Happy D-Blog Day + Disease Management 2.0

First, let me acknowledge the fact that today is D-Blog Day. In essence, it's a day dedicated to a vibrant diabetes blogging community which has organically grown to include several hundred individuals, and continues to grow. If you're interested, you can start your own blog, or just comment on some of the many posts out there. OK, with that addressed, now for my regular post.

Disease Management 2.0

I was on the plane headed to the Diabetes 2.0 Conference at the Diabetes Research Institute on Thursday (I'll be covering that in more detail soon), and picked up a copy of last week's edition (November 2, 2009) of BusinessWeek (the one with the cover on smartphone apps) while I was at the airport.

As I was flipping through the magazine on the plane, I stumbled upon on interesting article entitled "Tough Love, Lower Health Costs" by Arlene Weintraub. This article coincided with a release last Wednesday from United Healthcare, Inc. proclaiming "More Employers Turning to UnitedHealthcare's Diabetes Health Plan to Help Improve Health, Control Costs".

I had read UnitedHealhtcare's January 15, 2009 press release on this program, and had pretty much dismissed it, assuming it was yet another example of the typical so-called "disease management" programs of the sort that is outsourced to third-party vendors. A video by UnitedHealthCare was prepared and can be viewed HERE (and below).



In my own experience, these third-party vendors provide automated reminders to patients (often computer-generated phone calls and e-mail blasts to remind patients to show up to their doctor's appointments, take their medications, exercise and perhaps a nearly useless newsletter on diabetes management aimed at people whose knowledge of the disease is next to nothing).

As might be expected, there is a trade association of these vendors for this industry called the Disease Management Association of America (DMAA) (Note: since September 2007, the organization has been working to re-brand itself as the Care Continuum Alliance) which has released countless so-called "studies" which they claim proves the value and worth of these programs. But the evidence is clearly mixed.

For example, back in 2007, I wrote a posting about yet another study that had raised questions on whether these third-party disease management programs do anything to reduce costs. A number of studies including one by the RAND Corporation and another done by the U.S. Government's own Congressional Budget Office (CBO) determined that the value of these programs could not conclusively be quantified in dollars. Part of the problem is that patients are expected to pick up the cost of compliance with these programs (which is costly), but are seldom provided much financial incentive in terms of reduced co-pays, or even ease in navigating through the insurance coverage process.

Speaking from my own experience, I received dozens of irritating e-mail reminders and robo-calls, and had continued hassles in getting the very insurer who enrolled me in the program to pay for testing supplies I needed to maintain glycemic control, or get them to pay for an insulin pump, for example. On that basis, the program was more of a hassle that did almost nothing for me, but a third-party vendor was paid handsomely to administer the so-called "disease management" program. Eventually, I requested to be removed from the program which provided me no financial incentive, yet rated high on the annoyance factor.

That isn't to say that the programs are of no value, but clearly, if we're looking to save money on healthcare, we need to consider the way we quantify success. But what makes the BusinessWeek story most interesting is that some big employers, such as GE and Hewlett-Packard to name a few, have had a role in the design of the program, not the healthcare insurer alone. As a result, there have been some pretty profound changes in the "new" UnitedHealthCare Diabetes Health Plan.

What's different?

First, UnitedHealthCare is offering the Diabetes Health Plan only to large companies that are self-insured, meaning the employers bear the entire risk while the insurer administers the plan. Second, although the program is flawed on the use of "surrogate" markers for disease outcomes without considering the big picture, those are already used in the basis of approving or denying coverage. While this plan aims to get patients to adhere to treatment guidelines and to agree to be tracked by the company to ensure they're compliant, it also provides real financial incentives, making it unusual. If that sounds a bit big-brotherish, consider that the reality is that insurance companies are already doing that anyway, and HIPPA allows them to do so without disclosure to the patient, as they're considered "covered entities" exempt from disclosure to the patient. But the key difference is that those who stick with the program will receive significant discounts on out-of-pocket expenses such as co-pays for diabetes-specific treatments which can reduce the person's healthcare costs significantly. Those who don't "comply" are kicked out of the program and put back into their company's standard plan, the one without the financial benefits.

According to the BusinessWeek article, UnitedHealthCare provided the following hypothetical scenario: Say a company's standard plan charges co-pays of $30 to $50 for prescription drugs; those fees would be completely waived on insulin, insulin pens, possibly even insulin pump infusion sets or syringes/pen needles, and/or oral drugs that diabetes patients use to control their blood sugar and on glucose meters for testing their blood. Deductibles might also be reduced, and these are growing increasingly common across healthcare plans nationwide. Patients must agree to twice-yearly physician checkups (for those already doing this, its really just a huge price break) and other preventive measures, and they have to sign to allow United to keep an online scorecard that uses claims data to keep track of their compliance. As I've noted, UnitedHealthCare already tracks patients who order diabetes medicines through their pharmacy benefits manager (PBM) and knows far more about patients than most realize, so the risk to patients in terms of privacy is vastly overstated, but the rewards are significant.

The financial benefits to patients participating in the program are rather significant, and can add up to quite a bit in out-of-pocket expenditures, saving patients a LOT of money. Whether the program helps patients navigate through UnitedHealthCare's maze of approvals, appeals, etc. remains a mystery, but it is clear that program enrollees have access to a dedicated staff who CAN help patients deal with such matters.

For the moment, UnitedHealthCare is offering the Diabetes Health Plan only to large companies that are self-insured, meaning the employers bear the entire risk while the insurer administers the plan. But if this program proves successful, other insurers are almost certain to mimick the program, and potentially improve it.

UnitedHealthCare acknowledges that the biggest opportunity comes not so much from people with diabetes, but those with a condition whose very existence is disputed: pre-diabetes. Indeed, David Kliff, the Diabetic Investor, argues:

"'Pre-diabetes'" is like a woman being sort of pregnant. Either you have diabetes or you don't. The fact that the popularity of 'pre-diabetes' has taken hold is further confirmation that the people who are supposed to be helping with the diabetes epidemic have lost touch with the real world."

Patients with "pre-diabetes" have not officially been diagnosed with a disease, so enrollment in such a program raises questions of ethics on how best to spend limited healthcare dollars (pursuing those who aren't officially sick, or treating those who actually have a disease?), not to mention exposes the employers and their healthcare providers to potential lawsuits challenging the efforts. However, as long as the program enrollment remains voluntary, that isn't a real issue.

Whether pre-diabetes is genuine or not has little to do with the opportunity to save significant money. According to BusinessWeek:

"... the biggest potential savings for the employer, according to United, come when you prevent people with 'pre-diabetes'—who are also eligible for United's plan—from developing the full-blown illness. 'We know if a pre-diabetic loses 7% of their body weight, the chance they'll become diabetic goes down by 58%,' says Dr. Deneen Vojta, vice-president and medical officer at United. 'The numbers get astronomic.'"

Is there a downside? At the moment, the lower-cost diabetes patients (those deemed "compliant") aren't restricted. But if the insurers decide to shift focus away from patients with diabetes concluding that once they're diagnosed, it's a lost cause in an effort to save money, then challenges could emerge down the road.

But right now, the lure of immense cost-savings across the board in diabetes management suggests that is not likely to emerge as a problem anytime soon.