© 1 Chronic Disease Management Megatrends August 2007 Vince Kuraitis JD, MBA Better Health...

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Chronic Disease Management Megatrends

August 2007

Vince Kuraitis JD, MBA

Better Health Technologies, LLCwww.e-CareManagement.com blog (208) 395-1197

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9 Chronic Disease Management Megatrends

MAGNITUDE: We are just scratching the surface of chronic disease challenges.

INTEGRATION: The 50 year tide is shifting toward integration, away from specialization.

MEDICARE: Medicare has endorsed the need for chronic disease management, but don’t assume that Medicare Health Support (MHS) is the final answer.

PROVIDERS: Care providers are waking up to DM opportunities and threats.

MAKE, ASSEMBLE, BUY? Fewer are buying as health management becomes increasingly strategic.

TECHNOLOGY: DM in your home and your pocket. BEHAVIOR CHANGE: DM is moving from a medical to a

social model; behavior change has become the Holy Grail. CLINICAL AND ECONOMIC ROI: Round one is over, DM

wins; Round 2 has just begun. WILDCARDS!

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MAGNITUDE: We are just scratching the surface of

chronic disease challenges.

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The Big Picture

Partnership for SolutionsPartnership for Solutions

Changing NeedsChanging Needs

1900-1950 Infectious Diseases

1950-2000 Episodic Care

2000-2050 Chronic Care

The $30 Billion Potential DM Market is Barely Penetrated

Disease Management Market Penetration(millions)

$0$5,000

$10,000$15,000$20,000$25,000$30,000$35,000$40,000

Available Market Industry Revenues

Medicaid Market Opens with FL

Healthplans and Self Funded Employers

FEHBP Plans Start Adding DM

CCIP Phase 1

CCIP Expansion

Source: Chris Selecky, President of DMAA and Chair, Lifemasters, 2005

Available Market based on Wachovia Capital Markets Formula

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INTEGRATION: The 50 year tide is shifting toward integration, away from

specialization.

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To Date DM Clinical/Business Models Have Emphasized Specialization

• Specialized companies providing services• Specialized contracting/financing model -- guaranteed savings• Specialized focus on individual diseases (migrating toward

multiple comorbid conditions)• Specialized technologies: predictive modeling, call centers,

medical management workflow software, etc.• Specialized delivery models are developing for unique customers

– Managed Care Organizations• HMOs• PPOs• other

– Medicaid (in various flavors)

– Medicare

– Employers

– Special Needs Plans– Specialty pharma– State high-risk pools– Multiple diseases– Comorbid patients– Highest cost/risk patients– etc., etc.

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The Tide is Shifting:Value Creation Opportunities in Integration

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MEDICARE: Medicare has endorsed the need for chronic

disease management, but don’t assume that Medicare Health

Support (MHS) is the final answer.

The Event-of-the-Decade for DM

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Medicare Understands the Problem:Chronic = Disproportionately Expensive

Source: Johns Hopkins, Partnership for Solutions, 2004


Medicare DM Demos: Virtually No Evidence of Success

• Medicare Health Support appeared to be the favorite son demo to expand DM into Medicare– MHS has attracted worldwide attention

– Legislation requires roll out if successful

• Elements of MHS model– Focus on highest cost/risk population (frail elderly)

– Disease management -- carve out to private companies & health plans ( vs. CCM)

– Guaranteed 5% savings business model

– Short term ROI

– Randomized control trial

• Results to-date: virtually no evidence of success. See http://e-caremanagement.com/first-official-report-on-medicare-health-support-dm-pilot-finds-virtually-no-evidence-of-success/

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Early MHS Results Are Not Encouraging

• First, although the intervention and comparison groups are similar at randomization, our analyses reveal that an unexpected pattern in PBPM differences between intervention and comparison groups emerges between the time of randomization and the start of the MHS pilots.

• Second, participating beneficiaries tend to be a healthier and less costly subset of the intervention group. Thus, high participation rates will likely be a factor in the ability of the MHSOs to impact their assigned intervention populations. And,

• Third, fees paid to date far exceed any savings produced. The negotiated MHSO monthly fees are a much higher percentage of the comparison groups’ PBPMs than the percentage savings on payments through the first 6-month pilot period. Fees negotiated by the MHSOs with CMS have not been covered by reductions in Medicare expenditures, let alone an additional 5% savings in Medicare payments. Without a substantial reduction in each MHSO’s monthly fee, budget neutrality after the first year is questionable.

• Source: RTI International Report to Congress: Evaluation of Phase I of Medicare Health Support (Formerly Voluntary Chronic Care Improvement) Pilot Program Under Traditional Fee-for-Service Medicare, June 2007

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Findings from Four Demonstrations

• No effects on adherence or self-care• Only 3 of the 20 programs reduced hospitalizations

or gross costs (4.5% reduction in MCC admissions)– Another had effects for CHF subgroup in urban counties

• No effects on mortality• Scattered modest effects on quality indicators:

– CHF: MCC reduced preventable hospitalizations– Diabetes: Telemedicine improved HbA1c, cholesterol, blood

pressure; MCC reduced preventable hospitalizations

• Patients love the programs

Does Disease Management/Care Coordination Work for Medicare?Does Disease Management/Care Coordination Work for Medicare?

Randall BrownArnold Chen

Deborah PeikesJennifer Schore

Dominick EspositoPresented at Academy Health Research

Meeting, June 2007




Meeting, June 2007

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Why Doesn’t DM Work Better?

• Changing patient and provider behavior is HARD:– Limited use of behavior change models– No incentive for physicians to communicate

• Some patients too ill, others not at short-run risk:– But targeting is not the major problem

• Programs don’t collect timely hospitalization and Rx info

• Usual care providers are minimally engaged





Meeting, June 2007




Meeting, June 2007

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Why Doesn’t DM Work Better?

• Programs led by marketers, not clinical experts:– Ineffective use of available data – Unfamiliar with unique needs of the elderly

• Contact info poor in population-based models • Improvements in quality of care don’t guarantee

better patient outcomes in short run





Meeting, June 2007




Meeting, June 2007


Many Other CMS Demo/Pilot Projects Involve Patients With Chronic Diseases

• Medicare is undertaking a wide range of demonstration/pilot projects

• Many directly involve patients with chronic conditions– Physician Group Practice (PGP) – Care Management for High Cost Beneficiaries (CMHCB) – Special Needs Plans (SNP)– Medicare Medical Home demonstration (discussed later)– and others


Beyond MHS – Testing Different DM Models in Medicare

• Beyond: focus on highest cost/risk population (frail elderly)– Prevention– Mainstream Medicare

• Beyond: carve out to private companies & health plans – Chronic Care Model

• Beyond: guaranteed 5% savings business model– P4P– Shared savings– Fee for service

• Beyond: short term ROI – Long term ROI– Long term quality improvement & compression of morbidity

• Randomized control trial– Observational studies– Rapid learning models


PROVIDERS: Care providers are waking up to DM

opportunities and threats.


Model #1: Disease Management Model• Medium sized, privately & publicly held companies• $1.6 billion revenues in 2006 • Payers are increasingly assembling DM components• Key elements

– Telephonic services, centralized call centers• Support patient life style change• Promote evidence based practice

– Started as carve-out model– Guaranteed savings promoted by DMPC– Focusing on highest cost, highest risk patients

• Challenges: physician buy-in, proprietary IT• Major players:


Model #2: Chronic Care Model

• Pioneered at Group Health Cooperative• Key elements

– Community based– Transformation of health care– Restructuring of physician practice

• Challenges: no reimbursement, academic/research focus

• Protagonists:


Who Wrote This Statement?

“The literature has correctly indicated that the term ‘care coordination’, which is often used interchangeably with the term ‘care management,’ refers to a variety of activities. – managing the transition of care across settings– use of patient registries to allow for population-based

care protocols, the – use of frequent follow-up with patients to promote

treatment plan compliance and to obtain healthcare data – use of clinical practice guidelines, including feedback to

the physician regarding their degree of compliance with the guidelines

– teaching of disease self-management skills to patients....”


• Was it written by a DM company? a home health agency? a health plan?

• No, it was written by...doctors!– Source: American College of Physicians Position Paper,

Reform of the Dysfunctional Healthcare Payment and Delivery System, April 2006

• ...and here's the punch line: “These care coordination activities are at the

core of what defines a primary care physician.”


The Cats are Herding:Medical Home Model Gaining Momentum


The Medical Home Model –Paying for Technology and Process Improvement

• Proposed payment framework for the Medical Home model includes $$ for:– coordination of care – health information technology – secure e-mail and telephone consultation;– remote monitoring of clinical data using technology.

• Medicare Medical Home Demonstration


Medicare Medical Home Demonstration (MMHD)

• December 2006 – Congresses passes MMHD• MMHD similarity to MHS: high cost, chronic

patients; multiple comorbidities• MMHD differences from MHS

– No requirement of 5% guaranteed savings– Physicians can keep 80% of savings


MAKE, ASSEMBLE, BUY? Fewer are buying as health

management becomes increasingly strategic.


Health Plan Views Of the DM Make/Buy/Assemble Decision Have Evolved

• 5 years ago– "DM is really complicated"– "It will take us 18 months to get started"– "Start up cost are significant“– “Let’s buy”

• Today– "DM isn't rocket science; we've learned from the

vendors"– "Care management is increasingly strategic; it is a core

competency that we need to do ourselves"– "We'll get better integration if we do it ourselves;

medical management workflow software is key”– “We need to assemble DM components and make sure

that we keep control over key leverage points”


TECHNOLOGY: DM in your home and your pocket.

Health care anywhere.


How Purchasers View the Health Care System


Tech Trends

A. Technology Convergence

B. 2008 Could Be A Breakout Year for Remote Patient Monitoring

C. Platforms For Interoperability & Transportability• Personal Health Records (PHRs)• Google Health• Continuity Of Care Record Standard• Mobile/wireless apps• Hospital At Home

D. Next Generation Technology – “You Ain’t Seen Nothing Yet”


A) Technology Convergence

CONSUMER TECH

INFRASTRUCTURE

Internet

Smart houses

Personal communications devices -- PDAs, cell phones, etc.

Broadband -- cable, DSL, satellite

Digital cameras, video

Wireless -- 802.11, Bluetooth, RFID, etc.

Voice recognition

etc.

eHEALTH APPLICATIONS Electronic Health Records (EHRs)

Personal Health Records (PHRs)

Remote patient monitoring

Fitness/wellness/prevention

Self care support

Physician/patient secure messaging

Home telehealth/telecare

Decision support systems

e-Prescribing

e-Disease Management

e-Clinical Trials

Predictive modeling

Computerized Physician Order Entry

Quality evaluation web sites

Patient reminder systems

etc.


Focal Points for ConvergenceHome Networks, Smart Phones, EHRs

PHR/EHRSmart

Phone

HomeNetwork

CONSUMER eHEALTH

Role of IT in Disease Management

Patient Facing

DM Provider Facing

Patient-provider communication tools (IVR, email)

MonitorEngage Intervene

Educate, Coordinate, TreatIdentify, Validate, Stratify, Enroll

Call center

Personal Health Record

Predictive modeling

Remote monitoring (biometric, tele-monitoring)

Personal assessment tools

(HRA)

Educational tools (websites, audio library)

Electronic Medical Record

Decision support tools (CDSS)

Outcomes, Feedback, Follow-up

Clinical integration tools

Disease registry


B) 2008 Could Be A Breakthrough Year For RPM

• Continua begins to address major challenges– Interoperability of devices– Pricing (indirectly)

• But other challenges remain– IT/integration– Reimbursement/business model– Licensure/regulatory issues

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...but Consider the Systemic Barriers

• Reimbursement• HIPAA: Privacy/confidentiality issues• Physician workflow• Technology maturity

– Infrastructure– Bandwidth– Interoperability/Standards– Friendly user interfaces

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C) Platforms for Interoperability & Transportability

• Personal Health Records• Google Health• Continuity of Care Record• Mobile/Wireless Applications• Hospital at Home


D) The Next Generation of DM TechnologyWhen the Technology is Just “There”

“Ubiquitous Health”

“Sense and Simplicity”

“Pervasive Computing”


BEHAVIOR CHANGE: DM is moving from a medical to a

social model; behavior change has become the Holy Grail.

The Holy Grail: Changing behavior to prevent disease

Behavioral Risk Factors

ChronicCHF

Clinical Risk Factors

Our Future1994-98 1998-2002 Current

Interactive Data Systems

• All of the above plus more real time two way remote interaction between pts., disease managers, and MDs (e.g. interactive TV, implantable devices, PDAs, cell phones, other wireless technologies)

Copyright © LifeMasters Supported SelfCare Inc. 2004 All Rights Reserved.


CLINICAL AND ECONOMIC ROI: Round one is over, DM wins;

Round 2 has just begun.


The DM/ROI Debate Of the Past 10 Years Has Not Always Been Framed Constructively

“DM has ROI”

“No it doesn’t”

“Yes it does”

“No it doesn’t”

“Jane, you ignorant slut”


Reframing the DM/ROI Debate:2 Seemingly Contradictory Statements

#1: Whether DM provides ROI has become irrelevant

#2: The DM/ROI debate will continue to be scientifically evaluated for the next decade


#1: The DM/ROI Debate Has Become Irrelevant DM Has Gone Mainstream


#2: The DM/ROI Debate Will Continue To Be Scientifically Evaluated For The Next Decade

• #1 = DM today• #2 = Continuing DM ROI and outcome measurement for the

future

No evidence

Preponderanceof

Evidence

Beyond AReasonable

Doubt

Clear andConvincingEvidence

AbsoluteCertainty

0 100

Level of Proof

•Source: With attribution to Gordon Norman, MD, MBA, Chief Medical Officer of Alere

#1 #2


WILDCARDS!


Watchful Waiting....

• Will employers stay the course in supporting DM?• Payers (health plans, employers, government) are

placing heavy bets on personal health records (PHRs). Will they pay off?

• Can pay-for-performance P4P initiatives align incentives?

• Can U.S. style DM be exported to international markets?

• Will Consumer Driven Health Plans (CDHPs) be the spark to ignite a consumer model of chronic disease management?


APPENDIX ABetter Health

Technologies, LLC


Better Health Technologies, LLC

• Technology and health care delivery are shifting: – From: Acute and episodic care delivered in hospitals and

doctors’ offices

– To: Chronic disease and condition management delivered in homes, workplaces, and communities

• BHT provides consulting, business development, and speaking services to assist companies in: 1) Understanding the shift 2) Positioning – what’s the right strategy, tactics, and business model? 3) Integrating your offering into the value chain – what are the right partnerships?

• Complimentary enewsletter: www.bhtinfo.com/pastissues.htm


BHT ClientsPre-IPO CompaniesHealthPostCardiobeat EZWebSensitronLife NavigatorMedical Peace Stress Less DiabetesManager.com CogniMed Caresoft Benchmark Oncology SOS Wireless Click4Care eCare Technologies The Healan GroupFitsenseElite Care Technologies

Established organizationsIntel Digital Health GroupSamsung Electronics, South Korea -- Global Research Group -- Samsung Advanced Institute of Technology -- Digital Solution CenterAmedisysMedtronic -- Neurological Disease Management -- Cardiac Rhythm Patient ManagementSiemens Medical SolutionsPhilips ElectronicsJoslin Diabetes CenterGSKDisease Management Association of America PCS Health SystemsVarian Medical SystemsVRIWashoe Health SystemS2 SystemsCorpHealthPhysician IPACentocor

© 1 Chronic Disease Management Megatrends August 2007 Vince Kuraitis JD, MBA Better Health...

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