Parental wisdom

Cathy Eddy, President, Health Plan Alliance

09/14/2016

I’m sure we all have that phrase that pops into our heads (usually in our parent’s voice) when the perfect situation calls for it. Recently I was having dinner with some fellow board members and Pam shared one of her father’s pearls:

“Never judge yourself by a bad example and feel good about it.”

I’d not heard this one before, but I liked it so much I had to write it down (before I forgot it). It seemed to be relevant today in many ways.

The health care industry is full of examples where we are comparing our performance to one another. Quality metrics, customer satisfaction scores, operational performance and financial reviews. The number of hours spent responding to reporting, accreditation and audits add up to a few FTEs in every organization. We have STAR ratings, HEDIS, NCQA and lots of other ways to measure our relative success.

We have been moving, however slowly, to value-based payment, where “value” is defined in many ways. Health care is becoming more and more expensive, while the satisfaction level seems to go down. Part of the reason for the increased decline in satisfaction is the cost shift to consumers.

The Commonwealth Fund recently published an analysis on the characteristics of high-need, high-cost patients. Here are some key findings from the report:

For high-need adults, annual spending on healthcare was $21,000/person.
2 in 3 adults with high needs were women, vs. half of the total population.
High-need adults spent $1,669 out-of-pocket, vs. $702 for other adults.
1 in 4 high-need adults did not finish high school and 3 in 4 were white.
Household income was $25,668 for high-need adults vs. $52,685 for others.
4 in 5 adults with high needs (83%) reported fair or poor health.

ACA has driven a great deal of change in our industry – some good and some not so much. The public exchange or marketplace has provided an opportunity for many individuals to get insurance that didn’t have it before or to buy it with subsidies. The example above shows how high-need adults need subsidies when their total costs are more than 80% of their income. Their out of pocket is 6.5%.

However, the higher premiums are driving other individuals out of the market. Many insurers have pulled out of the exchanges after losing millions and 16 of the 23 exchanges will be gone by the end of this year. Poor financial performance is leading to more limited choices. Some markets now have only one choice of insurers on the public marketplace.

As we look for ways to improve our performance and seek comparative benchmarks, let’s share examples we can feel good about. The Health Plan Alliance is always looking for success stories from our member plans – do you have one you can share?

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