The importance of aligning incentives cannot be overstated: for health status to improve all of the stakeholders must be focused on producing a healthier person or persons, which is an investment strategy. But no rational investor just places money down; he or she analyzes the prospects, quantifies the risk, and invests where the best economic opportunities are. The goal, then, is to find that harmony, and it is best found in engagement and accountability that produce healthier people, healthier organizations, and healthier communities. This is accomplished through an Outcomes-Based Contract. Read more from author Cyndy Nayer, and learn how the Outcomes-Based Contractingtm Framework will propel clinical, financial and performance rewards: the health, wealth, performance goals of people, organizations and communities…
Wisconsin–the state best identified with cheese, high taxes, the Green Bay Packers and beer–is also known for health care, creating diverse collaborative health care systems and well-established prevention programs. But it is also plagued by high costs and expenses. Despite Wisconsin’s health care woes–it ranked as the 16th state with the highest health spending per capita in 2004 (the most recent year for which comparative state-level data are available), it is a state primed for reform, a path it has been pursuing throughout the past decade. Employers, health plans and county governments all share in the journey towards cost-effective, high-quality, accessible health care.
This report, Wisconsin: Levers Drive Value-Based Innovation Across the State, makes a business case for value-based design as illustrated by Wisconsin companies Quad/Graphics [QuadMed], Humana, Journal Communications and Chippewa County. The four organizations are a representative sample of how innovation is providing resolution and relief in Wisconsin and how the state culture has contributed to the success of their solutions. The report is built on the Health Value Continuum, a development pathway for value-based design that shows the route to quality health improvement and behavior change. The Health Value Continuum was developed by the Center for Health Value Innovation to detail the experiences and path of early innovators in value-based benefit design. The four organizations highlighted in this paper (QuadMed, Humana, Journal Communications and Chippewa County, WI) have each reached different points along the Continuum as they move toward optimal health.
“We think Wisconsin is a truly unique learning laboratory,” says Cyndy Nayer, president and chief executive officer of the Center for Health Value Innovation. “Wisconsin has demonstrated a willingness to innovate, share, and do more. We want to learn about and share the experience of these Wisconsin companies by cataloguing the levers–or incentives–currently in place, the metrics used to measure outcomes, and how statewide efforts can be replicated in the marketplace. These companies are all members of the Center, and our mission is to provide evidence of improved health value so that other companies can improve the value of their health care spend.”
The questions that every employer and plan sponsor, every health plan and benefits manager should be asking must reframe the question: How much health, instead of health care, are we buying? How much could we buy with the same money we are spending now, if we purchased services more wisely?
Understanding that things had to change if employers were to be able to continue to afford health care, a few forward thinking payers and influencers began to rethink their health care strategies. Two health care pilots began to take hold. One involved refocusing employees on the virtues of health and wellness. The other focused on decreasing the financial barriers to some of the care that would actually put healthier people back to work because they were compliant with their treatments.
These experiments that utilized reductions in co-pays for some populations continued to broaden with the inclusion of incentives for participation in annual or baseline health risk assessments, health fairs, and disease management. So began the development of behavior change through incentives that actively engage consumers to participate in their health and healthcare. The use of these incentives have evolved into the levers of population change that form the core of value-based design initiatives.
Learning Objectives:
Understand the nature of value-based design and the challenges it is designed to resolve.
Be conversant with the 4 Ds of value-based design . . data, design, delivery and dividends.
Know why health promotion is a foundational element of value-based design.
Learn the key skills and competencies that health promotion practitioners bring to successful implementation of value-based design.
Industry Ally to the Center, SeeChange Health has launched the first insurance company built on prevention-wellness and value-based designs. As an Industry Ally, SeeChange Health used the expert guidance and evidence from the Center in crafting their new product, now officially launched in California. Cyndy Nayer, President and CEO of the Center for Health Value Innovation, notes, ” It’s the alignment of incentives to engage consumers with the reimbursement strategy to engage the providers in keeping people well–the very embodiment of outcomes-based contracting–that is so unique. Sustainable behavior change that supports improved health is the goal. Bravo, SeeChange Health and HealthInsight for changing the direction of consumer health improvement.”
SeeChange Health – TheNew Value-Based Health Insurer Aligns Benefits with Preventive Care and Chronic Condition Management
San Francisco, CA–March 22, 2010 – SeeChange Health today launched the first new value-based health insurance company in California, offering personalized, value-based health plans that provide incentives to encourage individuals to play an active role in their health management and improve their quality of life. As the first value-based health insurance company to launch in the United States, SeeChange Health brings affordable, next-generation insurance designs to the employer group market. The plan will be available initially in Fresno, California, but the company plans to expand their offering to Los Angeles, San Diego, Bakersfield, Monterey, Sacramento and San Francisco in the coming months.
Value-based health care encourages individuals to access preventive care, which will identify looming health problems before they become serious – and expensive. Participants who complete a health questionnaire along with age and gender specific preventive examinations, including cancer screenings and basic lab tests, are rewarded with enhanced benefits such as reduced coinsurance and deductibles along with cash rewards.
Unlike typical health insurance companies, SeeChange Health designed its benefit plans to encourage individuals to see their doctor. SeeChange Health covers preventive examinations, including cancer screenings and associated lab tests, at 100 percent.
“We are thrilled to partner with a health plan that rewards its members for building and maintaining a relationship with their doctor,” said Dr. Daniel Bluestone, Chief Medical Officer of Santé Community Physicians. “SeeChange Health promotes healthy behaviors, which will ultimately reduce chronic illnesses and help people live fuller, healthier lives.”
In addition to providing enhanced benefits for completing preventive examinations and related screenings, SeeChange rewards its members with financial incentives for completing health actions necessary for proactively managing chronic conditions, such as diabetes, asthma and coronary artery disease.
“When SeeChange approached us with its groundbreaking solution, we eagerly embraced the only health plan to completely align its benefits with preventive care and chronic condition management,” said Cyndy Nayer, President of the Center for Health Value Innovation, the nation’s premier information exchange for value-based design.
“The reaction and feedback we are receiving from employers is overwhelmingly positive,” said Chuck Trogdon, CEO of Renberg, Trogdon, & Cavale Insurance Services. “Employers are clamoring for affordable health plans with benefits designed to support individual efforts for staying healthy. This approach drives down health plan costs and promotes a healthier workforce.”
Why the initial focus on California?One out of seven residents are uninsured and the number is growing. In the coming months, SeeChange will expand their health insurance offerings throughout California and into twenty-four states where they are licensed to sell value-based health insurance.
“While the nation debates the merits of a national health care plan, the elephant in the room is who is going to pay for it,” said Martin Watson, CEO of SeeChange Health. “With our new plan, we are effectively showing that you can lower health care costs and improve the quality of care while you’re doing it.”
About SeeChange Health
SeeChange Health provides fully-insured, value-based health insurance to employer groups. The company combines value-based benefit designs, data analytics and an interactive personal health record to consistently improve the health profile of individuals. Preventive health actions are assigned and tracked at an individual level. Individuals with disease states such as pre-diabetes, diabetes, asthma and heart disease receive specific health actions based on their medical condition. SeeChange Health is headquartered in San Francisco and is focused on reducing health care costs through proactive health management and early detection of health conditions.
SeeChange Health – TheNew Value-Based Health Insurer Aligns Benefits with Preventive Care and Chronic Condition Management
San Francisco, CA–March 22, 2010 – SeeChange Health today launched the first new value-based health insurance company in California, offering personalized, value-based health plans that provide incentives to encourage individuals to play an active role in their health management and improve their quality of life. As the first value-based health insurance company to launch in the United States, SeeChange Health brings affordable, next-generation insurance designs to the employer group market. The plan will be available initially in Fresno, California, but the company plans to expand their offering to Los Angeles, San Diego, Bakersfield, Monterey, Sacramento and San Francisco in the coming months.
Value-based health care encourages individuals to access preventive care, which will identify looming health problems before they become serious – and expensive. Participants who complete a health questionnaire along with age and gender specific preventive examinations, including cancer screenings and basic lab tests, are rewarded with enhanced benefits such as reduced coinsurance and deductibles along with cash rewards.
Unlike typical health insurance companies, SeeChange Health designed its benefit plans to encourage individuals to see their doctor. SeeChange Health covers preventive examinations, including cancer screenings and associated lab tests, at 100 percent.
“We are thrilled to partner with a health plan that rewards its members for building and maintaining a relationship with their doctor,” said Dr. Daniel Bluestone, Chief Medical Officer of Santé Community Physicians. “SeeChange Health promotes healthy behaviors, which will ultimately reduce chronic illnesses and help people live fuller, healthier lives.”
In addition to providing enhanced benefits for completing preventive examinations and related screenings, SeeChange rewards its members with financial incentives for completing health actions necessary for proactively managing chronic conditions, such as diabetes, asthma and coronary artery disease.
“When SeeChange approached us with its groundbreaking solution, we eagerly embraced the only health plan to completely align its benefits with preventive care and chronic condition management,” said Cyndy Nayer, President of the Center for Health Value Innovation, the nation’s premier information exchange for value-based design.
“The reaction and feedback we are receiving from employers is overwhelmingly positive,” said Chuck Trogdon, CEO of Renberg, Trogdon, & Cavale Insurance Services. “Employers are clamoring for affordable health plans with benefits designed to support individual efforts for staying healthy. This approach drives down health plan costs and promotes a healthier workforce.”
Why the initial focus on California?One out of seven residents are uninsured and the number is growing. In the coming months, SeeChange will expand their health insurance offerings throughout California and into twenty-four states where they are licensed to sell value-based health insurance.
“While the nation debates the merits of a national health care plan, the elephant in the room is who is going to pay for it,” said Martin Watson, CEO of SeeChange Health. “With our new plan, we are effectively showing that you can lower health care costs and improve the quality of care while you’re doing it.”
About SeeChange Health
SeeChange Health provides fully-insured, value-based health insurance to employer groups. The company combines value-based benefit designs, data analytics and an interactive personal health record to consistently improve the health profile of individuals. Preventive health actions are assigned and tracked at an individual level. Individuals with disease states such as pre-diabetes, diabetes, asthma and heart disease receive specific health actions based on their medical condition. SeeChange Health is headquartered in San Francisco and is focused on reducing health care costs through proactive health management and early detection of health conditions.
Building on their consistent theme of value-based benefit designs linked to meaningful behavior change, Cyndy Nayer and Jack Mahoney, M.D. have released evidence documenting the link from Value-Based Design to behavioral health. Adherence is the sustainable goal when designers fully comprehend that co-pay reduction alone will not support long-term change. ”Co-pay reduction is an engagement tool, but we’ve documented evidence for many years that the goal of sustainable adherence to improved health is the systematic application of the levers of prevention and wellness, chronic care management, and care delivery. The incentives must align in order for sustainable change to occur; barriers must be removed and reimbursement must be aligned in order to remove the friction that causes interruption in management,” say the authors and co-founders of the Center for Health Value Innovation.
As the country approaches the end of a year of promised reform that would deliver more health care, bend the trend on costs, and get more uninsured people into the system, weariness and wariness have taken root. The focus has moved from “bending the trend” to insurance reform, but the plan sponsors—most often employers of many sizes and sectors—have a job to do, and they need health and productive employees to do it.
Value-Based Designs Deliver Dividends—But Overcoming Non-Adherence Is Key
Adherence indicators may well be part of the “holy grail” for beneconomic outcomes. Using a suite of levers, defined as insurance design, incentives and disincentives, the benefits and compensation decision-maker has the power to influence behavior change for desired results. But the arbitrary implementation of iconic models of value-based designs, using these levers to remove cost and access barriers for certain populations, is not without consequences. Value-based designs do work, influencing patient and consumer behaviors in prevention/wellness, chronic care management, and choice of care delivery.
