Situation

We recently worked with a client who provides diversified engineering services. While the group comprised a relatively young population, healthcare costs had been steadily rising the last three years, and they could not pinpoint the cost drivers contributing to these increases to even begin understanding what to do to curb those increases. The client was not clear which of the specific common factors (overuse of ER, declining population health, unmanaged chronic conditions, high pharmacy spend) was the prime factor in order to focus resources.

Approach

Processing the client’s claims data through z5, we discovered a consistent prevalence of 5  chronic diseases that were much higher than the national benchmarks – hyperlipidemia, hypertension, diabetes, chronic pain and blood disorders. Commensurately, in terms of population risk, the high-risk cohort was more than twice what we expect in a similar group.  Our analysis also showed that preventive office visits much lower than average for this group.

A second finding was their pharmacy spending totaled 8% higher than it could have been, again based on benchmark comparisons. We saw too that average script costs were 10% higher than benchmarks.

The third and an intriguing find was that all the cases of ER overutilization were tied to members that had one or more of the 5 chronic conditions problem areas identified.

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It was imperative to address the riskiest members first, and action was taken to accelerate coaching for the 155 members in emerging and intervenable high-risk categories. The coaches were given direction to pay particular attention to the 5 members exhibiting 6 (and  more) ER visits.

One of the prime goals of the coaching intervention was to address the severe gaps in care (especially preventive services), for the hypertensives, diabetics, and those with blood disorders.  The company also stepped incentives for biometric screening in order to filter pre-diabetic members with the goal of reaching them before they lapse into full condition.

The client has also implemented a more traditional disease management programs around diabetes  and hyperlipidemia specifically.

Projected Results

For members that were at a normal risk level, the average amount paid per member was $1,381 and there were 1,824 members in this category. For members in the emerging and intervenable high-risk categories, the average cost per member was $5,135 and $5,643 respectively and there were 200 and 155 members in these categories. If we were to engage these members with the right interventions, we are looking at a potential saving of at least $590,000.

 

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