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Power to the People

April 1, 1998
by Charlene Marietti
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Healthcare consumers are taking charge. With the support of government, pharmaceutical companies, employers, health plans, and some healthcare organizations, consumers are taking responsibility for their own health and well-being under a new type of healthcare management termed population health management. This proactive approach includes all aspects of healthcare with particular focus on improving individual health levels as a claims cost-reduction strategy.

As a new age of accountability dawns, the spotlight on healthcare shifts from the provider and medical treatment delivery mechanisms to the individual. This transition brings an empowered patient into a working partnership with the healthcare provider.

New information technology systems and applications with innovative support mechanisms and educational opportunities are emerging in real and virtual healthcare communities. Also emerging are new ways to look at risk management and the individual. "It’s time to think about the moment of intervention at a different level," says Neal Sofian, VP of program and business development, Lexant, Seattle, a health risk management service organization.

Proof of purchase

Population risk management studies that link individual health styles with medical claims costs are building solid evidence for return on investment and fueling adoption of health promotion and personal behavior programs. Proof of savings, the increased understanding of behavior-based education and intervention methods and contemporary marketing practices are leveraging new and existing technology tools. Although a true multimedia program has not been consolidated into a solidified marketing approach for all members of the population, efforts are under way from various segments of the industry.

Healthcare organizations must pay attention to population health management for two reasons. Not only will it be necessary to rethink the healthcare delivery system in terms of managing wellness and chronic diseases for members in an increasingly competitive environment, but it will be important to consider the opportunities from the employer’s perspective. Many insurers, healthcare providers, health plans, employers, pharmaceutical companies and consumers are already actively investigating population health management’s potential to supplement the traditional care delivery system; hospital and integrated delivery system decision-makers must be ready.

The direct relationship between personal health and medical costs has long been considered a given, but not quantified. The outcomes measurements critical to cost benefit determinations have traditionally been a weak link in assessing the performance of a delivery system, mainly due to lack of communication among providers and among systems. Dee Edington, PhD, dean of the Department of Kinesiology at the University of Michigan Health Management Research Center, Ann Arbor, Mich., has been a leader in trend management and risk stratification studies linking health promotions with cost outcomes. His studies related to work-site health promotions and disease prevention highlight the financial benefits associated with personal health risk management and detail return on investments.

Edington centers his research on risk factors--those pointers that indicate less than optimal health outcomes. They are directly proportional to cost: As risks go up, costs go up. He estimates the economic value of assessing and changing one risk factor for one employee for one year can realize $300 in cost savings to the payor. To that end, he encourages increased use of health risk appraisal participation by individuals as a key cost saving strategy. In his trend management schema for optimal impact and health status, the individual’s risk level would be assessed, interventions assigned, resources allocated and outcomes measured to quantify the performance of the healthcare interventions.

A number of large employers are evaluating the economic potential of health promotion programs as a way of reining in healthcare expenditures and absenteeism costs. In one such example, New York-based Citibank, N.A., implemented a high-risk intervention program among employees to identify the validity of the strategy and to determine the cost benefits of such a program on health outcomes and costs. Jan Murnane, corporate director of health promotion and the employee assistance program, says that although the voluntary program was not randomized, follow-up financial analysis yielded a return-on-investment ratio that brought attention from management and a commitment to expand the program.

Tightly integrated with health management cost-benefits are quality-of-care issues. Service costs can point to intervention requirements, but they cannot prove cost-benefits, says Sofian. More studies showing positive returns on investment will drive payors to demand managed health strategy implementations before quality standards of care are addressed. Although managed care organizations will first respond to payor initiatives and cost-based strategies, attention will quickly transfer to quality-of-care issues, he says.

Reach out and touch some ’one’

"There are huge opportunities to use existing marketing techniques in healthcare," says Edington. New technologies that can automate the process of assessments and identification of risk factors, facilitate communication between providers and patients, and customize health programs to the individual are capable of changing the fundamental equation of population health management. Integration of new technologies with population health management programs has particular promise in bringing about behavioral changes that will result in reduced risk factors and better disease prevention and chronic disease management.