I’m at the WHCC as the official blogger! First up is a session with big employers and their vendors from the plan world (although apparently George Halvorson from Kaiser had a minor heart attack and has been replaced by Jay Crosson from Permanente)
Ivan Seidenberg, CEO Verizon, wants portable affordable insurance, and more IT use in healthcare. Broadband will save the day! (In Virginia, Inova is using their broadband to run its eICU), and this will end up in the home, in his vision. And we should have EMRs for all, personally managed but available to all providers. Verizon is going to provide a PHR for its employees, with coaching et al.
The senate has passed legislation to help promote EMRs, and he wants more from the government on this! And he applauds those who have looked “beyond” employer mandates, and he thinks that consumers will demand the information and disrupt the marketplace.
Michael Critelli, CEO Pitney Bowes, heads a company that’s (somewhat famously) looked closely at chronic care. They have avoided cost shifting by changing the infrastructure costs. They created on site medical clinics for routine needs of employees. Services and Rx are free. The average costs of those in the clinics is lower than the rest. Their spend was 20% lower than those they benchmark. In 2000 they got a big rate increase, and so then tried to figure out what was happening? The biggest problem was people not taking their meds because of cost. So they moved to expanded coverage for generics, and lowered the cost for first line Rx, and got rid of costs for preventive services. Added costs are the main reason for people skipping coverage, plus high health costs are hitting earnings in Corporate America. So we still need to do more.
Critelli: The workplace is not necessarily the best place to reach people…perhaps the broadband approach might work (as Seidenberg said)
Jay Crosson thinks that high deductibles have incentives in the wrong way. 1% of Kaiser patients run up 40% of the costs. He likes the Pitney Bowes concept.
H Edward Hanway: Worried that the perception that CDHP is just a cost shift. Corporate CEOs may be interested in behavior change and are interested in spending their money in different ways. A perception that they’ll have to work hard to dispel!
Jay Crosson; Financial responsibility is OK, but just imposing large deductibles is a blunt tool.. KP trying to create a clinically driven high deductible plan
Seidenberg—verizon supports a mandate to change something. Current system has run its course. Verizon wants to participate in that redesign, but wants to get out of the health care business. We don’t buy houses, buy cars, why should we be in the business of buying health care? We need to get out the language of shifting cost, to that of “shifting responsibility”. America must be ready to tackle the overall issue.
Hanway–Information and health coaching works no matter what the financial incentives, so far based on what they see from their data, even if their financial responsibility increases. But it cant just be “stick a HDHP on them”.
What about Romney care? The audience mostly think it’s a good start (only 25% think it’s terrible and 1% think its a real solution)
Jay Crosson—hopes that employers won’t leave health care coverage. But we’re in a lifeboat and everyone’s got to pull on the oar, or we run the risk of all this going in the wrong way.
Seidenberg—we want to get out of the business of wholesale subsidies. We found that people were buying drugs and not taking them. Should there be financial incentives to providers to make them do that. Also he supports vouchers and ways to buy into the system. But he thinks that competition across plans will help
Hanway—Mass will prevent insurers from creating affordable insurance, but the direction is encouraging.
Crosson-individual mandate is one way to get everyone in the game, which we need. But will there be insurance available to buy? Where will the money to come from to subsidize care for those who cant afford it? Where’s the mechanism for restricting costs?
This is my first notes of an interview with Michael Critelli, CEO Pitney Bowes. Definitely one of the CEOs in America who’s thought most about this topic. Most of the questions were submitted from the audience in rather interesting system from VisionTree.
What about the cost that are from the most significantly disabled/sick people?
By the time that they become disabled, no choice but to manage their condition in conjunction with them. CDHC is a long term investment to prevent significant disabilities, it’s a piece of a solution but not so appropriate when you get to significantly disabled people. At that point you are trying to get them to take charge of their conditions… but there are many things they can do even then (diet, exercise, following treatment)
What about the role of insurers?
Insurers are working to improve the outreach, but some more enlightened than others. Some do better than others. some are better at collecting data, others better at identifying high quality providers, but overall a mixed result…
Why cant health insurers push harder to get transparency?
There’s a range of behaviors by consumers. Some prefer simplified pricing, others like to buy a la carte…saying that everyone wants standard pricing ignores the fact that restaurants don’t all offer prix fixed meals. The best solution would be a combination of simpler and more complex pricing.
Why is PB an outlier in its health strategy?
Too many employers looks at this as a cost item year to years rather than a long term investment-when you’re cost driven you have the perverse outcome. There has been a lack of leadership in benefit and HR functions. Could we have had this ten years ago? Yeah and there were equally stupid business leaders then (direct quote!)….in their own business (mail services) procurement people don’t look at life cycle costs over procurement. People are very scared of factoring in real consequences of decisions. When PB built the clinics they took a leap of faith that it would save on absenteeism, but they couldn’t precisely quantify that, and the people running health care internally wouldn’t give it credence but he overruled them…luckily
Are PBMs a help or hindrance?
Can be used for positive or negative results. If they monitor usage for compliance or drug reactions it’s a positive. PBMs also a source of information as to whether they’re using rescue drugs rather than preventative drugs. In the wrong hands can just be a tool for cost shifting.
Are the major PBMs saving employers money?
Given their growth I assume that there must be doing something right. The people who run them are pretty sharp
Is it too much to ask that employers partner with employees?
Employer/employee partnerships improve outcomes, productivity, quality. Always a benefit to the employer doing that for the spin-off effects….even if not providing health insurance there is still be a benefit to doing that partnership
Is health care IT going to save money?
The portable PHR is going to be a significant part of the solution. To get physicians online needs a comprehensive IT program that is top down driven. Providers are not going to invest in IT unless there’s a network effect. Providers don’t want to put a lot of money into supporting the systems, needs to be some part of a larger universe. Government and industry (tech vendors) have to come together on common data standards (need UPC equivalent) Will take a long time. PB has been at it in postal reform for 11 years. If 10 years from now we had PHR standards that would be a success.
Health plan profits are at record highs—are they providing value?
Employers not happy. Got to have the sense that the money they’re paying in is being reinvested to improve outcomes. Some plans are doing better than others, but overall the position is mixed. The one area that more needs to be done is to use traditional marketing segmentation tools to identify the diverse populations that they cover and see what works