vbbd webinar dec 2010
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Leveraging Value Based Benefit Design to Improve
Adherence and Lower Costs While Improving
Member HealthPart One
December 8, 2010
www.scioinspire.com
© 2010 SCIOinspire Corp.
| Presentation Agenda
• Introduction and Panelists
• Defining Value Based Benefit Design
• VBBD Overview
• Lessons from Early Adopters
• Interactive Question and Answers Session
SCIOinspire Corp Proprietary & confidential. Copyright 2010 3
Webinar, Panelists
Barbara Christensen is Chief Sales and Marketing Officer for Providence Health Plans, has more than 30 years of experience in the health insurance industry. Prior to joining Providence Health Plan, she was with Kaiser Permanente. Her current duties include management of statewide sales, marketing and product development for Providence Health Plan’s commercial, individual and Medicare programs.
Marcia Bondi is Director of New Product Implementation at Highmark Blue Cross Blue Shield in Pittsburgh. For the last two years, Marcia has spearheaded the design and implementation of Highmark’s forward-thinking Value-Based design program. In June 2010, Marcia was invited and presented Highmark’s approach to Value-Based design at the prestigious AHIP conference. Prior to joining the Product Development department, Marcia spent 16 years in Highmark’s Underwriting department and oversaw the group renewals and quotes of small, middle and large employers.
David Hom is an internationally-recognized expert in the field of Value-based Benefits and Employee Wellness. He joined SCIOinspire after more than 25 years with Pitney-Bowes Corporation, where he was responsible for introducing their leading-edge programs in value-based wellness, responsible for reducing medical trend to half of the industry average over a number of years.
Moderator
Bart Bracken is a healthcare executive with more than 20 years of experience in the healthcare and disability industries as a consultant and serving in senior leadership positions with large managed care organizations and specialty entrepreneurial companies. His broad experience includes managed care operations, strategic planning, marketing, business development, product development, and program management with both private and public sector programs. He has a Master in Industrial and Labor Relations from Cornell University and a BA, magna cum laude, in Economics from St. Lawrence University
SCIOinspire Corp Proprietary & confidential. Copyright 2010 4
Defining Value Based Benefit Design (VBBD)
“VBBD is using plan designs and incentives to drive member engagement for high value services which can improve adherence leading to improved health status and longer term medical savings. VBBD will also identify low value services and create the right disincentives to use those services which can be adjusted based on the clinical severity.”
David Hom (President, Care Management Services, SCIOinspire Corp.)
SCIOinspire Corp Proprietary & confidential. Copyright 2010 5
US Healthcare Market, Trends and Solutions
Data/AnalyticsDriven Transformation
Solutions
• Data Integration• Global Delivery• Consulting
Business Process/Cost Optimization
• Recover from third parties and other payers
• Reduce payment errors• Recover complex
overpayments
Payment IntegritySolutions
• Improve effectiveness of care programs and ROI
• Improve Product Design
Care Analytics and Reporting
• Leverage technology and media
• Better value-based benefit designs tie incentives with behavior change
Member EngagementSolutions
OPPORTUNITY TO TRANSFORM
Healthcare ReformMember & Provider Engagement
Care and Wellness Management Effectiveness
Payment Integrity Legacy Cost Structures
Health Insurer Trends
Solutions
SCIOinspire Corp Proprietary & confidential. Copyright 2010 6
Health Plan Adoption of Value Based Benefits
2007 2008 2009
• Smaller regional plans adopted for their own associates
• Began to productize for their book of business
• Regional Health plan adoption for their own associates
• Creating products for self insured and assessing for fully insured business
• National health plans began product introductions
• Products created for specific chronic conditions e.g., Diabetes
• Trizetto announces software enhancements integrating VBBD features with claims payment
Key Milestones in the Adoption of Value Based Benefits
2010+
Four Trends:• Linking incentives to
activities, outcomes in the future
• Evaluation Methodologies
• Aligning to supply side (P4P, Tiered network)
• Solution based sales• Greater supporting
research
SCIOinspire Corp Proprietary & confidential. Copyright 2010 7
Health Plan
Health Plan
Plan Design Challenges
VBBD compliance goals require more detailed Clinical and Financial Reporting
Limited scope of Plan Design Technology and Systems
Plan designs are focused on copayments rather than on engaging the member throughout the care continuum• Plan changes can result in
negative ROI• Designs need to align with
physician incentives• Designs should coordinate with
care management programs (e.g., Health coaching and Disease Management)
• Prioritization
Technology and Systems• Plan designs often differ at the
member level, posing problems for administrative systems geared to group-level administration
• Systems updates take time and resources
• VBBD needs to be integrated into all communications and outreach to the member
• Need to integrate VBBD compliance goals with providers and other professionals
| 8
MARCIA BONDI
Director, New Product Implementation
EARLY ADOPTER EXPERIENCE
BackgroundInternal Drivers of VBBDProduct PackagesKey Lessons and Conclusions
SCIOinspire Corp Proprietary & confidential. Copyright 2010 9
Background
Highmark has offered Value-Based since 2007
• Pitney-Bowes’ success prompted market entry
• Focused on prescription drug – 8 conditions
Offered Rewards program since 2007
• Employer funded rewards program focuses on all employees and rewards for engagement
• Packages: health risk assessment, lifestyle improvement, preventive, condition management and online tools
SCIOinspire Corp Proprietary & confidential. Copyright 2010 10
Internal Drivers of Value Based Benefit Design
Factor Trend
% of members with unhealthy behavior and conditions Increasing
Employee cost-sharing each year Increasing
Member Engagement Lacking
Program outcomes Lacking
Ability to payout cash rewards Not sustainable
Value Based Design
• Cost effective rewards for healthy behavior through benefit design or premium
contributions
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Value-Based Product – Packages
Informed Decision MakingHigher cost-sharing on low value services band not using Shared-Decision making
Reward for ResultsWorksite screenings
Risk AssessmentComplete Wellness Profile and Receive Preventive Care
Integrate Condition Management Protocol Compliance at
member levelFeature to focus on high-risk
Lower cost-sharing on high value medical services & prescription drug
Broad Population Targeted Patients
Encourage Engagement Reward for Outcomes
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Implementation Lessons
Key Lessons and Conclusions
1. Take time to design, build your product continuum and implement in phases
2. Ensure legacy systems are compatible
3. Establish evidence-based guidelines -takes time to define
4. Perform segmentation on your population to develop the right messaging
5. Ensure portal is friendly and engages, provides tools, is educational and provides benefit summary and status of protocols
1. Analyze data to determine what your population needs
2. Savings must be built into the price for mass acceptance
3. Target the right customers to steer them to the right products
4. Communications need to be robust throughout the year supporting various media types and engaging based on health personality
Key Conclusions
| 13
EARLY ADOPTER EXPERIENCEBackground and Internal DriversGoalsTiered StructureLessonsConclusions
BARBARA CHRISTENSEN
Chief Sales and Marketing Officer
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Drivers
Internal Driver: The Health Leadership Task Force
• Commissioned by the Portland business community in the summer 2008
• Goal: Develop solutions and actions to keep health care costs and premium
increases closer to the CPI
• Sponsors: Major health systems and health plans
• Build on Oregon Health Plan history of collaboration
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Value-Based Benefit Design Goals
1. Create a culture of health
2. Support, prevention, and health maintenance
3. Reduce financial barriers to the management of chronic care
4. Reduce the use of nationally-recognized (Wennberg/Fisher) care that, for
a population, is driven by provider-preference or supply rather than
medical evidence
5. Implement benefit design that encourages the most effective care with
more appropriate incentives
6. Achieve a 10% reduction in premium relative to a comparable open option
plan
7. Engage employers and employees in discussing plan design in a new way:
drives innovation for early adopters
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Design Features: Three Tiers
PREFERENCE/SUPPLY SENSITIVE SERVICES
THE “USUAL” STUFF
DESIGNED TO BETTER MANAGE CHRONICS
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Design Features: Tier 1 - Designed to better manage chronics
• No deductibles & zero or minimal co-pays
• Preventive health & wellness services
• Screening exams
• Routine immunizations
• Nutritional counseling
• Smoking deterrent medications
• Chronic care management (Depression,
CHF, CAD, Diabetes, COPD, Asthma)
• Generic Drugs
• Condition-specific labs/imaging/tests
• Primary care office visits
PREFERENCE/SUPPLY SENSITIVE SERVICES
THE “USUAL” STUFF
DESIGNED TO BETTER MANAGE CHRONICS
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Design Features: Tier 2 - The “usual” stuff
• Medical services subject to the standard
deductibles/co-insurance/out-of-pocket
maximums
• Inpatient services
• X-ray
• Lab
• Maternity services
• DME
• Outpatient surgery & services
• Home health
PREFERENCE/SUPPLY SENSITIVE SERVICES
THE “USUAL” STUFF
DESIGNED TO BETTER MANAGE CHRONICS
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• Preference/Supply sensitive treatments (18.4% all expenses)• Separate deductible
• Higher co-insurance
• Separate out-of-pocket maximum
• Preference/Supply sensitive treatments • Upper GI endoscopy X
• Nuclear cardiology
• Spine procedures for pain X
• Knee replacement X
• Knee Arthroscopy X
• Hip replacement X
• Shoulder surgery X
• Hysterectomy
• Emergency room Visits
• Coronary stents and angioplasty
• Coronary artery bypass surgery
• High tech imaging (CT, PET, MRI) X
Design Features: Tier 3 - Preference/Supply sensitive services
PREFERENCE/SUPPLY SENSITIVE SERVICES
THE “USUAL” STUFF
DESIGNED TO BETTER MANAGE CHRONICS
Our Customer: 6000 members
X = Additional Cost Tier
$500 co-pay in addition to
hospital & outpatient co-pays
Imaging $100
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Implementation Lessons
1. Preference sensitive is lousy consumer language: customer used “additional cost tier”
• For shelf product we have used “select value” and “value level 1,2,3”
2. Allow customer to pick among treatment categories but no exception on how the
category is defined by codes. No exception panel if someone really needs the
treatment in a category.
3. Claims payment depends on correct coding by providers
4. Decision tools important so consumer can learn treatment options
5. Health Risk Assessment useful in finding chronic care members early
6. We anticipate uptick in member appeals
7. Employer, member and provider education is key
8. Important to keep both tiers 1 and 3 to achieve price point
9. Important to keep nationally recognized list in tier 3
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Key Conclusions
• Decision tools important: provider usage/endorsement best
• Employers philosophically get it but prefer to not deal with noise and individual that
needs a treatment category
• Will not be mainstream soon
• Great innovation discussion
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Interactive Q&A Session
Please use the messenger on your screen to submit your questions
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Contact UsAnnie Welsch
Email: marketing@scioinspire.com
www.scioinspire.com
SCIOinspire Corp.
220 Farmington Ave, Suite 4
Farmington, CT 06032
Phone: 1.412.278.5800
Fax: 1.412.278.5810
© 2010 SCIOinspire Corp.
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