Cooperative Health OverviewManaged by
Agenda
• NJPA Overview
• Benovate Overview
• What is happening? Why? (trend)
• The Cooperative Health Program
• Creating the Savings with Competitive
Bidding
• The Impact on our Clients
Who is NJPA?
• National Joint Powers Alliance
• Cooperative Purchasing
• Government Agency
• National Solutions under Contract
• NJPA Cooperative Health Program
Who is Benovate?
• NJPA Cooperative Health Program
Manager
• Develop Low Risk “Health” Pools
• Health Management
• Risk Management
• Cost Containment
Benovate solutions to control costs
• Utilize Predictive Modeling for Health Engagement
• Health Assessments & Screenings
• Focus on Sleep, Stress, Lifestyle, Disease Prevention
• Health Coaching & Advocacy
• Health Technology & Web Based Solutions
• Custom Wellness & Care Plans
• Health Rewards Platform
• Employer Outreach & Hospital Integration
6
201320122011201020092008200720062005200420032002200120001999
$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000
$16,351*
$15,745*
$15,073*
$13,770*
$13,375*
$12,680*
$12,106*
$11,480*
$10,880*
$9,950*
$9,068*
$8,003*
$7,061*
$6,438*
$5,791*
$5,884*
$5,615*
$5,429*
$5,049*
$4,824*
$4,704*
$4,479*
$4,242*
$4,024*
$3,695*
$3,383*
$3,083*
$2,689*
$2,471*
$2,196*Single CoverageFamily Coverage
Average Annual Premiums for Single and Family Coverage, 1999-2013
Why? Healthcare Trends
7
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130%
50%
100%
150%
200%
250%
57%
119%
182%
56%
117%
196%
14%
34%
50%
11%29%
40%
Health Insurance PremiumsWorkers' Contribution to PremiumsWorkers' EarningsOverall Inflation
Cumulative Increases in Health Insurance Premiums, Workers’ Contributions to Premiums, Inflation, and Workers’ Earnings, 1999-2013
Why? Healthcare Trends
NJPA Conclusions
• Traditional Consumer Driven Plans Weren't Working
• Network Model was antiquated.• Employers could benefit enough to want to
extend healthcare into the workplace. • Employees needed better more convenient
access to care and care coordination• Traditional care model assumes one size fits all• Traditional wellness was only a piece of the puzzle• The Problem is “Trend”, no end in sight without a
different model
Create Neutral Risk, Lower Future Exposure
Changing the Game: Gaining Control of Risk
• School Districts• Municipalities
• Non-Profits• Higher Education
Health Management Required
45%
Cooperative Health: Creating a Health Rewards Pool
50%
30%
20%
Current Fully Insured or Self Funded
2014
2015
Benovate Partially Self Funded Option
15%
15%
15%
15%
43%*
VS.
2014 2015
Avg: 12.8%
Avg: 5%(From Soft Quote)
Benovate Partially Self Funded Option
45%
15%
15%
15%
15%
43%*
Long TermPremium Control
Goal Loss Ratio: < 25%
Cooperative Health: Creating a Health Rewards Pool
* Leverage Improved Claims Experience for Lower Premium
Creating a Health Rewards PoolReturning your MoneyAchieving the Goal of 25% Less then Underwritten
Reinvesting in Health
• Max Premium: $400,000• Goal Loss Ratio: $300,000 • Available Incentive: $100,000
• Total 2014 Claims: $320,000
• Fund Incentives Programs
• Offset Health Management Expenses
• Allocate % to Captive
• Reduce Premiums Next Year
• Fund FSA/HSA/HRA• Health Rewards
• Health Bonus• Voluntary Benefits
Sample Group90 Lives (Bronze Plan: Employer 60% Payment)
Employer Use of Funds Sample
Employee Use of Funds Sample
Goal: Health Rewards Captive
Managed Risk
• Max Risk is Total Premium
• Aggregate Risk Policy for Claims Over Premium
• Specific Loss Policy Per Person
• ACA Compliant
Lower Costs
• Lower Cost Structures• Efficient
Administration• Transparency• Prevention Focus vs
Treatment• Lifestyle Change
Better Health
• Safer Work Environment
• More Productive Employees
• Increased Awareness
• Lower Presenteeism, Absenteeism
Health Rewards Program Benefits
Controlling Health Care Costs
The Health Care Cost Equation
Healthcare Services Costs (Costs)
Multiplied by (x)
Healthcare Services Utilization (Utilization)
(=‘s) Equals Total Healthcare Costs
Healthcare Cost Equation
4 Strategies To Control Costs
Gain Control of the Cost Structures
• Predict Disease
• Predict “Un-health”
• Create Transparent Cost Structures
• Review & Audit (before you pay)
#1 Control Costs: Create a Pre-disease ModelAvg Cost of Heart Attack; $67,000, Avg Cost to Prevent, $3,700
• Predictive Health Modeling
determines risk by condition
and lifestyle.
• Drives “appropriate”
Utilization.
Cos
t
• Health Risk Assessment• Stress Risk Assessment
• Behavior & Lifestyle Data• Biometric Data
#2: Determining Health Risk
#3: Transparent Cost Structures
• Transparent Pharmacy Benefit Management
• “Cost Plus” and “Reference Based Billing”
• Insurance Captive, Claims Data & Management
• True “3rd party” Third Party Administration
Transparent Pharmacy• 500 Employee Company: Re-priced
– Pharmacy Represented 22% of the total plan cost– Spread elimination: $119,426 of $741,000, 16%– Rebate Reduction Estimate: $8,000, 1%– Therapeutic Substitution: $14,076, 1.8%– Total Savings: $141,502; 19% Total Savings
• Typical Charge Master– Network Discount, 30-70% off of what?– Medicare plus 150%-400%– Cost Plus Medicare plus 54%– Reference Based Pricing, Medicare plus 100-150%
“Cost Plus” or “Referenced Based Billing”
Level Funded, Unbundled Self Funded, to Captive
Benefits• No Risk Contribution• Like Minded Employers• Control Costs Today• Manage Trend in the Future
Benefits• Lower Cost• Increased Transparency• Reporting and Cost Control
“3rd Party”, Third Party Administrator
Strategy #4: Medical Bill Review
Alabama Union Group• 100% of all OON claims reviewed had adjustment• $376,196 in savings adjustments• Average claim reviewed $22,935• $10,449 average savings per claim
Arkansas Company (small group)• 100% of all claims (17) had adjustments• $311,000 in savings adjustments• Average claim adjusted $37,423• $18,297 average savings per claim
4 Strategies to Control of Utilization
1. Align your “group
utilization”
2. Eliminate “One Size Fits All”
Health Management
3. Data Driven Plan Design,
Cost Focused Consumerism
4. Drive Appropriate
Utilization, Incent Care Plan
Execution, and True
Lifestyle Change
#1 Group Utilization Summarized
• The Kitchen Table
• Plan Cost
• Deductible
• Co-Pay
• Rx Costs
• “The Value”
o The Plan vs No Plano My Plan vs My Spouses Plano Employer A vs Employer B
Avoiding One Size Fits All
Marketing Message Across the Entire Population
#2 Customized Intervention
#3 Standardize Plan DesignRate Step Correlation to Employee Plan Selection
If I have healthcare needs, premium costs are
irrelative.
If I am healthy and young, I may look for alternatives.
If I am single and young, I may just waive and pay the
PPACA penalty.
#4 Driving Appropriate Utilization
Wisdom of the Medical Home
• Primary Care Physician Relationship works well
• Patients rate relationship and respect highly
• Biggest factor in deciding whether or not to
participate
• Higher rates of preventative care delivered
• National best practice control of targeted chronic
diseases
Stress, Sleep, & Lifestyle
Blood Chemistries: Body Analysis: Total Cholesterol VLDL ALT (SGPT) Weight
HDL LDL/HDL ratio AST(SGOT) Height
LDL Lactate Dehydrogenase (LDH) ALK PHOS Waist Circumference
TC/HDL Ratio Total Bilrubin Cotinine (Tobacco Use) Hip Circumference
Triglycerides Bun GGT(liver function) Wrist Circumference
Glucose Total Protein BMI
Uric Acid Creatinine PSA (for males 50 +) Body Fat Content
Globulin Calcium
Determining Risk
• Health Risk Assessment• Stress Risk Assessment• Behavior & Lifestyle Data• Biometric Data
Standard Biometric Panel
Mental and Nervous System, Metabolic, Cancers and Musculoskeletal
The “Big Four”
Control Costs: Stratify RiskAggregate Disease Risk Report
There must be an understanding where the costs really are…and where they are going
One Size Does Not Fit All
Conditions & Lifestyles Mapped
Cost of Care: Revenue & Expense Modeling by Condition, Network Alternative
• Physical, financial,
relationship
& personal development
health
• Individualized Coaching
• Employee and Family
• Stress Management
• Improved Health
• Assistance Navigating
DiseasePhysical Health Relationships Career/Growth Finance
Health & Lifestyle Coaching
Personal Health DesktopThe Personal Health Desktop (PHD) is a secure, online HIPAA-compliant web portal accessible from any Internet-connected device. This system provides participants secure access to features including:
• Medical history/lab results• Health Risk Assessments• Personal Health Assessment
reports• Risk Resolutions guidelines• Medical library• Health Counts rewards program
Access to Assessments & Data
• Earning Points, Rewards, or Dollars for Care Plan Engagement
• Improved Health• And… True Lifestyle Change
Provider & Community Engagement
Benovate’s “Your Data” Approach
• Give the consumer the data and tools
• Incent Participation
• Provide Coordination
Goal: Data Driven Consumerism
Hospital - ProviderRelationship Strategies
Wellness Strategies
Alternative Funding
Plans
Plan DesignOptions(HDHP)
FixedCosts, PlanFlexibility
& Reinsurance
Employee cost-shift to target
PlanUtilization
Population Health Management
& Improvement
Plan Design,Contribution& Population
Alignment
Risk PoolManagement
On-site Medical ClinicsNarrow Physician NetworksHospital Cost Plus Contracts
2% - 3% 5% - 6% 7% - 10%5% - 7% 4% - 8%
Employer Strategy & Savings Continuum
Summary: Tying it All Together
Phased Deployment of Solutions
Assessments &
Early
Interventio
n
Custom Wellness & Care
Plans
Incentives for Healthy Choices
Health & Lifestyle
Discounts
Lower
Cost
Health Management
Our process is built upon five very important steps to improving health and decreasing cost
Measureable Outcomes
Per Participant Risk Burden Trend
Connectivity
Considerations for Engagement
1. Request and analyze your data2. Target areas for improvement3. Phased Approach; Manage then Engage in Health4. Community Initiative: Affiliate
Thank you!
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