Outcomes-Based Contracting^tm: The Value-Based Framework for Optimal Accountability

ST. LOUIS, Mo. – August, 2010 – Twenty-one of the nation’s leading health benefits executives who are committed to improving engagement and accountability in health management have been named Fellows of The Center for Health Value Innovation.  As the nation’s premier benefits leadership exchange, Center Fellows will accelerate the adoption of innovation that supports the five C’s of sustainable behavior change: commitment, concern, cost, communication, community.

“This honorable title of Fellow goes to a rarified group of individuals who have not only implemented value-based design in their own organizations, but have also demonstrated alignment of incentives, propelling the work of the Center,” says Cyndy Nayer, president and CEO of the Center.

The Center is developing the largest database of value-based levers—incentives, insurance plan designs, and services that companies use to improve the health value of investments in their workforce.  Through interviews, surveys, and collaborative intelligence of Center members, the acceleration of adoption shows that value-based benefit designs (VBD) are a significant part of health and performance investing.

“If value is measured by outcomes, then purchasing must embrace outcomes–based contracting, measured by clinical, financial and performance determinants,” adds Nayer.  “Our Fellows advance the goal of linking health value to accountability for outcomes in our communities.”

The Center recently announced the results of its survey, “Value-Based Design 2009,” for which they engaged  Buck Consultants, a global employee benefits and human resources consulting firm, confirming that employers believe VBD improves employee health and productivity.

“The next Buck survey, detailing the changes anticipated in health reform, begins this fall,” says Nayer.  She also points to the Center’s increased focus on employee engagement, system alignment, and economic predictability, which ties in with its goal to expand the definition of VBD and link accountability to health and performance.

Michael Taylor MD, Medical Director, Health Promotion, Caterpillar and Chairman of the Center’s Board, concurs, “These leaders demonstrate a variety of value-based designs with replicable examples of improved health outcomes.”

2010 Fellows include:

• Jan Berger, MD, MJ, President, Health Intelligence Partners, LLC
• Wayne Burton, MD, Chief Medical Officer, American Express Company
• Joycelyn Elders, MD, Former U.S. Surgeon General, Special Advisor, Government Relations
• Paul Grundy, MD, Director of Healthcare Transformation, IBM Global Well Being Services and Health Benefits, IBM
• Robert Holben, Former Director of Compensation and Benefits, Gulfstream Aerospace Corporation
• Dave Johnson, MD, MBA, CPE, President, Vivacity, Associate Medical Director, Premera Blue Cross
• Alison Kocanda, Manager, Medical Education, Medical & Scientific Affairs Takeda Pharmaceuticals North America, Inc.
• Robert Krtizler, MD, Deputy Chief Medical Officer, Johns Hopkins HealthCare, LLC, Vice President of Communications, Center for Health Value Innovation
• Cheryl Larson, Director of Membership and Education, Midwest Business Group on Health
• Donna Marshall, Executive Director, Colorado Business Group on Health
• Clare Miller, Director, American Psychiatric Association
• Kavita Nair, RPh, Ph.D., Associate Professor, University of Colorado Health Sciences Center, Vice President of Government, Finance and Ethics, Treasurer, Center for Health Value Innovation
• Kevin O’Brien, Chief Executive Officer, Partners in Care
• Laurel Pickering, Executive Director, New York Business Group on Health
• Richard Popiel, MD, Vice President and Chief Medical Officer, Horizon BCBS of New Jersey
• Robert Scully, MD, Chief Medical Director, Health Alliance Medical Plans
• Scott Smith, Director Business Coalitions & Alliance Development, GlaxoSmithKline
• Michael Sokol, MD, Corporate Medical Director, Merck and Co., Inc.
• Brian Sweet, RPh, Chief Pharmacy Officer, WellPoint, Inc.
• Jerry Vuocolo, Director, Healthcare System Strategy, Merck and Co., Inc.
• Fred Williams, Director of Health Benefits Management, Quest Diagnostics Inc., Director of Community Health Innovation, Center for Health Value Innovation
• Jerry Reeves, MD, Vice President of Medical Affairs, Health Insight of Nevada, Principal, Health Innovations, LLC

About The Center for Health Value Innovation

Information Exchange for Value-Based Design

The Center for Health Value Innovation has grown into the nation’s premier organization dedicated to sharing the evidence of improved health and economic outcomes through improved health engagement and accountability.  www.vbhealth.org

###

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.”

For the complete report in PDF format, please click here.

Our mission is to share the innovations that drive the value of every dollar invested in health.

Our goal is to identify and link innovators and innovation that broaden the boundaries of health value.

Our work is focused on defining value, creating relevance to shareholders and stakeholders, and improving the health and economic viability of communities.

Operating Principles:

We will define value as the improvement in health and economic status at the consumer, organization, and community level.

We will encourage innovation and innovators who improve health through alignment of quality and outcomes across the health value chain.

We will share findings of success and opportunity with the communities we serve.

We will attract best practices and align incentives to drive the value of health across stakeholders.

We will respect confidentiality and proprietary process when promoting new ideas, innovations, and innovators, including the work of our Center and its members.

We will honor boundary-less thinking in our safe, virtual concept studio so that we can, together, improve health outcomes across America.

Membership in the Center for Health Value Innovation is earned through a willingness to share ideas, concepts, trends, and experiences so that innovation is fostered and health value is increased.  Your membership is a valuable asset to your business.  At all levels of membership, you can:

ACCESS collaborative connections to innovators in value-based health design: Learn what they do, what they have learned, and how to make value-based design changes at your worksite

PARTICIPATE in semi-annual webinars

LINK to experts in value-based health strategies that provide additional information and resources to improve your company’s financial sustainability

ACQUIRE tools for qualifying your organizations’ readiness for introducing value-based health innovations – whether you are new to the concept or a veteran innovator.

LEARN the latest news about value-based health innovations in your area and across the country via the Center for Health Value Innovation’s web site and email news bulletins.

E-mail us at info@vbhealth.org

The Center for Health Value Innovation will be the trusted resource to demonstrate how engagement in health can improve accountability and economic performance.

What We Do:

We demonstrate that achievement of superior health outcomes is a result of engagement and accountability.

What We Value:

• Information that translates into action
• Transparency of our organization to its constituencies
• Trust and respect among organization members
• The collective wisdom of experienced leaders

What We believe:

• That a culture focused on health is more valuable than one focused on health care
• There are many valid approaches to achieving superior health outcomes
• In access to effective health care
• In the capability of individuals to manage their own health

• Our goal is to identify and link innovators and innovation that broaden the boundaries of health value.
• Our work is focused on defining value, creating relevance to shareholders and stakeholders, and improving the health and economic viability of communities.

We are a collaborative community of stakeholders, led by employers of all sizes and sectors, who are improving health status while reducing total cost trends using value-based designs. We learn and share as a community of thought leaders, as a knowledge resource, and as innovators for new trends.

Our latest finding: There are more than 100 levers that influence consumer and patient behaviors in value-based design according to our interviews and surveys. How they are used and the results they bring are part of our shared journey. The 15 macro-levers are published in our book, Leveraging Health – Improve Health Status And Bend The Trend On Financial Inflation With Value-Based Designs, which you can order through our website by clicking on the book icon.

It’s important to note that value-based designs (VBD) are much more than waived or reduced co-pays for chronic care, particularly medications.  A value-based design uses evidence-based clinical impact merged with financial impact (health + economics) to guide the behaviors of populations in managing their health.  Value-based design can influence choice of care provider, appropriate and persistent treatment, and early risk/prevention/wellness.  All of these have been documented to show a meaningful impact in health status, productivity (safety, disability, unscheduled absences, and more), quality and financial cost trend.

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.

Cyndy Nayer and John Riedel, Leveraging Health: A Primer for Health Promotion Practitioners using Value-Based Designs from Michaela Conley, HPCareer.Net on Vimeo.  Learn more about HPCareer.net here!

SeeChange Health – The New 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.

###

PRSeeChangeLaunchMarch22-2010

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.

Read more.  Nayer, Mahoney J Comp Ben Behavior Change and VBBD JCBv26#1 copyright

“Reprinted from Journal of Compensation and Benefits. Copyright © 2010 Thomson Reuters/West.

For more information about this publication please visit www.west.thomson.com

Read more of the primer by clicking here.

AHP HPP primer 3.2010

Read more here  HPM-VBD Seminar