000 SINGAPORE: $16,300 MALAYSIA: $12,000

Healthcare Landscape-Cost Drivers

Cost Driver Opportunity Proven Benefit Design Strategy Value Based Design Example Unnecessary Care $$$ Yes Providers of Excellence Preventable Medical Errors $$ Yes Providers of Excellence Unwarranted Price Variation $$ Yes Transparency Tools Patient Compliance $ Yes Incentives and Coaching Health Promotion $$ No Unproven

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Strategic Design Considerations

Plan Design Plan ROI

EE Impact

Savings

Preventative Care

• <1%

Health Promotion

• <1%

Eligibility Changes

• <1%

Disease Management

• <1%

CDHP/High Deductible $$ $$ <10% Tele- Medicine $$ $$ <10% Clinics $$ $$ <10%

Transparency Tools

$$$$ $$$$ >20%

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Employer’s Perspective Transparency

Why How Learning's

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Why Quality and Pricing Transparency

• Literally Can Save a Life
• Achieve Significantly Better

Health Outcomes

• Save Significant Health Care

Resources for the Patient and Plan Sponsor

• Will Transform Healthcare

Delivery

• Patients Will Demand It
• Patient Engagement and

Satisfaction Increase

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Why a 3rd Party Solution

• Employee’s do not Trust

Health Plans (still considered Managed Care)

• Employee’s do not Trust the

Employer (with Health Information)

• Medical Providers Do not

Trust the Health Plans or Employers

• Independence to Cut Across

Multiple Plans

• Think “Consumer Reports”

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Transparency Buyer Beware

Open the Hood Kick the Tires

• Huge Differences
• Consider Trustworthiness
• Consider Consumer Usefulness
• Consider Independence
• Patient Advocacy
• Consistency Across Plans
• Much More than a Medical ROI
• Credible and Proven ROI

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How To Do It

5 best practices for employee engagement

• 1. Maximize incentives: Design and promote creative, cost-effective incentives

through repeated communications

• 2. Leverage digital: Use a robust, multi-media digital promotion strategy
• 3. Develop a ground game: Use on-the-ground recruitment strategies and

advocates at all levels of your organization

• 4. Find the right messenger: Involve leadership and supporting employee

testimonials to build program credibility

• 5. Reach the family: Drive spouse engagement to address potential gender

gaps

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Consumer Engagement Holy Grail

Critical Ingredients:

Patient Advocacy Trusted Adviser Quality not Cost Leverage Smart Devices Include Human Touch Prospective Analytics Personalized Outreach One Stop Shopping

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Questions?

Quantum Leap: How Data Driven Transparency Elevates Your Benefits Game

Meredyth C. Brown Manager U.S. Wellbeing Programs

05/25/2016

Overview – Travelport

Leading Travel Commerce Platform

• Service $8 trillion global travel and

tourism industry

• B2B – connects travel providers with

travel agencies and buyers Travelport Medical Plan

• Self-insured
• PPO and HDHP plans offered

Employee Demographics

• 3,500 employees worldwide
• 1,500 eligible users in US
• 42% female | 58% male
• Average age: 51 years old
• Tech -savvy population

Business Drivers

Our key objectives:

2 1 3 Control rising costs of healthcare Provide a convenient decision support tool for employees to see costs and quality information Create awareness and engagement in all of our benefit programs

Our key criteria in selecting a benefit portal for employees:

• Wanted all of our benefits on a single platform
• Needed to be available through web, mobile and have a high touch (concierge)

component

• A personalized experience – real claims data, pricing, HSA balances, accumulators

Launched Castlight in Dec 2014

Employees understand there is a variance in costs – See their OOP costs Personalized - Past care claims, spending to date, HSA balances are all available Available 24/7 when and where employees need it (Doctors office, weekends, etc.) Promote it as a “Decision Support Tool”. Mobile, Web or Concierge Custom communication strategy – Focused on cost savings and convenience

Keys to our success in driving consumerism

Communications Has Been Key to Engagement

Results of Benefit Portal/Consumerism Strategy

Increase HDHP Participation

• From 9% to 60%

Great Engagement & User Feedback

• 49% Return users

Insights for Targeted Messaging

• Address ER usage spikes

Cost Control

• Below carrier book of business

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