Medical Home: Consumerism Delivered

By Lindsay Resnick, January 5, 2009

Consumer Directed Healthcare can be defined as health benefit plans that put consumers and their providers at the center of health care decision-making, giving them greater discretion and power over benefit dollars and medical care choices. These plans often include increased cost-sharing wrapped around an HSA, decision support tools to evaluate choices, “health coaches” to encourage care management, and incentives to promote healthy lifestyles. Rather than shielding consumers, CDH plans engage them directly.

CDH is based on “patient centeredness” which, as defined by the Institute of Medicine, refers to health care that establishes a partnership among practitioners, patients and their families to ensure that decisions respect patients’ wants, needs and preferences; and ensure they have access to education and support to make decisions and participate in their own care.

Consumer Directed Healthcare and patient centeredness has given rise to the next “hot trend” in healthcare - the medical home. A medical home is not a house, clinic or hospital, but rather an approach to providing comprehensive primary care. A medical home is defined as primary care that is accessible, continuous, comprehensive, family-centric, compassionate, and culturally effective.

A “whole person” orientation to healthcare delivery is at the core of the medical home. A personal physician is responsible for providing all the patient’s healthcare needs. Care is coordinated across all components of the patient’s healthcare community - hospitals, specialty physicians, pharmacists, social services, home health, nursing homes, and ancillary providers. And, it includes a vision of care for all stages of life, acute and chronic, wellness and prevention, and end-of-life. The medical home was introduced in 1967 by the American Academy of Pediatrics. Most recently, several professional medical organizations joined the AAP to redefine the basic tenets of the Patient Centered Medical Home:

Personal Relationship: Each patient has an ongoing relationship with a personal physician trained to provide first contact, continuous and comprehensive care.

Team Approach: The personal physician leads a team of individuals at the practice level who collectively take responsibility for the ongoing patient care.

Comprehensive: The personal physician is responsible for providing for all the patient’s health care needs at all stages of life or taking responsibility for appropriately arranging care with other qualified professionals.

Coordination: Care is coordinated and integrated across all domains of the health care system, facilitated by registries, information technology, and health information exchange to assure that patients get the indicated care when and where they want it.

Quality and Safety: This includes using electronic medical records and technology to provide decision-support for evidence-based treatments.

Expanded Access: Enhanced access to care available through systems such as open scheduling, expanded hours and new options for communication between patients and physicians.

Added Value: Payment that appropriately recognizes the added value provided to patients who have a Patient-Centered Medical Home.

The medical home is the next step toward true healthcare consumerism. With 45% of the U. S. population having a chronic medical condition accounting for $3 out of every $4 spent on healthcare, coordinated care delivery supported by a team-oriented medical management plan-of-action is a direction worth pursuing.


The Great Recession: as seen by Health Plan Executives

by Clive Riddle

There have been a number of depressions in the American economy since the days of Alexander Hamilton. We only refer to one as the “Great Depression,” and it seems joined at the hip with an entire decade (the 1930’s.) There have been a wide number and range of recessions in American history. It’s hard to know how today this one will fully play out, but it feels different. Perhaps we’ll move on from calling our current situation the “Current Financial Crisis” and we’ll end up calling this the “Great Recession.”

CSC yesterday released results from their November 2008 survey of 30 senior executives representing 26 health plans, with their report "Insuring the Future: Health Plans Respond to the Financial Crisis." Here’s what they found was going on in the minds of our health plan executives relating to whatever you want to call our economic mess; the following is a summary of the questions asked, survey results, and our comments:

  • “Compared to 2001 – 2002, how will the current economic downturn impact your organization?” 73% answered “Bigger Impact; 13% said “About the Same” and 13% answered “Smaller Impact”, “No Impact” or “No Opinion.” [so three-fourths might agree with calling this a Great Recession.]
  • “Which indicator does your organization use to predict and plan for the effects of overall economic changes?” 69% mentioned unemployment; 55% mentioned health care inflation; 31% mentioned investment performance and the answers tailed off from there [makes sense- employment drives membership, inflation drives the medical loss ration, and investment income is the difference between profit and a loss for many plans.]
  • “What is your organization’s response to the downturn?” 48% will implement cost-cutting projects; 41% will implement revenue enhancing projects; and14% will lay off staff. [Revenue enhancement is going to be a challenge in this economic climate if premium increases are what they have in mind. We would project a drastic reduction in negotiated premium increases, let alone benefit buy-downs that will reduce revenue.]
  • “How has the downturn affected demand for your products?” Regarding enrollment, 48% anticipate an increase in individual product enrollment vs. 10% projecting a decrease; while 45% predict a decrease in group sales compared to 7% projecting an increase [what are these 7% smoking, or maybe they just think their going to steal away competitors market share?]; and 69% project an increase in government program enrollment compared to 14% predicting a decrease. Relating to employer group renewals, 54% anticipate a decrease in small business renewals, and 31% project decreases in large group renewals [so the small group market will make significant cuts in providing coverage or eligibility, driving the individual and government program increases, and the group market will continue to diminish in size as it has this throughout this decade.]
  • Also regarding the demand for product type, 67% see an increase in demand for Consumer Driven plans compared to 5% anticipating a decrease, compared to 29% increase/24% decrease for PPOs and 43% increase/14% decrease for HMOs. [So consumer driven plans, which many pundits have seen as an endangered species with the new Democratic administration and congress may still have some legs due to the impact of this recession, and HMOs may make a comeback from the managed care backlash starting ten years ago, as a stronger tool to stabilize costs.]
  • “How will the economic downturn affect other business partners?” 73% anticipate cashflow/solvency problems with provider networks, and 54% predict network stability problems relating to access and availability. [As provider networks serve multiple plans, you can have a reverse supply chain problem compared to the auto industry. With autos, a collapse of the manufacturers can bring down the supply chain. Here a collapse of the provider network supply chain could wreak havoc with the health plans.]

Of course, how one sees the economic situation depends upon one’s personal stake and position at the time. The joke goes, a definition of a recession is when you lose your job. The definition of a depression is when I lose my job.


Personal Health Records: The Hot Consumerism Tool

By Lindsay Resnick

Consumer Directed Healthcare (CDH) is past the tipping point. Employers, employees, payers and providers have embraced these free market style health benefit plans that put consumers in the center of deciding where, when, and from whom they receive care---the customer now has more skin in the game. CDH success means changing the way people think about and deal with their healthcare choices. It takes practical decision support tools, credible information and increased connectivity throughout the healthcare system. Now, the newest consumer trend is allowing individuals and families to maintain their own online health records.
Personal Health Records (PHRs) enable consumers to have easy access to their health history and clinical make-up in order to manage benefit and medical decisions. It gives consumers more knowledge and control over their health information. In essence, it creates a smarter, better informed healthcare customer. PHRs allow an individual to enter and record personal medical information such as medical history, prescriptions, examination results, office visit tracking and, lab and diagnostic test results. Based on PHR functionality, consumers can input or scan images, charts, graphs, and print reports.
The result is a PHR that provides an accurate, up-to-date summary of a person’s health status and medical history. The information is secured online and only accessible by the individual or, medical professionals with approved authorization, at the PHR owner’s discretion. In addition to a standalone, consumer-driven PHR, other models are emerging that take a more integrated approach allowing information to be input through other, secure sources such as physicians, pharmacists, home care and even linked-in claims data.
In a predominately paper-driven medical record world, online PHRs bring the portability and connectivity that make reliable information available, quickly. The result can be lifesaving in emergency situations, help avoid harmful medication interactions, reduce unnecessary tests and properly prepare consumers with the context to ask the “right” questions. Most importantly, PHRs give consumers the control they need to make informed, confident decisions.
Internet-based Personal Health Records are rapidly emerging. In a State of the Union address, the President called for every American to have one in ten years. This year, Microsoft launched HealthVault and, Google Health is testing its own PHR. It is estimated that there are more than 200 PHR products available in the market with a wide range of functionality, level of integration and “cool” features.
With consumers well on the way to being the centerpiece in the future of healthcare benefit and medical decision-making, PHRs will continue to grow in popularity and acceptance. A recent Markle Foundation survey shows that almost 80% of the public believes PHRs would provide significant benefits to individuals in managing their health, although many (57%) express concern over privacy and security of their information. PHRs are here to stay. They represent another step in healthcare’s technological movement built around content, community, commerce and connectivity.


Easy Answers Make Poor Gifts

By Laurie Gelb

A new political era is upon us, and the red herrings that should be frolicking in the wild somehow never left the boardroom.

You’ve heard them all. Members are lazy slugs. Docs are mercenaries with stethoscopes. Pharmas suck the last dollar out of destitute Part D recipients. Often, the pharmacy chains come out best in this narrative – their low generic pricing is actually both market-driven and good for adherence. But improved outcomes are unlikely to be driven in large part by CVS or Walgreens in the current regulatory environment. So what’s next?

Recently, I’ve explored scores of managed care and health system Web sites as a strategist and competition judge. As I’ve pointed and clicked across this year’s domains of top-tier AMCs and health plans, I’ve reflected on my MCOL presentations of the last few years.

Many of us preach the need for customized decision support that validates the complexity and importance of stakeholder choices. Yet the health Web on evidence in 2008 continues to propagate the false dichotomies of idiot vs. expert, with information accessible through clunky largely static pages, with only the most rudimentary support for critical decisions like choosing a physician or evaluating the urgency [often confused with indications] for surgery.

If all you care about in selecting a doc is gender, languages spoken and hospital affiliations, you’re in the right place. If Flash first-reads displaying ethnically diverse docs and patients are your idea of immersive storyline, Google “hospital” or “health plan” and go to town. If your idea of a surgical consult on the Web is a pretty graphic and a few FAQs, welcome to the Net. But don’t we spend a lot of offline ink telling members that they need to ask much more probing questions?

Has Revolution Health and/or HealthGrades provided a quantum leap here? Hardly. Rate-a-doc portals? These probably eliminate some docs from consideration lists, but there’s scant evidence that they are helping distinguish the incompetent from the competent. The “rate a drug” racket probably does more for the raters than the readers.

Finally, hospital rankings and mortality stats, flawed in so many obvious ways, also divert attention from the notion of physician selection as a starting point, not to mention the idea of a medical home. Yes, the data quality is improving, but the support for the right ways to use it is not!

Instead of directly addressing patient and caregiver reasons for fear, loathing and denial of clinical realities (such as very few placebo-equivalent drugs or no-risk surgeries), content developers often seem to think that simply acknowledging the existence of these phenomena solves the problem. The proposition that “I’m OK, you’re OK, disease is OK” is in danger of replacing actual decision support in the health digisphere. With a President-elect who admits incomplete smoking cessation but exercises diligently, might we have a teachable moment here?

As for rational consideration of potential health decisions, the mass media’s tendency to discuss competing risks using anything but anecdotal evidence has increasingly obscured the differences between population-level statistics and individual considerations. And judging from the conflict-of-interest stories sprouting like mushrooms, no one at an academic medical center ever took money from pharma or device manufacturers till recently (NOT!) Another walk away from the real, toward the valley of oversimplification.
Disease is a real entity, with disability and death possibilities for everyone every day “We’re never promised tomorrow,” as Chief Daniels noted during one of his Polonius moments on Hill Street Blues. At the very least, addressing unpleasant facts so as to minimize risks entails the willingness to believe that decision-making can entail choosing among suboptimal choices. When members lose sight of the complexity, the effort, the costs of acquiring and acting on the best information, we’re only letting them kid themselves.

Baby talk is maybe talk. “Eat less simple sugar today! You can do it!” Passive voice is well, passive.
How honest, precise and strong are your communications?


The Future of Individual Plan Underwriting vs. Guaranteed Issue

By Clive Riddle

United Health Group betting on continued patchwork of State Regulations

An ongoing conundrum central to health coverage reform is the chicken and egg issues of health plan acceptance of individual health care coverage, mandates and guaranteed issue.

If all plans were required to accept all individual applicants for all policies (full guaranteed issue), the argument goes that significant adverse selection would occur, as only those uninsured with funds that could reliably project their actual health expenses would exceed the insurance premium costs would purchase coverage. In order to correct for this, it is argues that a mandate is required (requiring all of an applicable population to obtain/receive coverage.)

For example, the health plan industry, through America’s Health Insurance Plans (AHIP) have just proposed guaranteed issue in exchange for a mandate, stating in a press release: “Health plans propose guaranteed coverage for people with pre-existing medical conditions in conjunction with an enforceable individual coverage mandate. To help working families afford coverage, advanceable and refundable tax credits should be available, phasing out as income approaches 400 percent of the federal poverty line. Right now, in most states, individuals can be turned down by insurance plans when they apply for individual health plan coverage, if they do not satisfy the plan’s underwriting criteria. The only sure way for an individual to get coverage is to live in one of the few states with guaranteed issue, or obtain employment where group health plan coverage is offered.” (Refer to AHIP December 3rd, 2008 Press Release: Health Plans Offer Comprehensive Reform Proposal.)

But will a health care reform package include such a mandate that extends to the individual, non-group market, particularly in the current economic climate? The Obama reform proposal had focused on employer mandates.

In the current group environment, employees and dependents whose group coverage is ending can self-purchase continuing coverage to maintain their group policy benefits, at 102% of the cost of their group policy under provisions originally set forth under COBRA continuation of benefits regulations, but this coverage is generally limited from 18 to 36 months, depending on the circumstances (refer to for details on COBRA continuation of coverage provisions).

Also in the current environment, guaranteed issue for all individuals just in Maine, Massachusetts, New Jersey, New York and Vermont. Washington provides guaranteed issue for some classes of individuals, and of course many states have incremental provisions extending coverage provisions. (refer to Kaiser Family Foundation for a summary of Individual Market Guaranteed Issue.)

So the question is, assuming health care coverage reform isn’t so far-sweeping that the individual market is removed due to full universal non-group based coverage, will the future of individual health plan coverage involve:

A. Federal Guaranteed Issue With Some Type of Coverage Mandates
B. Federal Guaranteed Issue Without Mandates
C. Continued Patchwork of State Regulations

United Health Group is betting on the latter, and now selling the right to Guaranteed Issue to qualified prospects. They have announced in a December 4th press release and as reported in the New York Times (refer to the Times December 2nd, 2008 article, UnitedHealth to Insure the Right to Insurance ) that UnitedHealth has unveiled “a ‘first of its kind’ product: the right to buy an individual health policy at some point in the future even if you become sick. Called UnitedHealth Continuity, the product is not actual medical insurance, but is aimed at people who may have insurance now but are worried they may lose it — and may not be able to obtain replacement insurance on their own.”

United states that “with Continuity, consumers only need to go through the medical underwriting process once, at the time of application. Once they are approved, their coverage is guaranteed when they need it regardless of any medical conditions that may have developed in the meantime...With Continuity, consumers can choose from a wide range of health plans, deductibles and optional benefits including traditional health insurance plans, health savings account plans and lower-cost high deductible plans. Once the plan is approved and issued, the Continuity rider gives policyholders the option to leave the plan deactivated while covered by group insurance or activate the plan when they lose or voluntarily leave group health insurance coverage because of early retirement, job loss or simply because the employer no longer offers health benefits.”

The Times reports the cost for holding the Continuity Guarantee is 20% of a standard individual premium, and is subject to underwriting before the Guarantee is issued. On the surface, it is difficult to imagine a large market for United’s Continuity product at such a steep price, given that COBRA is available as an interim stopgap for those with group coverage. The Times quotes a broker who states “I think it’s got very, very limited application.”

However, United’s innovation does open the door to variations on this theme that could have more widespread appeal, if in fact, federal requirements for guaranteed issue do not materialize. Health Plan competition for group coverage could result in rider provisions for no-cost or low-cost individual coverage guarantees, as part of the group policy, so that the employer can advertise improved continuation of coverage or portability in the event employees lose their group eligibility for whatever reason. That type of product could have widespread interest in the group market.