Improving Care and -Reducing Costs for the Chronically Ill
by Andrew Halpert, MD

No matter what hap-pens in the debate over expanding healthcare coverage, California will face ever-increasing medical costs. Brokers will still face the challenge of helping their clients find ways to control healthcare spending.
Critics of managed care like to claim that health plans try to cut costs by giving people less care than they need. The recent Michael Moore film, “Sicko,” presents a particularly harsh and inaccurate picture of what health plans do. Driven by ignorance of the value of coordinated care, some in Congress want to make dramatic funding cuts for Medicare managed care plans.

In reality, health plans undertake many strategies to control costs by making sure people get the most effective and humane care possible. I have been involved in a program that improves the care provided to one of the most critical and costly populations in the healthcare world -- people with extremely severe illnesses. Helping this population is critical to reducing the cost trend since the sickest 0.5% of patients account for 20% to 30% percent of healthcare spending.

A recent peer-reviewed article in the American Journal of Managed Care, which I co-authored, examined this complex care program. It provides intensive hands-on nursing care coordination to help people manage their treatment with clinically advanced illnesses, such as late stage cancers or degenerative neurological conditions.

The study examined the outcomes of 750 HMO members who participated in an
18-month patient-centered management pilot program. The program deploys a team of care managers, who are registered nurses (RN) and a physician in clinical practice. After an onsite visit to the patient’s home, the RN stays in contact through regular phone calls and in-person visits when needed. Each nurse maintains a very low caseload, so that they have plenty of time for each patient. This enables the nurses to take a proactive, problem-solving approach to the many issues that arise with a serious illness. They can counsel patients on their options and make sure they take the appropriate medications and meet with the doctors they need to see. Along with more home care, comes a dramatic drop in avoidable hospitalizations and emergency room visits, which is great news for patients and their families. It is also major contributor to cost reductions.

“As a cancer patient I have had challenges and burdens unimaginable,” says one 50-year-old program participant. “The (patient-centered management) program has actually made me want to fight that much harder. My care manager was in constant contact and pulled me through all the obstacles a cancer patient must endure to receive the much given treatment.”

In general, the study concluded that the patient-centered management reduced over-all costs by 26%. Patients had fewer costly hospital days and emergency room visits, with care shifting to less costly home care and hospice settings when appropriate. The study revealed the following
• Hospital admissions declined 38%
• Hospital days were declined 36%
• Emergency room visits declined 30%
• Home care increased 22%
• Hospice use -increased 62%

For the 18-month study duration, the average combined utilization cost was $49,742 for each patient in patient centered management. This is compared to $68,341 for those who were treated with usual care management, resulting in average savings of about $18,599 per patient. After accounting for the additional cost of the program, the there was a two to one return on investment. Even better, patient and family satisfaction scores were outstanding, exceeding 90% on every measure.

Based on the successful outcomes of the complex care program, additional research is underway to determine the effect that similar interventions may have on those who are less critically ill. Preliminary results indicate that similarly structured, though slightly less intensive, patient-centered management may yield similar results.
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Andrew Halpert, MD, is senior medical director of Blue Shield of California and co author with Latanya Sweeney, PhD., Carnegie Mellon University, Pittsburgh, Pa, and Joan Waranoff, MS, MBA, Blue Shield of California of “Patient-centered Management of Complex Patients Can Reduce Costs Without Shortening Life.”