Employee Wellness Committee – January 29, 2009 Lee Covella / Paul Hackleman / Bill Tugaw.

Employee Wellness Committee – January 29, 2009

Lee Covella / Paul Hackleman / Bill Tugaw

Objectives

• Understand Premium Composition

• Understand County-Specific Trends

• Focus on Design / Other Changes

• Identification of Potential Initiatives

Understand Premium Composition

Premium Rate Components

• Incurred Claims for Rating Period

• Trend / Health Care Inflation• Reinsurance (Unexpected / Catastrophic

Claims)

• Reserves – IBNR

– Pending / Unpaid Claims


• Capitation – Fixed flat amount paid to physicians in exchange for specific services / Typical of HMO Plans

• Credibility Factor – Percentage load applied for groups under 1,000 members

• Demographic Factor – Percentage adjustment for group specific demographics


• Premium Tax – 2% state tax applicable to fully insured plans

• Administrative Costs– Claims Administration– Customer Service– Marketing Materials / EOCs, etc– Utilization Review / Case Management– Vendor Profit– Broker Commission

Premium Components

• Trend Credibility Factor• Reinsurance Capitation• Reserves Demographic

Factor• Administrative Costs Premium Tax

• Incurred Claims

Premium Components you can and cannot control for future cost impact…..

County Health Trends

Health / CPI / Worker Wages - National

Prevalence by Condition (Major Diagnosis)

Prevalence and Cost by Condition

Major Conditions - Historical Overview

4.6%4.7%4.6%5.8%KP Regionally Adjusted Benchmark

5.6%5.6%5.5%7.2%San Mateo County

200720062005 **2004Prevalence



200720062005 **2004Prevalence

Diabetes



200720062005 **2004Prevalence



200720062005 **2004Prevalence

Asthma



200720062005 **2004CAD Prevalence



200720062005 **2004CAD Prevalence

CAD



200720062005 **2004Prevalence



200720062005 **2004Prevalence

Depression

Percent of Members Compared to Percent of Cost by Condition

17.0%55.6%All Other

6.3%2.1%Maternity without other conditions

6.1%9.5%Injuries (other than back pain)

3.8%4.0%Arthritis

4.2%4.6%Back pain

9.1%3.6%Cancer

13.7%3.3%Additional Chronic Conditions (any of 41)

26.2%15.0%1 major chronic conditions

13.6%2.2%2 or more major chronic conditions

COSTSMEMBERS

17.0%55.6%All Other

6.3%2.1%Maternity without other conditions

6.1%9.5%Injuries (other than back pain)

3.8%4.0%Arthritis

4.2%4.6%Back pain

9.1%3.6%Cancer

13.7%3.3%Additional Chronic Conditions (any of 41)

26.2%15.0%1 major chronic conditions

13.6%2.2%2 or more major chronic conditions

COSTSMEMBERS

Members Compared to Costs

• 21% of SMC Kaiser members have at least 1 chronic condition. This represents 54% of the total San Mateo County Kaiser cost.

Key Strategic Responses

Plan Design Options

• Change Plan Design/Benefit Policies• Implement Value Based Design Modifications• Modify Network Relationship• Change Financing • Improve Health / Reduce Risk

– Implement/Enhance Wellness Programs

– Member Education

Plan Design Options

Plan Design Options

Illustrative Plan Design Savings for ABC Group

Pct Value Estimatedof Plan Chg Dollar Savings*

$15 Office Visit Copay -1.13% (548,673)$ $20 Office Visit Copay -2.16% (1,048,791)$ $25 Office Visit Copay -3.03% (1,471,220)$

$100 Emergency Room Copay -0.22% (106,821)$

$100 In-patient Admit Fee -0.09% (43,700)$ $100 Out-patient Admit Fee -0.05% (24,278)$

$10/$15 Rx (100 day max) -1.39% (674,916)$ $10/$20 Rx (100 day max) -1.75% (849,715)$ $10/$20 Rx (30 day max) -2.93% (1,422,665)$ $10 $25 Rx (100 day max) -2.04% (990,525)$ $10/$25 Rx (30 day max) -3.30% (1,602,319)$

Elimination of $0 plan and migration of all to $10 plan -1.50% (727,841)$

-8.19% (3,976,179)$ Total Estimated Savings to current costs

Possible Plan Modification

Plan Design Options – Value Based

• Chronic Care Copays

• Surgical Centers for Outpatient Surgeries

Network Options

Network Options

• CalPERS Strategies– Select Physicians based on outcomes

– Aetna model in Washington state

• Discussion with Health Plans

Financing Options

Financing Options

• Self Funding – Self Funded Until 1994• Minimum Premium – Pursued in 2001• Pre-Funding – Pursued in 2001• Bonds – Pursued in 2001

Chronic Chronic Disease Management Disease Management

StrategiesStrategies

Care for Diabetes Checklist

Support and co-manage high risk diabetes patients with care/case

managers.

Assure patients with diabetes have their cholesterol monitored

because they are at risk for heart disease.

Assure patients receive regular eye exams to delay or prevent

loss of vision.

Provide opportunities for plan participants to learn about

diabetes in health education classes

Assure patients are taught self-management skills to care for the

condition.

Care for Depression Checklist

Consider providing a program through a diagnosis either by their

primary care physician or behavioral health specialist.

Because primary care physicians are often the first point of contact and

in a position to spot symptoms, consider developing several tools, such

as pocket reference guides and clinician education programs, to assist in

diagnosis.

Track medication use to ensure that patients are maintaining treatment

plans.

Work with network clinicians to provide training in “rapid cycle

change” methodology to support providers in testing innovative ways of

caring for patients with depression as a co-morbidity

Provide publications to help patients understand depression and its

treatment options.

Cardiovascular Disease Checklist

Assure patients enter a care program based on their use of certain

medications or clinic or hospital visits for heart disease?

Assure patients are on medications for lowering cholesterol and

reducing heart rate and blood pressure.

Provide lifestyle coaching about exercise, weight control, and

smoking cessation.

Asthma Checklist

Assure patients enter a care program based on an office, ER, or hospital visit, which results in an asthma diagnosis or their use of asthma-specific medications.

Minimize patients relying on rescue medications.

Provide self-management plans to teach patients to control their asthma, enabling them to be more productive and have a better quality of life.

Modify lifestyle to obtain weight loss for moderately obese members and smoking cessation.

Disease Management – Conclusion

Identify early at-risk patient through network provider tools.

Streamline electronic sharing of best practices among network

provider physicians nationwide.

Provide culturally appropriate materials in multiple languages

make services accessible to diverse populations.

The approach to treating patients with multiple chronic conditions

should be built into the integrated care.

Increased work productivity leads to better health outcomes,

leading to fewer sick days and greater productivity.

Working together in a collaborative effort is the best way to

leverage the provider(s), employees, retirees, and employer resources

to improve the health of employees / retirees.

SMUD – Reduction of Number of Risks

In Closing……….

Claims can be reduced by:• Disease Management for Chronic Conditions• Early Identification of At-Risk Members• Value Based Plan Designs• Focus on Prevention• Member Education/Member Awareness• Lifestyle Modification Support• More Efficient use of Services• Improved Member Health

Long term savings can best be achieved through a reduction in claims.

Next StepsNext Steps

Employee Wellness Committee – January 29, 2009 Lee Covella / Paul Hackleman / Bill Tugaw.

Documents

Transcript of Employee Wellness Committee – January 29, 2009 Lee Covella / Paul Hackleman / Bill Tugaw.