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Managed Consumerism: The Next Generation of Consumer-Directed Health Insurance

Managed Consumerism: The Next Generation of Consumer-Directed Health Insurance. Terence Fitzgerald, M.D. Regional Medical Director Oxford Health Plans, LLC A UnitedHealthcare Company January 5, 2006. Background. 1980s – Rise of managed care Network restrictions, utilization rules

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Managed Consumerism: The Next Generation of Consumer-Directed Health Insurance

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  1. Managed Consumerism: The Next Generation of Consumer-Directed Health Insurance Terence Fitzgerald, M.D.Regional Medical Director Oxford Health Plans, LLC A UnitedHealthcare Company January 5, 2006

  2. Background • 1980s – Rise of managed care • Network restrictions, utilization rules • Co-pays limit cost exposure • Evolution towards “managed competition” • Late 1990s – Backlash against HMOs and managed care • Employer retreat from active engagement in health care policy/cost management • Broader networks, dismantling of utilization management, rise of PPOs • 2000s – Focus on effects of unjustified clinical variability • Outcomes transparency drive quality improvement • Hospital and physician quality metrics gain acceptance • Employers shift from “co-pay cost shielding” to cost-share transparency

  3. Early CDHP Results CDHP cost-share strategy works • Preventive visits maintained • Lower utilization in other areas • Inpatient admissions (10%) • Primary care (non-preventive) visits (5-6%) • ER visits/outpatient events (3-5%) • Higher utilization of specialty visits (3-4%) • Chronic conditions appear to get care (e.g. diabetes) Aetna, 2005

  4. CDHP Results: Concerns • Are lower inpatient admits related to lower PCP visits? • Do CDHPs with HRA/HSA only benefit the healthy and the wealthy? • Commonwealth Fund Study (released December 2005) • Americans enrolled in HDHPs/CDHPs less satisfied • But more cost conscious • And more likely to skip care • Lack information to make decisions • Do not trust information provided by health plans

  5. The Future: Managed Consumerism Role of Payers • Create meaningfully distinct networks based on transparency of quality and efficiency (quality drives lower cost) • Embrace “Pay for Performance” – transient incentive to drive change as performance becomes standard for maintaining in-network status Role of Providers • Create meaningfully distinct organizations based on performance (Q and E) Role of Consumers • Understand benefits and network composition Role of Employers • Educate employees on benefits • Provide more information on quality and cost issues

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