Good medicine sounds simple: Get the right care to the right patient in the right place at the right time.
But if that patient has a severe chronic disease such as asthma, congestive heart failure or diabetes, the stakes rise dramatically. If a diabetic condition goes undetected and leads to end-stage renal disease, for example, the alternatives can be stark for the patient and the health insurer: dialysis, which can cost as much as $70,000 per year, or a kidney transplant, which can run up a bill of more than $100,000.
Diabetics constitute 5% of the population but consume about 14% of all healthcare dollars, says Eric Book, M.D., chief medical officer at Des Moines, Iowa-based Wellmark. At Wellmark, which operates Blues plans in Iowa and South Dakota, 20% of the enrollees account for 87% of the health plan's medical costs, Book says. And just 1% of enrollees were responsible for a whopping $465 million of the $1.55 billion Wellmark spent on healthcare benefits last year, Book adds.
Those numbers are in line with the observations of Harvard Business School professor Regina Herzlinger, who says that one-fifth of patients use about four-fifths of healthcare resources.
Patients and insurers benefit when chronic or debilitating conditions are diagnosed early and treatment is coordinated. The two steps form the basis of disease management, which is making its mark on the industry.
Most of the progress in disease management has occurred in the last two to three years.
Humana enrollee Elinora Nichols of Louisville, Ky., learned about disease management the hard way. She was diagnosed with congestive heart failure after being rushed to Columbia Suburban Hospital-now Norton Suburban Hospital-in Louisville several years ago. "I was about dead when I got there," recalls Nichols, "but they've been taking good care of me since then."
Nichols receives educational pamphlets on how to deal with congestive heart failure, which affects about 4.8 million Americans. She also gets monthly phone calls to check on her eating habits, salt intake and medication supply. "So far, it's been great," Nichols says. "I'd have to give Humana a gold star."
Evolutionary step. Some see disease management as a logical next step in the evolution of managed care. It follows on the heels of primary care and focuses on the "secondary prevention" of chronic conditions and their complications.
"The main impetus is clearly coming from the very well-integrated managed-care organizations," because they have the resources and the financial incentive to lead the charge, says David Nash, M.D., director of health policy and clinical outcomes at Thomas Jefferson University Hospital in Philadelphia and co-editor of a new book called Disease Management: A Systems Approach to Improving Patient Outcomes.
In a recent speech at the annual conference of the National Committee for Quality Health Care, Kaiser Permanente Chief Executive Officer David Lawrence, M.D., made the same point, arguing that only integrated delivery systems can offer comprehensive care for chronic diseases. "Having a patchwork of systems doesn't do the job," he said.
Individual hospitals and systems generally are not disease-management pioneers, because attracting more high-risk patients is economic suicide under most managed-care contracts.
"The biggest barrier right now is the absence of risk adjustment," says Herzlinger. She says a horizontally integrated healthcare industry can evolve and benefit from economies of scale only with a sophisticated risk-adjustment payment system.
The U.S. spends roughly $400 billion per year on diseases that are the focus of disease management, according to Al Lewis, president of the newly formed Disease Management Association of America. He predicts that disease-management vendors and programs could take in about 10% of that amount at today's levels.
Managed-care companies have contracts with about 160 vendors that focus on disease management for conditions such as congestive asthma, heart failure and diabetes. Lewis estimates these vendors will take in about $350 million in revenues this year, or more than twice their estimated total in 1998.
Hotbeds of activity include Connecticut, Florida, New Jersey and Texas, and the cities of Chicago; Kansas City, Mo.; Las Vegas; Phoenix; and Pittsburgh, according to Lewis, one of the few people who have tracked the industry in detail.
Lewis says he believes the disease-management business will continue to double or nearly double annually for the next several years, but Nash cautions that it's nearly impossible to verify those numbers. "I don't think anybody has reliable numbers," says Nash.
No easy task. Wellmark's Book points out that while a number of health plans have disease-management programs under way, few are at the level of individual case management. That's likely to change, however, "as more and more health plans and integrated systems are at risk" financially for managed-care enrollees, he says.
Further, establishing effective disease-management programs isn't easy. Challenges include layers of bureaucracy, inertia and lack of information. Disease management is dismissed as a fad almost as often as it's touted as one of managed care's liveliest inventions.
Nash says a significant problem is simply achieving and maintaining medical quality, or eliminating "unexplained clinical variation," as he described it at a recent National Managed Health Care Congress on disease management in Pasadena, Calif. The root of the problem is the failure of many physicians to keep up with the latest trends in their fields and to implement the latest scientifically proven procedures, Nash said at the February conference.
All too often "doctors do whatever they damned well feel like," he complained.
As a result, Nash and other disease-management experts believe that significant new research is needed to prove to recalcitrant doctors which procedures are scientifically sound and which should be discarded. Currently, Book says, many approaches compete in various specialties, "and it's very hard to benchmark, because everybody's doing it a little differently."
Another significant obstacle is patients' failure to comply with the regimens their physicians and health plans prescribe.
Simply identifying chronic patients can be difficult because of variations in coding by physicians and other providers.
Getting results. Nonetheless, health plans and providers such as Cigna HealthCare, Fallon Community Health Plan and the affiliated Fallon Clinic, Humana, Kaiser Permanente, Lovelace Health Systems, Oxford Health Plans, Wellmark, and WellPoint Health Networks are investing significantly in disease management and showing some substantive results.
At Cigna, for example, pilot programs in asthma, diabetes and lower back pain have been so successful that the Hartford, Conn.-based managed-care giant plans to expand geographically and into new disease areas. Other initiatives are already under way in many of its local health plans.
"We plan to have 17 markets covered by the end of 1999 and to expand very rapidly after that," says Victor Villagra, M.D., vice president of quality and strategic medical affairs at Cigna.
Senior officials at Humana say disease management is a central business and clinical strategy for the 6.2 million-enrollee health plan. Overall, about 50,000 Humana enrollees participate in one or more of the programs, including initiatives in asthma, cancer, congestive heart failure, end-stage renal disease and neonatal intensive care, as well as rare diseases such as cystic fibrosis and hemophilia.
More than 4,000 Humana enrollees with severe cases of congestive heart failure are participating in a national program-the largest of its kind, according to Humana-which has cut overall inpatient costs by 61% and slashed the number of days those patients spend in the hospital by 58%.
"These are folks who are going in and out of the emergency department on Saturday nights," says Jerry Reeves, M.D., a Humana senior vice president and the Louisville, Ky.-based company's chief medical officer. "They can't walk across the room. They're short of breath. Their mortality rate is 10% a year."
After participating in the program, those same patients eat less salt, can walk farther, are more mobile, and generally have a higher quality of life and a lower mortality rate. There's also a big payoff for Humana, which shaved an estimated $22 million in costs through disease management last year, Reeves says.
The congestive heart failure program at Humana, like many offered by major managed-care plans, is actually operated by a vendor, Cardiac Solutions of Buffalo Grove, Ill. But Humana last August launched its own disease-management program, Advanced Care Partners, to target patients with multiple chronic conditions.
About 1,250 Humana enrollees-the "sickest of the sick," participate in the program, says Richard Vance, Humana's vice president of population health improvement. The typical enrollee, in fact, suffers from 4.3 chronic conditions.
So far, by expediting care and creating customized care plans for this group of patients, Humana has slashed inpatient days per 1,000 by "some 38%," Reeves says. That's significant because the patients had required five or six times more inpatient care than the average Medicare beneficiary, which was a major pain for the patients and a drain on Humana's coffers.
Interest soars. Because of such results, and despite concerns about how to implement disease-management programs, interest in the approach is soaring.
On March 1, the Disease Management Association of America was launched. Members of the trade group, based in Wellesley Hills, Mass., include health plans, providers, pharmaceutical companies and specialized disease-management vendors.
Association President Lewis says the disease-management niche will continue to grow unless Congress passes patient-protection bills that prohibit managed-care organizations and vendors from obtaining crucial patient data.
Lewis also serves as executive director of the Disease Management Purchasing Consortium, which links purchasers such as health plans with disease-specific vendors such as Cardiac Solutions.
Most managed-care plans outsource disease management, Lewis says, although a few HMOs-including Aetna, Foundation and Kaiser-prefer to go it alone.
Wellmark, for example, outsources complex case management for about 1% of its enrollees, Book says.
In contrast, Kaiser Permanente thinks its internally developed guidelines and protocols are superior to anything available on the market, says Peter Juhn, M.D., who heads Kaiser's Oakland, Calif.-based Care Management Institute. The institute coordinates disease management for all the affiliated Permanente medical groups nationwide. It has programs to treat asthma, congestive heart failure, coronary heart disease, diabetes and depression.
And because of its size, 8.6 million-enrollee Kaiser has volumes of data from which to draw. For example, a 1997 outcomes study looked at about 250,0000 diabetics and found that after enrollees participated in a disease-management program, their results on a commonly used blood-sugar test improved by about 15%, Juhn says.
But he acknowledges that "best practices" can take one or two years to filter down to all Kaiser's far-flung medical groups and facilities. "Our goal is to cut that down to several months," Juhn says, "but there's a limited capacity for change-and limited resources."
Silent revolution. Even so, many observers say disease management is making significant inroads nationally.
"There's been a lot of groundwork done over the last two years, and there's really a silent revolution going on," says Robert Crocker, M.D., national medical director of care management services for Unicare, the national operating subsidiary of WellPoint Health Networks.
Unicare, in Huntington Beach, Calif., says a pilot diabetes-management program it started in early 1997 boosted participants' use of outpatient services by more than 250% while reducing hospital admissions by nearly 40%.
Giving participants more information and more control over their treatments is a key element of Unicare's pilot program, as well as many other disease-management initiatives. Other Unicare efforts cover congestive heart failure, depression, cancer and high-risk pregnancy.
The revolution Crocker has in mind is a shift from focusing largely on utilization review and cost to focusing on clinical outcomes and quality.
Nash and others believe that the Internet-with its vast potential as an educational resource for doctors and patients-will likely create 21st century consumers who are better informed and more demanding of their doctors and the healthcare system. Such consumers will push many providers to get on the disease-management bandwagon, says Nash, calling consumerism "a latent force" in disease management.
Delayed reward. Crocker's revolution hasn't hoisted its banner yet, however.
Wellmark's Book warned attendees at the National Managed Health Care Congress that the return on investment for many of these preventive measures "is very far out, and (the patients) may not even be part of our health plan" when those benefits are realized.
And Jeffrey Lenow, M.D., medical director at Thomas Jefferson University Hospital, warns that the data shortage Nash described will endanger the success of disease-management efforts.
"Disease management is still an untested field," he said at the NMHCC conference, and data "are anecdotal or limited."
Lenow puts his faith in getting physician leaders to buy into the idea of practicing scientifically proven procedures, or evidence-based medicine, and focusing on scientifically proven treatments for the major chronic diseases, which consume a huge part of healthcare resources. It's as simple, and as complex, as getting physicians to prescribe aspirin and beta blockers to patients who have suffered heart attacks, he says.
Disease management will reach its full potential only when inappropriate clinical variations-the polite term for treatment variations that have little or no scientific support-are eliminated or drastically reduced.
Lenow, like other disease-management backers, says at this point "we've barely scratched the surface" of what can be accomplished.