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Value-based Benefit Design An Employer Coalition Approach William L. Bruning President & CEO, Mid-America Coalition on Health Care.

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Presentation on theme: "Value-based Benefit Design An Employer Coalition Approach William L. Bruning President & CEO, Mid-America Coalition on Health Care."— Presentation transcript:

1 Value-based Benefit Design An Employer Coalition Approach William L. Bruning President & CEO, Mid-America Coalition on Health Care

2 2 KC 2 : A Truly Collaborative Model

3 3 $400,000$600,000 Loeppke, R., Taitel, M., Richling, D., Parry, T., Kessler, R.C., Hymel, Pl., and Konicki, D. Health and productivity as a business strategy J Occup Envrion Med. July 49(7):712-21, 2007 $200,000 Anxiety Obesity Hypertension Arthritis High Cholesterol Sleeping Problems Other Chronic Pain Fatigue Depression Back/Neck Pain Medical Drug Absence Presenteeism Top 10 Medical, Drug & Productivity Costs -- per 1000/FTEs --

4 4 Value-Based Benefit Design: Restructuring Health Benefits VBBD is a strategy that minimizes or eliminates out-of-pocket costs for high-value services in defined patient populations  High-value services are identified through scientific evidence  The more clinically beneficial and cost-effective the therapy is for a patient group, the lower the out-of-pocket costs Lowering out-of-pocket costs for high-value services has been found to improve access to and use of those services More effective use of high-value services may positively impact the health of the targeted population  Preventable adverse health consequences reduced  Related high-cost health care services avoided Chernew ME et al. Health Aff (Millwood). 2008;27: ; Fendrick AM et al. Am J Manag Care. 2001;7: ;Fendrick AM, Chernew ME. Am J Manag Care. 2006;12 (special issue):SP5-SP10.

5 5 Value-Based Benefits: Turning Theory into Solutions Applicable in any company large enough to be focused on benefits and plan design  Not just for large employers, with big HR budgets, sophisticated HR staffs, and a C-Suite that understands the value of benefits Expensive data integrators are not mandatory  Employers can make better use of their existing data  Employers can partner more effectively with vendors Not just about “giving away benefits and drugs,” it’s about:  Maximizing the value of your data to understand your employees’ health risks and stratify your employee population  Measuring what you’re already doing  Messaging to employees and C-Suite on the impact of health

6 6 17 Employers, 64,000 KC Employees; 463,000 Lives Firm Wide Firm Wide Small to Mid-SizeMid-Size to LargeJumbo # EEs375 – 3,0003,000 – 10,00010,000+ H&R BLOCK Trademarks on this page are the property of their respective owners

7 7 VBB is not Just for Large Employers Of the 17 participating employers, 4 have fewer than 1,000 employees in KC, and 8 have fewer than 2,000 employees The median participating employer has 4,000 employees firm wide The fundamental issue of understanding your data and workforce risks is key for all employers The KC 2 Tools are being tested for employers of all sizes Trademarks on this page are the property of their respective owners

8 8 Methods: Initial Survey and Employer Interview Source: KC 2 Project Team What Kansas City employers told usExcerpt from Initial Survey: 83% currently use data to assess employee health risks 61% believe they face more challenges with internal data collection than from outside vendors Top perceived barriers to implementing VBB Employee Resistance Cost of interventions/utilization Biggest influencers in benefit design Cost / Trend Corporate culture and leadership

9 9 Best practices & case studies What works to get through stages of the data cycle Want to hear about absenteeism, productivity and retention from other employers “Knowing how the private sector measures their bottom line” Examples of how others are getting and using data to show outcomes Working through issues of plan design Collaboration and workgroups to share ideas “Toolkit or framework to evaluate a decision from a direct cost impact, short term impact and long term impact” Idea generation Idea sharing Idea validation ROI template Education Better understanding of the local community Benchmarking “A plan design that will lead to the best result” Peer-to-peer review of practical applications “What would make participating in this VBB coalition meaningful and valuable to you?” Employers Have Asked For:

10 10 Process of Applying Value-Based Benefits Start Here: Identify and collect data Identify and collect data Integrate data Integrate data Use data to classify risks eg. Chronic disease, lifestyle, high dollar claims Use data to classify risks eg. Chronic disease, lifestyle, high dollar claims Establish goals, design and conduct worksite interventions that remove barriers to healthy choices. Establish goals, design and conduct worksite interventions that remove barriers to healthy choices. Measure and evaluate outcomes ROI Measure and evaluate outcomes ROI SUSTAINABLE CHANGE © 2007 Mid America Coalition on Health Care

11 11 Methods: Data Map Source: KC 2 Project Team

12 12 Methods: Employer Data Tracker (EDT)  Demographics  Benefit Design  Health Risk Appraisals  Health Screenings  Disease/Case Management Interventions  On-Site Clinics  Employee Satisfaction Source: KC 2 Project Team  Claims –Medical/Pharmacy –Short- and Long-Term Disability –Workers’ Compensation –FML  Laboratory Tests  Employee Assistance Program  Productivity –Absenteeism Excerpt from EDT:

13 13 Baseline Data Completeness Data Gaps

14 14 KC 2 Intervention Model Overview Value of Investment

15 15 Identifying VBB Interventions Employer-specific Measurable Evidence-based Optimizes outcomes Definition: Health Management Team Actionable Data Environment or Policy Insurance Benefit Design Employee Engagement Vendor and Provider Value Focus: Source: KC 2 Project Team

16 16 Business Goals and Objectives Make Health a Core Business Strategy Align Data Definitions Across Internal and External Sources Increase Access to Data Integrate Sources to Create More Actionable Data Further Develop Data Capabilities Health Management Team (HMT) Actionable Data Incorporate Key Positions Foster Health Champions Create and Communicate Corporate Vision of Health

17 17 Population Health Goals and Objectives Environment and Policy Insurance Benefit Design Employee Engagement Subsidize Healthy Food Options in Cafeteria and Vending Machines Implement Smoke-Free Worksite Policy Require Input of Biometric Data on HRA for Credit Abbreviation: FSA: Flexible Spending Account Vendor & Provider Value Improve Health Status by Reducing Cardiometabolic Risks Waived Co-Pay for Preventive Screenings or Target Drugs Covered Benefits for Health Coaching for Target Conditions Employer FSA Contribution as Incentive for Engagement Increase Participation through Incentives Increase Employee Satisfaction Implement Weight Management Intervention Work with Partners to Identify Employees/ Dependents with Targeted Risk Factors Work with Partners to Develop Communication Plans Work with Partners to Standardize Measures

18 18 Frame Evaluation and Identify Measures Inputs What We Invest Outputs What We Do, Who We Reach Outcomes What Results Processes Enrollment Participation Frequency of contact Service utilization Financial Human  Mental  Physical Organizational Capital Business  Presenteeism  Productivity  Overtime  Absenteeism  Replacement Wages  Retention  Recruitment  Spend  Trend  ROI Short-Term, Mid-Term, Long-Term Employee  Health Behavior  Health Status  Growth and Performance  Engagement  Tenure Source: KC 2 Project Team

19 19 Near-Term Operational Results Mid-Term Health Outcomes Evaluation: Establishing the Business Case What’s the cost of doing nothing?* What’s the cost of intervening? Measuring Operations Is intervention reaching target population? Is it being implemented in the ways specified? Measuring Program Effectiveness Is intervention effective? What’s the connection? Engagement  health outcomes Health outcomes  productivity Long-Term Financial Outcomes Measuring Costs * Edington, D. Zero Trends: Health as a Serious Economic Strategy. Health Management Research Center, University of Michigan. Ann Arbor, MI

20 20 Near-Term Operational Results Long-Term Financial Outcomes Mid-Term Health Outcomes Value of Investment (VOI)* Corporate Viability Profitability Growth Opportunity Sustainability Corporate Culture of Health Support for Future Initiatives Success Builds Success VOI * Source: American Hospital Association

21 21 What does “demonstrating value” mean in your organization? What do you need to know about your interventions to determine if: You reached the right people? Programs were well-implemented? Healthy stayed healthy, those at-risk lowered their risks? Health outcomes improved? Costs were better managed? What’s important to your senior leadership to engage them in continuing to make health a core business strategy? Key Questions Shape Evaluation Planning

22 22 Sharing a Successful Approach Under Construction

23 23 Spreading The Word About Value-Based Benefits Presentations and Public Relations  Local and National Association Meetings  Using the media to tell the story Employer Guide, including:  Tools and Modules used  Employer case studies  Lessons learned  Resources available to employers Replication  National Business Coalition on Health (NBCH)  Pfizer Inc.  Online presence

24 Questions? William L. Bruning Mid-America Coalition on Health Care © 2009 Kansas City Collaborative All rights reserved. PHF01265L


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