Prairies States Puts the Brakes on Cost Drivers
Understanding healthcare cost drivers is critical for self-funded health benefits plans. But most companies don’t have good data to know what their cost drivers are, let alone have the tools, strategies or capabilities to address them.
Prairie States works with brokers and employers to put the brakes on cost driver expenses. We collect and measure a company’s data to identify cost drivers, then we give you the best practice risk and cost driver reduction strategies. Here are the five areas we scrutinize to get cost drivers under control:
1. Preventable Chronic Diseases: Preventable long-term illnesses – with obesity, type 2 diabetes, hypertension, certain cardiovascular diseases and some cancers topping the list — account for more than 75 percent of all healthcare expenses.1 Unhealthy lifestyle choices, such as smoking, alcohol abuse, poor diet, lack of physical activity and chronic stress, are common preventable chronic disease triggers.
Studies show that a wellness program, like Prairie States’ Optimal Health, slows down the causes and effects of preventable chronic diseases. In one meta-analysis, medical costs fell by about $3.27 for every dollar spent on a wellness program and absenteeism costs fell by about $2.73 for every dollar spent.2
Prairie States’ Optimal Health is a popular plan that’s customizable to fit a company’s culture and needs, as well as a member’s personal goals. Members choose from options such as online biometric tracking, activity tracking, education tools, incentive programs, condition management and one-on-one, year-round health coaching by phone. Because members choose options that suit their lifestyle and goals, lifestyle habits are improved and the risk of chronic disease is reduced.
2. Chronic Diseases: Roughly 133 million Americans, or 45 percent of the population, currently live with a chronic disease. They are not necessarily preventable and typically include asthma, diabetes, back pain and cardiovascular disease.3 The demographic accounts for 81 percent of hospital admissions; 91 percent of all prescriptions filled; and 76 percent of all physician visits.4
To control this significant healthcare cost driver, Prairies States’ Condition Management clinicians act as a patient advocate, working directly with members and their healthcare providers to develop a plan that can improve health while also save on medical costs. Condition Management also includes assessment tools to track progress, collaboration with healthcare providers and ongoing patient education.
3. Fragmented and Delayed Care: Disease treatment can include multiple healthcare providers. But too often there is no consultation between attending medical professionals. Fragmented care can result in redundant tests and delayed diagnosis. Delays can be a crippling cost driver. Consider this: early-stage breast cancer treatment costs on average around $14,000 per year. Late-state treatment averages $61,000. Proper screening and early intervention not only improves outcomes, but equals a difference of $47,000 for one patient in one year.5
Our concierge-styled FiveStar Health wellness program coordinates medical professionals so potential health risks can be addressed and if necessary, treated at the earliest possible and most cost-efficient stage. Among its many benefits and features, this unique program helps members:
- Take advantage of preventative services
- Set up preventative and diagnostic appointments
- Meet health and wellness goals
- Choose the best healthcare provider for their needs
- Determine topics that should be discussed with a physician
4. Inflated Costs and Errors: Data from the Organization for Economic Cooperation and Development (OECD) shows that average unit costs for U.S. physicians, hospitals, facilities and drugs are the highest in the world.6 Plus, “eight out of every 10” hospital bills contain multiple errors, according to Medical Billing Advocates of America.7 1. National Center for Chronic Disease Prevention and Health Promotion. “The Power of Prevention Chronic disease . . . the public health challenge of the 21st century.” Page 1. (http://www.cdc.gov/chronicdisease/pdf/2009-Power-of-Prevention.pdf)
Prairie States’ clinicians act as a consultant and guide for the member. They analyze claims and identify inappropriate charges based on errors as well as excessive and redundant use of tests, procedures, medications and medication interactions. Armed with insights and expertise, our clinicians intervene on the employer’s and member’s behalf, examine medical choices and costs, and save our customers millions of dollars.
5. Patient Compliance: Following doctors’ orders can be complicated. It’s estimated that three-quarters of patients fail to take their medications as directed.8 In addition, there’s often confusion about physician follow-up appointments and home monitoring procedures after hospital discharge, which explains why about one in 12 adults are readmitted to the hospital within 30 days of discharge.9
Prairie States’ wellness programs counsel members so they can better understand how to make the most of their care and get well as quickly as possible. When issues involving incomplete or misunderstood information are resolved, disease progression, hospital readmission, and costs can get under control.
Through data collection and analysis, Prairie States works with brokers to identify the cost drivers that can plague clients. We’ll give you the data you need and work with you to structure, and then restructure, a plan to control cost drivers, while simultaneously meeting employer and employee needs.
Talk to your clients today about how Prairie States can improve member health, put the brakes on cost drivers and reduce healthcare costs.
2. Soeren Mattke, Christopher Schnyer, Kristin R. Van Busum. Rand Health: A Review of the U.S. Workplace Wellness Market. Sponsored by the U.S. Department of Labor and the U.S. Department of Health and Human Service. Page 22. (http://www.dol.gov/ebsa/pdf/workplacewellnessmarketreview2012.pdf)
3,4. Partnership to Fight Chronic Disease. Agency for Healthcare Research and Quality. “The Growing Crisis of Chronic Disease in the United States.” (http://www.fightchronicdisease.org/sites/default/files/docs/GrowingCrisisofChronicDiseaseintheUSfactsheet_81009.pdf)
5. Society for Human Resource Management. Screenings and Early Intervention Can Reduce Medical Costs. By Stephen Miller, CEBS 4/19/2012. Last accessed March 24, 16. (https://www.shrm.org/hrdisciplines/benefits/articles/pages/earlyintervention.aspx)
6. Bob Herman. “9 Drivers of High Healthcare Costs in the U.S.” Becker’s Hospital Review http://www.beckershospitalreview.com/finance/9-drivers-of-high-healthcare-costs-in-the-u-s.html
7. Health Care, NBCNEWS.com. “Medical-bill errors becoming more common.” http://www.nbcnews.com/id/21527433/ns/health-health_care/t/medical-bill-errors-becoming-more-common/#.VvR1vWQrIiU
8. National Community Pharmacists Association. “Medication Adherence in America – A national report card.” Page 6. http://www.ncpanet.org/pdf/reportcard/AdherenceReportCard_Full.pdf
9. National Institute for Health Care Reform. News Release, Dec. 8, 2011. “A Third of Adults Discharged from a Hospital Don’t See a Doctor Within 30 Days” http://www.nihcr.org/news_Reducing_Readmissions
Prairie States Enterprises, Inc. is a third-party health benefits plan administrator that brings industry expertise and a clinical focus to self-insured companies. Our in-house claims administration, health management services, wellness programs, plan analysis and predictive modeling tools result in remarkable and unprecedented cost control for employers. We also provide the most compassionate and personalized level of service for plan members.