Dr. Peter Lazes, Director, Healthcare Transformation Project

Cornell University

Rutgers University 7th Annual Labor-Management Conference December 9, 2011

Important strategies for improving the health of members and reducing costs Innovative processes of Benefit and Taft-Hartley Funds 32BJ Health Fund

1199 NW, UFCW local 21, OPEIU Locals 8 & 23,

Painters District Council 5 (Seattle, WA.)

UNITE-HERE Locals 54, 165 & 226 (Atlantic City and Las Vegas)

1199SEIU

Im astounded by people who want to know the universe, when its hard enough to find your way around Chinatown

Woody Allen

AUSTRALIA CANADA GERMANY NEW

ZEALAND

UNITED

KINGDOM

UNITED

STATES

OVERALL RANKING

(2007) 3.5 5 2 3.5 1 6

Quality Care 4 6 2.5 2.5 1 5

Right Care 5 6 3 4 2 1

Safe Care 4 5 1 3 2 6

Coordinated Care 3 6 4 2 1 5

Patient-Centered

Care 3 6 2 1 4 5

Access 3 5 1 2 4 6

Efficiency 4 5 3 2 1 6

Equity 2 5 4 3 1 6

Long, Healthy, and

Productive Lives 1 3 2 4.5 4.5 6

Health Expenditures per

Capita, 2004 $2,876* $3,165 $3,005* $2,083 $2,546 $6,102

Country Rankings

1-2.66

2.67-

4.33

4.33-

6.0

Source: K. Davis, C. Schoen,

S. C. Schoenbaum, M. M.

Doty, A. L. Holmgren, J. L.

Kriss, and K. K. Shea, Mirror, Mirror on the Wall: An

International Update on the

Comparative Performance of

American Health Care, The Commonwealth Fund, May

2007

* 2003 data

Access to care for 33 million newly insured Americans and servicing still the uninsured

America spends twice as much on healthcare per capita than any other nation

75% of all health dollars are spent on chronic conditions, many of which are preventable

America ranks 37 out of 191 countries in

quality

Where are we going?

Integrated Care

Coordinated Care:

Patient centered care involving collaboration

among primary care physician, nurses, patient,

family and community

Information Technology:

Electronic Medical Records/History, E-Prescriptions,

Interactive Patient Web Portal

Health Coach, Nurse Navigator:

Staff use of electronic portals and tracking tools to monitor progress of patients, especially those

with chronic conditions

Reimbursement Reform:

Restructuring of the current system used to compensate physicians based on fee for service to one that is

bundled/pre-paid, and quality outcome linked

Tracking Outcome Tools:

Use data to identify issues of critical care

Feedback to Physicians and Healthcare Team

Measure clinical or service performance by

physician/practice

Fragmented Care Integrated Care

No care coordination among physician, staff, family and community

System reacts to needs

Fee for service reimbursement

Limited tools/processes for preventive care or patient progress

Patient centered coordinated care involving all parties in patients healthcare

Needs are anticipated Electronic/staff tools to

track patient progress and monitor chronic conditions

Bundled payments supports a system approach

Importance of improving

transitions in care, doctor to

doctor, and post-hospital

Follow-up care following

hospital discharge could

reduce re-hospitalization

High cost care management

could reduce errors and

lower costs

Will require restructuring

Medicare benefits and

incentives

Dollars

$9,618

$6,152

Source: M.D. Naylor, Making the Bridge from Hospital to Home, The Commonwealth Fund, Fall 2003.

Effect of Advanced Practice Nurse Care on Congestive Heart Failure Patients Average

Per Capita Expenditures

Labor unions and their employer partners jointly govern approximately 3,000 plans covering the lives of roughly 23 million American workers, dependents, and retirees.

Many of the Taft-Hartley Fund dont manage the care of patients nor reward members for healthy behavior.

Program Savings

Patient Centered Medical Homes $1,089 per enrollee (currently) Total of $1.7 million in 2012 (projected) Total of $4.4 million in 2015 (projected)

Cigna Chronic Care Management $1,6 million in 2012 $6.7 million in 2015

Case Management for High-cost Members $1.2 million annually

Centers for Excellence $9 million annually

Increase in ER Co-pay $2.5 million

Prescription Benefits Management $5.9 million in 2011 (currently) $7.7 million in 2012 (projected)

Reduced fraud, abuse, and claims processing errors

$11 million saved to date (currently) $2 million annually (projected)

Re-enrollment and Eligibility Confirmation $ 4.1 million in 2011 (currently) $ 4.9 million in 2012 (projected)

Integrated Benefits Administration System $ 1.3 million (starting in 2013)

New Office $ 12 million per year (starting in 2012)

Kaiser Health Plan Enrollees in D.C. Area

$ 1.6 million in 2012 (projected)

The fund Provides comprehensive benefits to 169,000 people.

In 2005 the fund cut costs by $88 million and maintained quality.

The funds most comprehensive family benefit plan currently costs employers $12,871.

The national average is $15,073 for comparable plans.

The fund is projected to save $80.3 million in 2012 and $120.5 million by 2015.

In 2009 a group of unions and Group Health developed an innovative health plan for the unionized employees at Group Health.

Created capitated payments to Group Health.

Initiated several wellness programs.

Group Health is an innovative cooperative which serves as an insurance company and provider.

It provides integrated care for members and intensive chronic care management of the chronically ill.

It utilizes advanced health information technology.

Lifestyle Activities Health Care Activities Targeted Activities

Exercise Health advising Receiving health coaching

Healthier eating Having a personal physician

Tobacco-cessation efforts

Wellness challenges Having all preventative care tests and exams up-to-date

Weight management

Community physical activity events

Annual dentist visits Living Well with Chronic Conditions Workshops

Engaging with wellness champions

Consulting the Group Health nurse service

Chronic illness planned care visits

Facility-specific wellness champion events

Using the employee assistance program (EAP)

Shared decision-making

Group Health walking meetings

A flu shot every fall

The stay-tobacco-free initiative

Union members enjoy the same benefits as regular Group Health patients.

A labor-management agreement created an

innovative point-based incentive system that allows members to pay lower premiums for engaging in healthy behavior.

Members earn points by registering on the

MyGroupHealth web portal, completing an online health profile each year, and by completing activities within three main categories: 1) lifestyle activities; 2) health care activities; and 3) targeted activities.

.

Program Associated Savings

Hospitalists and case management for hospitalized members.

The average cost of a hospital stay has dropped from $14,800 to $13,200.

Dr. Tomorrow program. A $1 million reduction in ER visit expenses.

Reducing the doctors on their panels focusing on quality care of care, costs, and unnecessary care and/or hospitalizations.

Spending on professional care has dropped from $91 million to $90 million.

Free pharmacy. Drug costs have increased but overall costs for the fund have decreased---Adherence 75% to 95%.

The Fund provides extremely effective chronic care management through its Special Care Center (SCC).

The SCC is what is known as an Ambulatory Intensive Caring Unit provides intensive and pro-active managed care for the most unhealthy and chronically ill members of a group.

The cost of patient care for the group using the SCC was rising at 25% per year prior to enrollment in the SCC is currently 4%.

The group saw a decrease of over 20% in emergency room visits

and hospitalizations.

When members were hospitalized, their length of stay was 8% shorter.

The average cost per stay was 15% less in comparison to a group

of non-enrollees.

SCC patients have shown improvements in cholesterol, blood glucose levels, and blood pressure.

Nearly half the smokers in the SCC quit smoking.

Initiative Components

Aggressive cost management and creative benefit design. -One network -Renegotiated fee schedules for preferred lab and radiology providers. -Durable medical equipment purchased through a preferred network. -Low administrative costs. -Continually update prescription programs and preferred drug lists. -Reduce unnecessary care. -A mail-order prescription program. -Medicare HMO for retirees. -Preferred lab and provider networks.

Health Coach Program -Assists current and potential diabetics, people with or at risk for heart disease, overweight members, and smokers.

Weight Loss - Members receive coaching, access to a registered dietitian, and other benefits.

Tobacco Cessation -Participants can access a health coach, support staff, print material, and product discount.

Wellness Programs -24/7 Nurse Helpline. -Walking groups and weight loss competitions. -Monetary incentive program created by labor-management wellness committee.

The Health Fund manages approximately $1 billion and provides care for 500,000 people.

It has seen a net average cost increase of 4.5 percent over the past three years.

The national trend has increased by over 7 percent per year.

It costs $13,628 to cover a family of four in the fund. On average it cost $21,477 to cover a family of four

in New York City in 2010. The fund is currently projected to have annualized

savings of $46 million by 2015. The fund is achieving annual savings of over $200

million per year when one accounts for all efficiency initiatives in recent years.

Chronic care management and high flyers

Prescription drug programs

Integrated care

Wellness and member self-management

Trustees to get smart about best practices for improving the health of their members

Join a comprehensive plan that is already integrated

Develop various programs from prescription drug

to chronic management

Create or affiliate with Special Care Centers or Patient-Centered Medical Homes

Leverage your fund to incentivize providers to invest in creating an integrated delivery system