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Investing in Maternal and Child Health: Strategies for Employers
National Business Group on Health
December 11, 2007
Overview & Learning Objectives
• Understand how to use Investing in Maternal and Child Health: An Employer’s Toolkit– The business case for MCH– The Maternal and Child Health Plan Benefit Model:
evidence-informed benefit design– Effective strategies for communication, education,
engagement
• Investing in maternal and child health– What does “investing” mean?– Why is it important?– How can it be done?
Speakers
• Kathryn Phillips Campbell, Manager; Center for Prevention and Health Services
• Scott Rothermel, Consultant; NBGH• Rebecca Main, Marriott International; Maternal
and Family Health Benefits Advisory Board
Sources: 1. PricewaterhouseCoopers LLP. Actuarial analysis of the National Business Group on Health’s Maternal and Child Health Plan Benefit Model. Atlanta, GA: PricewaterhouseCoopers LLP; August 2007; 2. Shellenback K. Child Care and Parent Productivity: Making the Business Case. Ithaca, NY: Cornell Department of City and Regional Planning; 2004.
• $1 out of every $5 large employers spend on health care is for MCH services1
• Pregnancy is a leading cause of short- and long-term disability and turnover for most companies
• Children’s health problems are a leading cause of employee absence and productivity loss– Absences cost employers $3 billion per year2
– 26% of the time, employees calling in “sick” are providing care to a family member
Business Case
Business Case
• Improved MCH health is associated with:– Lower healthcare costs– Increased productivity– Improved retention– A healthier future workforce
Business Case: Children
• Important, but often overlooked population• 43% of NBGH employers provide dependent coverage
through age 25, pending school status1
• 33% of all beneficiaries are under the age of 252 • 14.7% of claims costs are for children & adolescents2
• 8.6% of employees provide care to a child with a special health care need3
• In 2003, children’s costs totaled $67 billion in the U.S.4
Sources: 1. National Business Group on Health. Maternal and Child Health Benefits Survey. Washington, DC: National Business Group on Health; January 2006; 2. PricewaterhouseCoopers LLP. Actuarial analysis of the National Business Group on Health’s Maternal and Child Health Plan Benefit Model. Atlanta, GA: PricewaterhouseCoopers LLP; August 2007; 3. Perrin J, Kuhthau K, Fluet C. Children with Special Needs and the Workplace: A Guide for Employers. Boston, MA: Center for Child and Adolescent Health Policy at the MassGeneral Hospital for Children; 2004; 4. Chevarley FM. Utilization and Expenditures for Children with Special Health Care Needs. Research Findings No. 24. Rockville, MD: Agency for Healthcare Research and Quality; 2006.
Business Case: Healthy Pregnancy
• In any given year, 5% of female employees will experience a pregnancy1
• Pregnancy and childbirth account for 25% of all hospitalizations in the United States2
• Complications of pregnancy are costly in the short- and long-term
• Each year employers spend $9 billion on claims related to prematurity and low birthweight2
• 10% of babies covered by employer-sponsored health plans are born with a prematurity diagnosis
• Other complications: preeclampsia, multiple births, 40% more C-sections today than in 19973
Sources: 1. March of Dimes, 2007; 2. National Committee for Quality Assurance. The State of Health Care Quality 2005: Industry Trends and Analysis. Available at: http://www.ncqa.org/Docs/SOHCQ_2005.pdf. Accessed on June 7, 2007; 3. CDC. National Vital Statistics Report, Vol 52, No 10.
Large Employer Specific Cost Data
• Actuarial analysis– Medstat database– PricewaterhouseCooper’s proprietary cost models
• 120,000 beneficiaries • Cost data from 2004
MaleMale
Children’s cost and service-use profiles are different than those of adults
Investing in Maternal and Child Health
1. Business case
2. Maternal and Child Health Plan Benefit Model
3. Healthcare strategy
4. Employer education and case studies
5. Beneficiary education and communication tips
6. Materials for employees on MCH topics
7. Tools, metrics, crosswalks
7-part resource guide on plan design, education, and communication
Maternal and Child Health Plan Benefit Model
• Plan design specific to the needs of children, adolescents, and childbearing women
• Comprehensive/unified plan (includes mental health, dental, vision, and prescription drug coverage recommendations)– Reduces administrative cost burden & allows for clinical integration
• Evidence-informed• Affordable (employee) & sustainable (employer)• Centered on prevention and early intervention• Designed by NBGH advisory board
– Benefit managers; medical directors; professional association delegates; experts in pediatrics, family medicine, occupational medicine; health plans; healthcare consultants
• Reviewed by 30 external experts
Structure
MissionWhy does the organization support the provision of
health benefits?
VisionWhat goals does the organization have for its health
benefit program?
Values
What aspects of the benefits are necessary or important?
Critical Success FactorsWhat will define success?
Evidence-Informed Benefits
• Evidence-based: strong scientific evidence of effectiveness (e.g., USPSTF recommendations)– Limited in pediatrics and obstetrics
• Recommended guidance: based on the best available information about a condition, disease or health service (e.g., expert opinion, consensus, panel judgments)
Maternal and Child Health Plan Benefit Model
• HMO and PPO plan designs• 34 recommended benefits• 5 categories:
– I. Preventive Services– II. Physician / Practitioner Services– III. Facility-Based Care– IV. Therapeutic Services / Ancillary Services– V. Laboratory, Diagnostic, Assessment, and Testing
Services
Innovative Benefits
• Preventive care– Preconception care– Postpartum care: lactation support– Early intervention services for mental health /
substance abuse– Preventive dental care
• E-visits & telephonic visits, group care, care by a healthcare team
• DME: Medical foods, cochlear implants, donor breast milk, breast pumps
Administrative Changes
Medically necessary care is:• Prescribed by a physician or other qualified healthcare provider. • Required to prevent, diagnose, or treat an illness, injury, or
disease or its symptoms; help maintain, improve, or restore the individual’s health or functional capacity; prevent deterioration of the individual’s condition; or remedy developmental delays or disabilities.
• Generally agreed to be of clinical value.• Clinically consistent with the patient’s diagnosis and/or symptoms.• Appropriate in terms of type, scope, frequency, duration, intensity,
and delivered in a setting that is appropriate to the needs of the patient.
Cost-Sharing Recommendations
**Zero cost preventive care
Cost-Sharing Recommendations
• Recommended total participant cost (premium, OOP total) *excludes prescription drugs– Individual (1): $2,370 total ($1,500 maximum
copayment/coinsurance, plus $870 premium).– Individual plus one dependent (2): $5,420 total
($3,000 maximum copayment/coinsurance, plus $1,740 premium).
– Family (3+): $5,420 total ($3,000 maximum copayment/coinsurance, plus $2,420 premium).
Cost-Sharing: Balance
• Growth in healthcare premiums has consistently outpaced both inflation and growth in workers’ earnings for the past 20 years.1
• Between 2000 and 2005, the cost of buying coverage for an employee increased 61% ($273) for single coverage and 60% ($971) for family coverage.2
• Family out-of-pocket costs for medical care are also on the rise. – In 2003, 18.2% of families with employer-sponsored health
coverage spent 10% or more of their annual income on medical expenses - a 28% increase over 8 years.1
Sources: 1. Henry J. Kaiser Family Foundation. Health Care Costs: A Primer. Key Information Health Care Costs and Their Impact. Menlo Park, CA: Henry J. Kaiser Family Foundation; August 2007; 2. Sommers JP. Offer Rates, Take-up Rates, Premiums, and Employee Contributions for Employer-Sponsored Health Insurance in the Private Sector for the 10 Largest Metropolitan Areas, 2005. Statistical Brief #178. Rockville, MD: Agency for Healthcare Research and Quality; July 2007.
Actuarial Analysis
Background– Summary– Plan benefit strategies– Employee feedback– Actuarial models
ProcessExamples
– Early Intervention Services for Mental Health / Substance Abuse
– Preventive Preconception Care
Actuarial Analysis - Background
Benefit managers have limited strategies if they expect to stay within their budgets:
a. Adjust benefit coverage levels / care management models for medical services
b. Adjust employee cost-sharing formulasc. Reduce demand for medical services by
incorporating coverage for preventive services – part of a value-based purchasing strategy
Actuarial Analysis - Background
Employer feedback– Benefit coverage levels: implemented majority
of financial management strategies– Employee cost-sharing: maximized, and in
some cases exceeded, cost-shifting burden to employees
– Prevention strategy: experimented with some services, but lack economic / financial models to implement comprehensive prevention strategies
Actuarial Analysis - Background
• Actuarial models– Primary application for evaluating the cost
impact of benefit coverage levels and cost-sharing strategies
– Secondary application considers prevention as a “cost offset”
• If cost is avoided then resources can be used elsewhere in the organization
Actuarial Analysis - Process
• Identified two plan types:– Health Maintenance Organization (HMO)– Preferred Provider Organization (PPO)
• Incorporate prevention strategy and related project values
• Results need to be financially competitive with existing employer strategies
Actuarial Analysis - Process
1. Establish MCH plan design
characteristics
5. Compare MCH estimate costs to
current market costs
6. Review MCH plan design and
recommend changes
2. Map diagnosiscodes (ICD-9) with MCH plan design
3. Develop benchmark HMO and PPO
models
4. Estimate cost impact of MCH
plan design
Actuarial Analysis - Process
3. Develop and benchmark HMO and PPO models • Populated benchmark models with national
data sets from Medstat and PwC • Peer-reviewed literature used to fill-in gaps
Actuarial Analysis - Process
4. Estimate cost-impact of MCH Plan Design considerations• Historical utilization rates / patterns• Managed care models for medical and
mental health• Population demographics• Cost-sharing model• Provider reimbursement levels
Actuarial Analysis – ExampleEarly Intervention Services for Mental Health / Substance Abuse
1. Establish MCH plan design
characteristics
5. Compare MCH estimate costs to
current market costs
6. Review MCH plan design and
recommend changes
2. Map reimbursementcodes and services with
MCH plan design
3. Develop benchmark HMO and PPO
models
4. Estimate cost impact of MCH
plan design
Actuarial Analysis – ExampleEarly Intervention Services for Mental Health / Substance Abuse
Benchmark model– Insufficient experience data available to support the
benchmark model
Benefit estimated to cost employers– $4.83 (HMO) and $5.85 (PPO)
Overall plan impact– Increase plan costs by 1.7% and 1.9%, respectively
Cost offset– Probably cost-saving
Cost-Impact Summary
• Adopting all of the recommended benefits would cost the average employer, with a market-average plan design, an additional 6% for a HMO or 10% for a PPO
• Most large employers already provide some of the recommended benefits
• Cost-impact assessments provided on a per benefit level and per category– Adopting all preventive services for a HMO plan would cost:
3.8% / $10.99 PMPM– Adopting the recommended well-child care benefit would cost:
0.1%/ $0.37 PMPM
Balanced Scorecard & Analysis Tools
• Balanced Scorecard– Value Proposition– Perspectives– Key Performance Indicators
• Strategy Maps• Side-by-Side Analysis Tool
Balanced Scorecard and Analysis Tools
• Balanced Scorecard Value Proposition– Develop a maternal and child health strategy– Evaluate existing health benefits– Implement and track the MCH Plan Benefit
Model recommendations– Design and evaluate additional MCH and
work/life benefits
Balanced Scorecard and Analysis Tools
Perspectives and Key Performance Indicators (KPIs)–Financial
KPI: 0% net increase in plan costs 1 year after adopting up to three MCH Plan Benefit Model preventive services.
–CustomerKPI: X% increase (from baseline) in number of participants / attendance rate in pregnancy education program.
–OperationsKPI: X% decrease (from baseline) in number of children who have an ER admission related to asthma symptoms.
–Learning and GrowthKPI: X% increase (from baseline) in the number of home health visits post-delivery.
Side-by-Side Analysis Tool
• Summary– Benchmarking and analysis resource
• Directions for use– Gather plan benefit documentation (i.e., summary
plan description, administrative contract)– Insert relevant plan information– Summarize key differences– Analyze variance– Consider plan modifications
Education and Engagement
• Research and experience show that plan changes aren’t enough to improve health
• Communication fact sheets– Open enrollment opportunities– Low health literacy challenges
• Employee education resources– Preconception, prenatal, and postpartum care– Child health– Adolescent health
Marriott International
Rebecca Main
For Additional Information, Contact
• Kathryn Phillips Campbell: [email protected]
206-708-1610• Georgette Flood:
202-585-1837
PDF copies of all materials available at:
www.businessgrouphealth.org/healthtopics/maternalchild/investing
