ValueBased Benefit Design

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Value-Based Benefit Design
A Qualitative Benchmarking Study
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Study Introduction

• This project was designed to understand efforts
  that employers are making to create positive
  outcomes for diabetic employees. The primary
  focus of this survey is Value-Based Benefit
  Design (VBBD) with an emphasis on diabetes.
  Goals of the study included
• Understanding best practices around Value-Based
  Benefit Design
• Identifying the direction employers see benefit
  design heading
• Identifying barriers in implementing VBBD

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• INVESTIGATORS
• Carolyn Pare Buyers Health Care Action Group
• Linda Davis Buyers Health Care Action Group
• Paul Meade Clear Point Health
• Lisa Smith Clear Point Health
• Chris Cook GlaxoSmithKline
• Steven Burch GlaxoSmithKline

This study was funded by GlaxoSmithKline
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Methodology
Surveys and interviews covered the following
topics

• Value-Based Benefit Design
• Diabetes Specific Design Aspects
• Practices Beyond Benefit Design
• Impact of Benefit Features
• Future of Value-Based Design
• Overall Employee Demographics

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Methodology
Clear Point Health took a two-pronged approach to
researching Value-Based Benefit Design.
Surveys
Interviews

• 19 employers completed the online survey
• 13 in Minnesota
• 6 in other states

• 13 survey respondents agreed to follow-up phone
  interviews
• 10 in Minnesota
• 3 in other states

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Participants
The following companies participated in this
research. All listed companies completed the
survey and those marked with an asterisk also
participated in interviews.

• 3M
• Ameriprise Financial
• Cargill
• Carlson
• City of Springfield, OR
• GK Services
• General Mills
• Group Insurance Commission Massachusetts
• Hawaiian Electric Company
• Intel
• Land OLakes
• Marriott International
• Nike
• Rosemount Inc.
• Securian Financial Group
• State of Minnesota
• U.S. Bancorp
• Visant Corporation
• Wells Fargo

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Value-Based Health Management Definition

• Value Based Health Management is defined as the
  planning, design, implementation, administration
  and evaluation of health management practices
  that are grounded in evidenced-based guidelines
  throughout the healthcare continuum.
• Within the VBHM model, initiatives primarily
  focus on innovative practices that demonstrate
  the greatest total value through value-based
  benefit design, primary prevention, risk
  reduction, and chronic disease management.

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Key Findings
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Key Findings

• Many of the interviewed companies (61) have made
  major changes in their healthcare benefits in the
  recent past.
• Most common changes are introduction of
  consumer-driven plans, provider tiers, and new
  disease management modules.
• Cost is the No. 1 factor in both health plan
  selection and benefit design.
• Most surveyed companies consider disease profile
  of their population as an important factor in
  benefit design.
• Disease profile influences selection of disease
  management offerings and Value-Based Benefit
  Design aspects.
• Several interviewed companies are using
  aggregated data from employee Health Risk
  Assessments to inform benefit design.

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Key Findings, cont.

• Nearly half of surveyed companies do not offer a
  high-deductible health plan. Of those that do,
  most had 30 or less of their employees enrolled
  in a high-deductible plan.
• Smoking cessation (58) and online tools (58)
  are the most commonly offered diabetes programs.
• Nearly half of interviewed companies are
  considering launching or are launching Personal
  Health Records.
• Forward-looking companies are creating
  integrated, branded wellness efforts for their
  employees.
• Measuring the impact/ROI of benefit design
  changes and wellness efforts presents a challenge
  for many companies.
• Most surveyed companies (84) anticipate their
  organization will move more toward Value-Based
  Benefit Design in the future.

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Background
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Demographic Summary
Survey respondents represented a wide range of
worker demographics.
(N15-18)
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Participant Breakdown
How many other sites do you have outside of the
main corporate office location?
How many employees does your company have?
of Surveyed Companies
of Surveyed Companies
(N19)
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Value-Based Benefit Design
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Benefit Changes
Many of the interviewed companies (61) have made
major changes in their healthcare benefits in the
recent past. All the changes were company-led
decisions.
(N13)
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Factors in Benefit Design
Please rate the importance of the following
factors in your benefit design.
NotImportant
VeryImportant
Important
(N19)
Average Response
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Influence of Disease Profile
We looked at claims analysis and compared it to
market data. We saw where the main issues were.
The Health Assessments also showed where the main
issues are. All the sources agreed. - Benefits
Manager
Disease Management Programs
Value-Based Benefit Design Choices
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Senior Management Support
How supportive would you say senior management is
of the concept of Value-Based Health Management?
Average 4
1
5
Not at all supportive
Very Supportive
(N19)
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Benefit Design Strategy
Do you consider incentives to do any of the
following in your benefit design strategy?
(Please select all that apply)
of Surveyed Companies
(N19)
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Financial Incentives for Employees
Do you offer any financial incentives for
employees to do any of the following? (Please
select all that apply.)
Other Access preventive health/use benefits
wisely (i.e. generics, emergency room, etc.)
of Surveyed Companies
(N19)
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High Deductible Plan
What percentage of your employees are in a high
deductible plan?

• Uptake is an issue with high deductible plans for
  many companies
• Communication is a barrier to greater uptake
• Some interviewed companies said they expect to
  see an increase in participation in the future
• In one case, high levels of enrollment comes from
  employer using high deductible premium as the
  baseline for employer contribution

of Surveyed Companies
(N19)
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Disease Specific Services
Do you offer specific services or programs for
any of the following conditions? (Most frequent
responses shown below.)
of Surveyed Companies
(N19)
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Interviews CAD Depression

• Most interviewed respondents (85) said their
  companies have disease management programs for
  CAD in place.
• More than half of the interviewed respondents
  (61) currently have some type of depression
  program in place for all or most of their
  employees.
• Of those that do not have depression programs,
  many are considering adding them in the future.
  
• Two of the companies interviewed in Minnesota
  are considering participation in the Diamond
  Initiative aimed at systemizing care
  management for patients with depression in
  primary care medical groups.

(N13)
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Diabetes Specific Design Aspects
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Most Common Diabetes Programs
Do you have any specific programs for managing
people with diabetes? (please check all that
apply)
of Surveyed Companies
(N19)
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Less Common Diabetes Programs
Do you have any specific programs for managing
people with diabetes? (please check all that
apply)
Other Pharmacy consultations, onsite physician
visits and labs in MN.
of Surveyed Companies
(N19)
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Diabetes Programming

• All interviewed companies had some element of
  diabetes disease management activities.
• Many of these programs are relatively new with
  few more than three years old making longer
  term measurement more difficult.
• Companies struggle with defining ROI for these
  programs and rely on data supplied by the
  health plans.
• Programs that integrate some of the less common
  features labs without co-pays, co-pay waivers
  for drugs, etc. typically were launched more
  recently.

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Personal Health Records

• Examples
• Company 1 Plans to put PHR in place and have
  considered having information from the Health
  Assessment integrated into the PHR
• Company 2 Partnered to create own version of
  PHR. Had an extensive pilot in 2007 to ensure it
  would work with all care systems in the metro
  area. Plan to roll out first phase for all
  employees in 2008.

No PHR, not under consideration
To launch in 2008
Considering PHR
of Interviewed Companies
(N13)
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Beyond Benefit Design
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Culture of Wellness
Many interviewed companies (46) indicated they
are looking to create a culture of wellness among
employees.
We are formalizing our wellness program. There
was a corporate effort, but we now branded a
theme, have collateral and rolled it out to the
whole company.
(N13)
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Encouraging Wellness
Beyond the benefit plan design and specific
healthcare offerings, are there things your
company does to encourage wellness? (Please
select all that apply.)
Other Noontime seminars, internal wellness
website, health club discount, on-site locker
room, fitness classes
of Surveyed Companies
(N19)
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Impact of Benefit Features
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Measuring Impact of Benefits
How do you measure the implications of these
programs? (please select all that apply)
Other Claims data, Health Assessment aggregate
results and completion of behavior change program.
of Surveyed Companies
(N19)
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Measuring Success

• Healthcare costs are the key driver in
  considering the success of benefit design.
• Only a few companies are looking at sick days,
  but more are considering this as a future measure
  of success.
• Companies are likely to consider participation
  levels in Disease Management as a measure of
  program success.
• Some companies are looking at ways to track
  changes in Health Assessments and/or claims
  data.

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Results of Benefit Changes
If you have changed your benefits in the past two
years, has the implementation of benefit changes
Reduced healthcare costs or reduced the rate of
increase for these costs?
Improved productivity?
of Surveyed Companies
of Surveyed Companies
(N19)
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Barriers to Value-Based Benefit Design
Are any of the following barriers to moving
toward Value-Based Design in your company? (Most
frequent responses shown below.)
of Surveyed Companies
(N19)
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Value-Based Cycle
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Value-Based Cycle
Step 1 Assess Employee Health Profile

• Basic
• Understand how number of employees with diabetes
  compares to national averages
• Advanced
• Analyze aggregated claims data
• Encourage employees to complete health
  assessments
• Use aggregated health assessment data to profile
  disease prevalence, severity, etc.

1
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Value-Based Cycle
Step 2 Adjust Offerings to Reflect Employee Needs

• Basic
• Implement diabetes disease management program and
  some online tools
• Advanced
• Implement more advanced diabetes disease
  management program elements
• Build senior management support for expanded
  Value-Based Benefit offerings
• Waive co-pays for diabetes-related labs and drugs
  that treat diabetes

2
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Value-Based Cycle
Step 3 Encourage Patient Participation in
Self-Management

• Basic
• Offer wellness-related services, including health
  education, exercise programs, changes in
  cafeteria offerings, etc.
• Use generic disease management messaging to
  patient
• Advanced
• Formally brand wellness programs and create a
  communication strategy
• Use the Web to encourage wellness and create
  social networking for wellness
• Create incentives for maintaining optimum self
  care
• Implement Personal Health Records (PHR)
• Personalize disease management messaging to
  patient

3
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Value-Based Cycle
Step 4 Measure Success of Efforts

• Basic
• Track effect of changes on health care costs
• Track participation levels and employee
  satisfaction with program offerings
• Advanced
• Integrate aspects of healthcare delivery to
  facilitate data transfer
• Track individual patient treatment goal
  obtainment
• Seek improvement trends in health assessment data
• Determine health outcomes/ROI measures on data
  collected

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Limitations

• Selection bias
• Employers selected by BHCAG
• Self-selection bias (interview participation)
• Observation bias
• Recall bias
• Interviewer bias (minimized by single
  interviewer)
• Generalizibility
• Limited based on most employers located in
  Minnesota

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Summary

• Most companies have made benefit design changes
  in the recent past and plan to move further
  toward value-based health management in the
  future.
• Many companies consider the disease profile of
  their employees for benefit decisions and disease
  management programs.
• Companies are seeking to create a culture that
  promotes overall wellness for their employees.
• Most companies rely on Disease Management
  programs to address the management of chronic
  conditions among their employees.
• Defining ROI is a key challenge for companies
  instituting value-based design plans.

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About Clear Point Health
Clear Point Health is a strategy development and
operations consulting firm, specializing in
serving the health care industry. We are
dedicated to helping clients find solutions to
their most pressing strategic and operational
business challenges allowing companies to take
information and move from insight to action.
This report focuses on Diabetes and Value-Based
Benefit Design. If you would like to know more
about sponsoring a research project, conducting a
gap analysis or other consulting services we
offer, please contact Paul Meade President Clear
Point Health 762 Airport Road, No. 211 Chapel
Hill, NC 27514 [phone] pmeade_at_clearpoint-he
alth.com www.clearpoint-health.com
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