The push is on for a better way to gauge disease management's effectiveness. The push is on for a better way to gauge disease management's effectiveness.
By Bruce Shutan
Disease management has become one of the most promising, yet highly scrutinized, areas under the employee-benefits umbrella.
The number of employer sponsored disease-management programs rose to 58 percent last year from 41 percent the previous year, according to new research by Mercer Human Resources Consulting, which notes that disease management is often outsourced to a crowded field of more than 100 service providers.
However, the concept has also come under fire recently. Last fall, the Congressional Budget Office issued a report concluding that there's insufficient evidence that DM lowers overall health spending, citing as the chief culprit the dearth of broad population-based studies or clinical trials.
While acknowledging that disease management isn't a cost-cutting panacea, proponents argue that the CBO neglected to include recent studies showing clear cost benefits, such as the Thomson Medstat national survey of 26 health plans presented at the most recent annual meeting of the Disease Management Association of America. The study revealed that nearly half the respondents reported improved financial outcomes, with mean return-on-investments of 2 to 1 and 2.5 to 1 for diabetes and asthma programs, respectively.
Nevertheless, there's an organized movement afoot to deliver objective and credible measurement of DM program results that a group of industry insiders say is absent in the marketplace.
It comes at a time when employers are grappling with the consequences of a major demographic trend. With the nation's 76 million baby boomers expected to develop more chronic illnesses than their parents because of growing life expectancy, properly delivered DM programs may be just what the doctor ordered, says Les C. Meyer, a Denver-based health-care strategist who serves as chairman of the Disease Management Strategic Advisory Council.
Given the growing emphasis on benefits-cost containment, disease management will continue to be placed under the microscope for years to come until enough solid outcomes data is assembled to prove skeptics wrong.
The Institute for Health and Productivity Management and DMSAC recently teamed up with the newly formed Population Health Impact Institute to focus exclusively on employers and their return on investment in disease management.
Their collaborators include Fortune 500 companies, mid-sized firms and community providers. With the support of IHPM, PHII seeks to generate a higher standard of program measurement. Sean Sullivan, IHPM's co-founder, president and CEO, is on the lookout for "ultimate value" rooted in the ability of employers to realize valid and credible measurement of program results. He's confident that an economic benefit will be proven over time "for the simple reason that we know the so-called 'indirect' or 'workplace impact' cost of health problems are anywhere from two to three times as great as the direct health-care costs themselves."
One skeptic of the DM payoff to employers is Edward Wagner, an epidemiologist and director of the W.A. Sandy MacColl Institute for Healthcare Innovation in Seattle. "The evidence that better chronic-illness care saves money is scattered and, for most people, not very convincing," he says. Still, he believes it's worth noting that based on common sense, these costs over the long haul probably will be lower if employees are kept out of the hospital and brought back to work. "But what we need is better evidence," he adds.
Apples to Apples
Fueling confusion about the payoff from disease management is the fact that there are essentially two different approaches that have long been pursued. Under the most common scenario, Wagner says, patients manage their own condition with a nurse's supervision while doctors occasionally write a standard report. However, a more aggressive technique endorsed by his organization emphasizes scientifically-based treatment and ongoing patient support to improve both self-management and medical practices.
So what makes for an effective program? The answer may not be so cut and dried given these definitional challenges and varying criteria used by different organizations. For example, Meyer says although both the Disease Management Association of America and the American Heart Association follow evidence-based guidelines and embrace patient empowerment and greater physician involvement, there are some slight differences.
The AHA stresses scientific measurement, whereas the DMAA focuses on metrics involving process and outcomes. And while the AHA promotes the reduction or elimination in conflicts of interest, the DMSAC and PHII want better and more credible science as well as disclosure of interests. The group's governing body, IHPM, seeks to expand the view of DM outcomes to include the impact on workforce productivity.
"In an arena where medical and economic principles and competing financial interests all converge, credible information is vital to determining which DM program is the most effective and provides the best value," Meyer says.
That's why the PHII seeks to promote independent benchmarks of various clinical pathways for an apples-to-apples comparison so employers can determine which interventions work best. "If you can't measure it, you can't manage it," says Thomas W. Wilson, founder of the Loveland, Ohio-based group.
Wagner points to the U.S. Department of Veterans Affairs as a model for its commitment within the past decade to improving the quality of its chronic-illness care through greater attention to medical practices and patient support. "Across the whole VA system, they're doing better than the commercial sector," he says, noting the added difficulty of managing a low-income demographic.
At Pitney Bowes, the company's 10-year old DM program has shown clear results. For example, the Stamford, Conn.-based office-equipment and services provider's tab for diabetics and asthmatics fell, on average, 40 percent, while higher refill rates are credited with helping save slightly more than $2 million in 2003 -- a figure that Jack Mahoney, Pitney Bowes' corporate medical director, predicts will be matched or exceeded once last year's data are finalized midway through 2005.
Although the company saw a shift to more costly but convenient combination drugs, the tab for expensive asthma-rescue medicines was significantly lower, as reflected in emergency room visits falling 35 percent for diabetics and 20 percent for asthmatics, along with decreases in hospital admissions and physician visits, according to Mahoney.
The city of Asheville, N.C., is another early adopter of meaningful DM program techniques that date back to 1997, when diabetics who agreed to regularly meet with pharmacists and participate in education programs were given free drugs and medical devices. The project has since improved health outcomes for hundreds of participants across four chronic-illness categories and reduced annual medical costs by $1,622 to $3,356 per patient.
People in the know also praise efforts that unfolded long ago in Rocky Mount, N.C., where one of the nation's largest privately-held companies was able to dramatically decrease expenses related to premature births.
The sign of an effective program is one that involves "some very careful data analysis of your employee group" targeting chronic conditions that have the greatest impact on cost and outcomes, says Nanette Herbert, vice president of benefits and compensation at Boddie-Noell, which operates 350 Hardee's restaurants and also is involved in commercial and residential real-estate development.
The company launched its DM effort in the late 1980s, at a time when a significant number of premature newborn deliveries accounted for most of its high-dollar claims.
To counteract this disturbing trend, Boddie-Noell included as a covered service the hospital charges associated with newborn nursery care for expectant mothers who enrolled in a well-baby program. "Having an incentive has been a tremendous help to us in getting them to participate in the program," Herbert says, adding that making available clinically sound communication materials and resources designed to be understandable to the average person has been key to the program's success.
Now that the preemie issue is under control, Boddie-Noell has turned its attention in recent years to what Herbert labels "the big four" conditions within its employee population: diabetes, coronary artery disease, heart failure and chronic obstructive pulmonary disease. And it's no wonder, given an aging workforce whose average age is 40 and length of service eight years.
Pennies vs. Dollars
As the disease-management industry edges toward consensus on credible program measures and benchmarks, employers can stand to learn nearly as much about what to steer clear of when putting services out to bid as what to embrace.
Meyer can't help but utter the age-old cautionary phrase caveat emptor. "Employers need to avoid disease-management vendors that insist on evaluating their own services, with the value proposition in the left hand and answers to the test in the right hand," he says.
He recommends adopting the general code of evaluation ethics and principles that the PHII has articulated, or at the least, choose vendors that agree to an independent, third-party evaluation of their program.
One suggestion for improvement is to be more careful about matching methodology with the questions employers want answered. For example, Meyer says, it's important to factor in attrition when comparing results involving the same employee population from one year to the next.
He warns employers not to "try and save pennies while tripping over dollar bills in tightening up your benefits coverage on preventive measures."Meyer recommends that organizations cover all the medications and supplies for diabetes testing and anything that's needed for self-management of chronic illnesses.
Another potential problem is the coercive approach that penalizes people for failure to comply with drug regimens or other behavioral modification. For its part, Pitney Bowes prefers using carrots instead of sticks by making drugs more affordable for employees. The company reduced co-insurance to just 10 percent from much higher levels for diabetics and asthmaticswho filled their monthly pill supply or inhalers only nine times or less, which proved to be the single biggest and most costly risk factor.
"With disease management," Mahoney says, "what you're trying to do is educate the individuals and change their behavior through nutrition, exercise, treatment compliance and monitoring -- where appropriate -- things like blood pressure and getting people to agree it's worth their while to live differently."
May 2, 2005
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