understanding member behavior to maximize health outcomes

Understanding+Member+Behavior+to+Maximize+Health+Outcomes

Omid%B.%Toloui,%MPH%Senior'Director,'Product'Management'

“Positive+changes+in+individual+behavior+can+reduce+the+rates+of+chronic+disease+in+this+

country.”++!

0%The%Government…and%Most%Researchers

Source:%HealthyPeople.gov

“Positive+changes+in+individual+behavior+can+reduce+the+rates+of+and$improve$the$

management$of+chronic+disease+in+this+country.”++

!0%Me,%Altegra%Health…and%Most%Researchers

• US%Healthcare%Costs%Approaching%$3+Trillion%Annually

Source:'Osterberg'L,'Blaschke'T.'Adherence'to'medication.'N'Engl2

J'Med.'2005;353:487J97'&'McKinsey'&'Co,'2012

• How%much%of%that%is%contributed%to%member+behavior?%• 31%+of+total+costs%directly%contributed%to%behaviorally%influenced%chronic%conditions%

• All%in,%69%+of+total+costs%were%heavily%influenced%by%member%behaviors%

• Poor%medication%adherence%alone%accounts%for%+$100B+in+avoidable%spending.

UpsideIDown+Cost+Pyramid

7

“Everyone mouths the words, ‘One percent of the population spends 30 percent of the money, 5 percent spends 50 percent.’ But operating models and financing plans ignore this fact,” says Charlie Baker, former CEO of Harvard Pilgrim Health, now with venture capital firm General Catalyst.

Taking a patient-first approach to the population at the top of the pyramid is the first step toward change. Below, we describe two healthcare providers focused on distinct populations that have overcome today’s barriers to improve outcomes and reduce costs. Both of these organizations have taken out low-value-add activities while improving the patient experience and clinical outcomes.

CAREMORE: Rebuilding healthcare for frail elderly patients

CareMore exclusively serves a Medicare Advantage population, focusing its resources on the 15 percent of its patient panel that generates 60 percent of its healthcare costs. These are the frail elderly who are at risk of falling and breaking a bone or diabetic patients facing a potential amputation.

Medicare Advantage and risk-adjusted global payments helped to make CareMore’s patient-first business design really work. Fee-for-service cannot easily fix the problems in the top two layers of the pyramid because providers have no incentive to streamline care or cut costs. By receiving an age- and health-adjusted payment for its full patient panel, CareMore can allocate resources to provide the most overall value. In one case, as we’ve seen, that translated to buying air conditioners for frail elders during a heat wave.

A health provider for frail elders reduces costs by heading

off hospitalizations

The upside-down pyramid (Today): Cost by clinical segment

COST BREAKDOWN

PATIENT POPULATIONS

5%

20%

75%

45%

35%

20%

ER visits, overutilization,high care variation,

noncompliance

Infections, complications,rehospitalizations

Polychronic

At-risk for major procedures(e.g. cardiology, oncology)

Healthy,minor health issues

IMPLEMENT+HIGH+IMPACT,+MEMBERIFOCUSED+INTERVENTIONS

HELP+MEMBERS+MAKE+THE+RIGHT+CHOICES+FOR+THEIR+HEALTH/CONDITION

HELP+MEMBERS+SEEK+AND+RECEIVE+APPROPRIATE+PREVENTIVE+CARE+TO+MANAGE+THEIR+HEALTH+CONDITIONS

UNDERSTAND+(LIMITED)+++IMPACT+MEMBER+BEHAVIOR+TO…

ADDED+VALUE

WE’RE+UP+AGAINST+A+FORMIDABLE+ENEMY:+BIOLOGICAL+BEHAVIOR

BUT+FIRST+SOME+EXPERIMENTS

�10

Start+with+30+rats,+7+or+8+in+each+of+4+groups.+Hypothesis:'Too'much'carbohydrates'or'fat'in'the'environment'may'be'life'threatening

CARB Protein Fat

CARB Protein Fat

CARB Protein Fat

CARB Protein Fat

CARB CARB CARB

Fat Fat Fat

Protein Protein Protein

+

+

+

All+Do+Well

Half+Die

Half+Die

All+Do+Well

Source:'Tordoff'MG,'2002.'Obesity'by'choice:'the'powerful'influence'of'nutrient'availability'on'nutrient'intake.'American'Journal'of'Physiology'–Regulatory,'Integra\ve'and'Compara\ve'Physiology'282,'1536J1539.'

�11

Repeat+the+experiment+with+the+22+survivors+to+see+what+and+how+much+they+will+eat+and+the+effect.

CARB Protein Fat

CARB Protein Fat

CARB Protein Fat

CARB CARB CARB

Fat Fat Fat

+

+

Eat+a+third+of+each+and+do+well.

Eat+more+carbohydrates.

Eat+more+fat.

Human+Correlation:+We’re+impacted+by+availability/convenience.+We’re+programmed+to+maximize.

�12

Marshmallow+ExperimentGiven%a%choice%between%a%small%reward%now%and%a%larger%reward%in%a%later,%people%typically%opt%for%the%small%reward.

Our%Maximizing%Biology%(consume%or%do%now%the%future%is%uncertain)%strongly%affects%our%decision0making%in%ways%that%affect%our%health.

Luckily,%we%have%a%rational%brain.

BUT+HOW+RATIONAL+ARE+WE?

FALSE.+IT’S+A+MYTH.

INDIVIDUALS+ACTUALLY+UNDERSTAND+THEIR+OWN+HEALTH+ISSUES+AND+ACT+RATIONALLY+TO+ADDRESS+THEM+

TRUE+or+FALSE?

�15

67Changing patient behavior: the next frontier in healthcare value

than reaching those who need help before they can take proactive steps to improve their health.

What does good design look like? With regard to behavior-change interventions, three inno-vations appear to be most important.

Behaviorally based segmentation should be XVHG�WR�GHHSHQ�LQVLJKWV�LQWR�VSHFL¿F�JURXSV� Current approaches to patient segmentation and predictive modeling tend to center on clinical conditions. However, change inter-ventions are more likely to be successful if they take into account additional factors, such DV�D�SHUVRQ¶V�EHKDYLRUDO�SUR¿OH�RU�PRWLYDWLRQ� to change. These insights enable more focused targeting of the groups of people for whom impact is most likely to be achieved. They also make it possible to design programs that more H̆HFWLYHO\�DGGUHVV�SUDFWLFDO�EDUULHUV�WR�FKDQJH��

design of most health-related products, services, and interventions remains remark- DEO\�XQD̆HFWHG�E\�WKHVH�GLVFRYHULHV�LQWR�KRZ� humans make decisions. For example, tradi-tional clinically driven interventions assume that individuals understand their own health issues and usually act rationally to address them; however, this is often far from the case. In a survey we recently conducted, 76 percent of the participants with high-risk clinical conditions described themselves as being in excellent, very good, or good health (Exhibit 2). 3URJUDPV�WKDW�IDLO�WR�DFFRXQW�IRU�WKLV�JDS�EH-tween individuals’ actual health status and how they understand and experience their health on a day-to-day basis (and thus how willing they are to change their behavior) miss the boat in terms of design. Often, these programs simply attract individuals who are already “activated” to change their behavior, rather

Exhibit 2 Most people think they are significantly healthier than they are

7

24

33

12

2829 43

57 31

26 41

34 42

66 27

Respondents’ self-assessment of their health status by different risk categories,1 %

1Based on derived health profile.

Source: McKinsey Retail Healthcare Consumer Survey

BMI >30

BMI <30

Chronic

High-risk

Low-risk

Excellent/very good Good Fair/poor

Health International #12 December 2012 — Patient Behavior

Exhibit 2 of 2

SINCE+IT’S+HARD+TO+CHANGE+OUR+BIOLOGICAL+(INSTINCTUAL)+BEHAVIOR,+WE+NEED+TO+THINK+ABOUT+

CHANGING+OUR+APPROACH.

BUT+WHAT+CAN+WE+IMPACT?

�17

Policy%Making

Social%Factors

Health%Services

Individual%Behavior

Biology%&%Genetics

DETERMINANTS+OF+HEALTH

Diabetes+is+the+leading+cause+of+adult+blindness,+amputations+and+kidney+failure.++

True+or+False?

False.+Poorly$controlled+diabetes+is+the+leading+cause+of+adult+blindness,+amputations+and+kidney+failure.+

Let’s+jump+back+to+the+focus+of+what+we’re+trying+to+impact+through+behavior+change:+Chronic+Conditions

OLD+• Reactive+System+

• Treat+Acute+Illnesses+After+the+Fact+

• Treatment+finite+in+duration

NEW+• Centered+on+patients+

• Prevention+• Ongoing+management+of+chronic+conditions+

• Treatment+indefinite+in+duration

Paradigm$Shift

Behavior+Change+Can+Succeed:

MemberICentric+Paradigm

PRINCIPLES

Increasing+Burden+of+Illness

�22

TAKE+A+HOLISTIC+APPROACH+TO+A+MEMBERS+NEEDS

Contributions+to+Health+Status

�24

Other+12%

Genekc+13%

Medical+Care+34%

Behavior+41%

Source:'Kaplan,'Sallis'&'Patterson,'1991'Health'and'Human'Behavior

ADDRESS+BARRIERS+TO+THE+DESIRED+BEHAVIOR+CHANGE

INTERVENTIONS+THAT+TARGET+MULTIPLE+DETERMINANTS+OF+HEALTH+ARE+MOST+LIKELY+TO+BE+

EFFECTIVE.

Communication

�27

Care%doesn’t%stop%when%members%leave%the%doctor’s%office.%Communication%becomes%a%lot%more%important.

FREQUENT+FEEDBACK+AND+COMMUNICATION+ENCOURAGES+BEHAVIOR+CHANGE+

++COMMUNICATION+MUST+BE+TWOIWAY++

!

RIGHT+MESSAGES+AT+THE+RIGHT+TIME+AND+FREQUENCY

ACTIVE+COMMUNICATION

PROVIDE+CLEAR+ADVICE+ON+THE+BEHAVIOR+TO+CHANGE+

EVOKE+SELFIEFFICACY+(YOU+CAN+DO+IT)+TO+ENHANCE+CONFIDENCE

MEMBERS+MUST+FEEL+THAT+THERE+IS+HOPE+AND+BENEFIT+IN+DOING+A+GOOD+JOB+

EXPRESS+EMPATHY+TO+MOBILIZE+CHANGE

BehaviorIBased+Segmentation

+Organized+&+Intelligent+Outreach++

%Create%behavioral%segments%by%stratifying%members%by%selected%predictors%%Match%or%provide%the%right%intervention%to%the%right%member

�33

Additional+Data,+Additional+Insight

+Incorporate+as+many+additional+behavioral+insights+when+stratifying+the+population+for+outreach++For+Example:+

+Demographic+Data++Government+Program+Eligibility++++Zipcode++Resource+Utilization++Receptivity+to+Various+Types+of+Communication++Inclusion+in+Other+Programs++Family+Structure+(Social+Isolation)

�34

UTILIZE+DIFFERENT+CHANNELS+OF+COMMUNICATION

ENSURE+COMMUNICATION+IS+PERSONALIZED

BEHAVIORALLY+BASED+INCENTIVES+CAN+BE+USED+TO+ENCOURAGE+CHANGE

According+to+research,+disease+management+programs+designed+under+the+new,+patientI

centered+paradigm+can+reduce+costs+by+3X+to+5X+more$than+traditional+disease+management+

programs.+!

This+is+in+addition+to+gains+in+productivity,+retention,+better+outcomes+and+quality+of+life.

Source:'McKinsey'&'Company,'2012

If+this+sounds+like+something+you+need…

Check$Out:$$!

+SMART+Connect++SMART+Appointment+Scheduling++COMMUNITY+Link

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THANK%YOU.%OMID.TOLOUI@ALTEGRA.COM%310.243.6643%