Employers don't need a high-deductible feature in order to manage a successful and profitable consumer-driven health plan. In fact, some proponents of CDHPs warn employers that pushing high deductibles could cause workers to make poor decisions and spend unwisely, ultimately costing businesses more money.
"Consumer-driven health involves giving [employees] the right incentives," Andrew Webber, president and CEO of the National Business Coalition on Health, said in November at the organization's annual conference. "In some instances, it's lowering out-of-pocket expenditures. We need to encourage them to select better services and providers. We have real concerns with the high-deductible model."
As an alternative, Webber and like-minded colleagues promote value-based benefit packages. Under such plans, out-of-pocket costs are adjusted based on an assessment of the clinical benefit to a specific patient population. Therefore, the more clinically viable the therapy is for the patient, the lower the cost should be.
High-deductible plans that promote cost-containment often curb the use of essential and excessive therapies alike, proponents of value-based purchasing argue. Value-based insurance designs, on the other hand, recognize that services vary in the value they provide to patients, and that not all patients with a specific condition receive the same level of treatment. Rather than focusing on cost compression, proponents liken the VBID design to an investment in health.
"I love the idea of consumerism and well-informed patients," says Mark Fendrick, co-director of the University of Michigan Center for Value-Based Insurance Design. "At the same time, I'm often intrigued why education and information for consumers has been tied to high deductibles. I think this is unfortunate. I have no idea why it happened [and] we're trying to break it."
Fendrick argues that health leaders need to create a mentality among consumers that purchasing medical services should be approached like other valued goods they shop for, such as clothing, cars and electronics. "Every one of you has a current benefit plan that suggests that every doctor visit is the same, every diagnostic test is the same and every drug in a given tier is the same," he told NBCH conference attendees.
Better data needed
Health plans need to do a better job of sharing essential medical information, however, if VBIDs are to thrive, NBCH concluded in a report released last fall. The report is based on data gathered from nearly 200 health plans and insurers nationwide as part of NBCH's eValue8 program.
While all surveyed plans offer provider directories - a critical tool for consumers - far fewer provide mortality or complication rates where applicable (28%) and patient experience data (31%).
In addition, NBCH reports:
· 28% of plans provide information on a physician's accessibility by e-mail, and 15% provide information on the availability of Web consultations.
· For diabetes, 38% indicate they modify copays for pharmaceuticals, tests and/or equipment, and only 28% modify deductibles.
· For depression, 15% modify copays and 11% modify deductibles.
· 56% of plans send reminders to doctors regarding which members need breast cancer screenings, and 46% send reminders about colorectal cancer screenings.
"[The] results prove health plans are collecting information that would be helpful to doctors and patients, however, many are not leveraging it to improve health and health care," says Webber. "[We] call on health plans to better utilize the trove of claims data at their fingertips to provide information for consumers."
Value-based success
Marriott has embraced VBID and has shown that it can lower pharmaceutical costs for some workers. As part of its VBID pilot program, which began in 2005, the hotel chain reduced copayments in its tier-one drug formulary from $5 to $0, and copays for tier-two and tier-three drugs were reduced by 50%.
In addition, Marriott waived copays for generic drugs related to heart disease, diabetes and asthma to encourage members to continue or begin taking medications to better manage those conditions. Researchers also monitored a control group where reduced copays weren't offered and drugs weren't covered.
Marriott found that adherence increased significantly among the clinical group in most of the generic drug categories where copayments were waived. Out-of-pocket costs for the targeted generic drugs fell 65%, while control members' costs fell only 1%. In addition, out-of-pocket costs for brand-name targeted drugs decreased 27%, while control group members' costs went up by 4%.
Marriott noted its costs for health care did not change significantly despite waiving copayments for some drugs and lowering copayments for others.
Lost productivity
If Marriott and other VBID programs are to show continued success, however, employers must take into consideration the impact of depression, sleep deprivation, fatigue and other conditions that are not normally documented under health claims, explains Tom Parry, president of the Integrated Benefits Institute.
"These are drivers of lost productivity and are things that tend not to show up in medical claims databases," Parry remarks. "So from a productivity perspective, you may be missing an opportunity if your focus is too narrow on value-based benefit designs. [VBIDs] have a key role to play, but you can't look at them as the silver bullet of health care costs because it's only part of the issue. Productivity almost always comes up as a bigger item."
Parry believes the use of self-reporting tools administered by HR to employees could provide employers an accurate snapshot of how absenteeism and presenteeism affect productivity. IBI has conducted research, he says, that has shown that self-reporting is a good way of understanding how worsening conditions could affect productivity.
IBI plans on launching a Web-based self-reporting tool in conjunction with Harvard Medical School that employers could replicate and use for their workers. Look for more coverage on value-based purchasing in the March EBN.
