Consumer-focused Care spoke with Gene Drabinski, Vice President of Cost and Quality for Trizetto, a leading enterprise software company providing solutions to health plans. As you may recall, we had an interview with another Trizetto executive, Dan Spirek, last year.
The interview took place at the World Health Care Congress and both a podcast and a transcript lay out the conversation below.
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Jonathan Kellerman sparked a firestorm of comments with his op-ed in today’s WSJ, titled The Health Insurance Mafia.
His premise, which I’ve been arguing for a while, and which Dr Rich has written about eloquently as Covert Rationing, is that insurance, rather than solving the problems of cost, creates much of the problems we see today.
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Was listening to a podcast with Robert Nesse, CEO of Franciscan Skemp Healthcare, which is part of the Mayo system.
In talking about High Value Health care, he put forth an interesting equation I hadn’t heard to date.
His take on the Value Equation for health was that is was:
Value = (Outcomes + Safety + Service)/(Cost + Time)
This is interesting to me as it is a mechanistic equation that seems to be based in a belief that there is some optimal value we can all agree on. One would imagine that would allow society to set some absolute value on each service, which fits in the overall approach taken by Medicare, Medicaid, health insurance, etc.
If we believe in a retail marketplace, value suddenly looks very different than the equation mentioned above. Per Karl Menger, in his Principles of Economics in 1873:
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In an interesting twist on how to get young people involved in healthcare, a nonprofit group called “Takes all Types” has released an app on Facebook, per TechCrunch.
When a patient is in need of blood that isn’t available, it becomes a life and death situation. Historically the Red Cross will make efforts to alert the public during a shortage. But there may be a better way – leverage the social networks to get the word out. If shortages of a certain type of blood occur in a certain zip code, having a database of willing donors in that zip code to contact may be the most efficient way to solve the problem quickly.
That’s where Takes All Types (TAT), a non-profit organization, comes in. Users install their just-released Facebook application, tell it their location and blood type, and say how often they are willing to be contacted to donate blood (maximum is every 57 days). If a shortage occurs, they’ll contact you via the methods that you authorize (Facebook, email, text message, etc.)
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Scott Shreeve has an interesting marketing take on CDHP plans, and a good one. Rather than emphasizing the high deductible (more relevant to insurance thinking), he emphasizes the low premium (certainly changes the dynamic of the conversation with consumers)
The whole notion of “high-deductible” is a misconception – why not change the paradigm by saying “Low-Premium” Health Plan (LPHP). The point is that the we are talking about insurance – you are buying risk protection from someone who is willing to assume it in exchange for your money. The more risk you want to avert, and the lower co-payments you want, the higher your monthly premium is going to be. If you are willing to go at risk, up to a defined level ($5,000 my case), you can save dramatically on your monthly insurance premiums. In addition, as you play the numbers out, your overall spending can also be 15-20% less with a LPHP over a traditional plan. This doesn’t even account for the behavior change that occurs when you are spending your own money and therefore become engaged in the decision making process.
As I posted before, the sticker shock of medical items is not financially worse than watching all the premium money previously being paid go “poof” every month. And, as I mention in my metrics article, what is being rewarded today certainly isn’t working– why shouldn’t we look to reduce excess premiums being paid as opposed to overall cost of healthcare? After all, people aren’t looking to reduce overall cost of consumer and high tech sectors despite outsized gains in those industries the past few years.
For most people (estimated 80-90% of employees), a CDHP plan will put them out ahead if most of premium savings (at least on for at-risk insurance) are given back in the form of HSA contributions (zero-sum balance).
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