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CDHC Impact on Utilization, Costs, & Quality

CDHC Impact on Utilization, Costs, & Quality. A Control Group Study of the Impact of CDHC on Utilization, Costs, & Quality for Members Who Changed from TPPO in 2005 to CDHC in 2006. Kenton Johnston, MPH, MS, MA Bil Westerfield, MA Soyal Momin, MS, MBA Paul Kulpa, MS. June 8, 2008.

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CDHC Impact on Utilization, Costs, & Quality

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  1. CDHC Impact on Utilization, Costs, & Quality A Control Group Study of the Impact of CDHC on Utilization, Costs, & Quality for Members Who Changed from TPPO in 2005 to CDHC in 2006 Kenton Johnston, MPH, MS, MA Bil Westerfield, MA Soyal Momin, MS, MBA Paul Kulpa, MS June 8, 2008

  2. Introduction CDHC Impact on Utilization, Costs & Quality • National trend toward CDHC impacting Tennessee – reflected in increased demand from BCBST’s employer group customers • Percent of groups offering CDHC to members grew from 1% in 2004 to over 12% in 2006 • Growth especially focused in small and intermediate groups • At the same time, significant risk selection into CDHC observed: • Those who were offered both CDHC and traditional PPO (TPPO) benefits and chose CDHC had favorable socio-demographic and medical risk profile when compared with those who chose TPPO • Those whose employer fully replaced their TPPO benefits with CDHC had unfavorable risk profiles when compared with either those who chose CDHC or those who chose TPPO *See posters on CDHC growth trends and CDHC risk selection in Poster Session B on Monday from 8:00am – 9:30am in the Exhibit Hall

  3. Research Questions CDHC Impact on Utilization, Costs & Quality • Was there an observable difference in medical cost, utilization, or quality of care for members who had TPPO benefits in 2005 (yr1) and chose to adopt CDHC in 2006 (yr2)? • As compared to a control group of TPPO choosers • Was there an observable difference in medical cost, utilization, or quality of care for members who had TPPO benefits in 2005 (yr1) and were given CDHC benefits as their only option in 2006 (yr2)? • As compared to a control group with TPPO as their only benefits option in 2006 (yr2)

  4. Definition of Terms • CDHC = high deductible health plan (>$1,000 individual & >$2,000 family, federal law) + HSA or HRA qualified • HSA tax advantaged vehicle owned by individual - portable • HRA tax advantaged vehicle owned by employer • TPPO = traditional preferred provider organization group benefits • Adopted CDHC = member has CDHC benefits in given year • Chose CDHC = member offered several benefit plans but chose CDHC • Full Replacement = sole offering of CDHC replaces all other options

  5. Methods & Population CDHC Impact on Utilization, Costs & Quality • Propensity scores used to individually match CDHC study members to TPPO controls on basis of demographics, morbidity, risk, utilization, cost, predicted cost, & quality in 2005 (yr1) • Baseline period (yr1) was 2005 and study period (yr2) was 2006 • 960 members (of 1,194) who chose CDHC in 2006 (yr2) were individually matched to 960 controls who chose TPPO in 2006 (yr2) • All were enrolled in TPPO in 2005 (yr1) • 404 members (of 438) with CDHC as their only option in 2006 (yr2) were individually matched to 404 controls with TPPO as only option • All were enrolled in TPPO in 2005 (yr1) • Only small and intermediate group members eligible for study

  6. Utilization & Cost Variables CDHC Impact on Utilization, Costs & Quality • Total Allowed $, Paid $, Member OOP $ • Inpatient Utilization and Costs • Hospital Stays • Hospital Days • Total Inpatient Allowed $ • Professional & Outpatient Utilization and Costs • Office Visits & ER Visits • Preventive/Well Visits • PCP, Specialist, & Clinic Visits • Efficient & Non-Efficient Provider Visits • Ancillary, Surgery, & Management Allowed $ • Total Prof/Outpatient Allowed $ • Pharmacy Utilization and Costs • RX Scripts & Supply Days • Generic & Brand Scripts • Total RX Allowed $

  7. Quality of Care Variables CDHC Impact on Utilization, Costs & Quality • Quality of care operationally defined according to MEDai Chronic and Preventive Gaps in Care Measures – two global quality scores • Chronic Care Compliance Percent: • Diabetes • CAD, CVA, Post-MI • Hyperlipidemia • Asthma • COPD • Depression • Preventive Care Compliance Percent: • Mammogram • Colon Screening • Pregnancy Urine Culture • Pregnancy HIV Screen

  8. Baseline Period (Year 1) Results CDHC Impact on Utilization, Costs & Quality • After propensity matching, no statistically significant differences found between CDHC Choosers study group and TPPO Choosers control group – or between CDHC Only Option study group and TPPO Only Option control group • Baseline variables tested: • 2005 deductible amount and employer group size • Socio-demographic data • Morbidity data • Professional/outpatient, inpatient, & pharmacy utilization • Professional/outpatient, inpatient, & pharmacy costs • Total allowed costs and OOP costs • Predicted costs • Chronic and preventive quality of care

  9. Deductible Amount CDHC Impact on Utilization, Costs & Quality • CDHC & TPPO Choosers: • CDHC 2006 Mean Deductible = $1,859 • TPPO 2006 Mean Deductible = $351 • CDHC & TPPO Only Option: • CDHC 2006 Mean Deductible = $2,360 • TPPO 2006 Mean Deductible = $444

  10. Study Period (Year 2) Results CDHC Impact on Utilization, Costs & Quality Reduced Utilization, $615 Reduced Utilization, $1,074 Payer Savings, $991 Payer Savings, $1,522 Cost Shift, $449 Cost Shift, $376 CDHP & TPPO Choosers CDHP & TPPO Only Option *Statistically significant difference (p <.05, ANOVA)

  11. Study Period (Year 2) Results CDHC Impact on Utilization, Costs & Quality 38% 30% 70% 62% CDHP & TPPO Choosers CDHP & TPPO Only Option *Statistically significant difference (p <.05, ANOVA)

  12. Study Period (Year 2) Results CDHC Impact on Utilization, Costs & Quality CDHP & TPPO Only Option CDHP & TPPO Choosers No statistically significant difference (p <.05, ANOVA)

  13. Key Findings Summarized CDHC Impact on Utilization, Costs & Quality • CDHC saved money for payers and employers • Utilization, Allowed $, Paid $ all lower for members with CDHC • Cost differential in paid amount = • cost avoidance (60% - 70%) + cost shift (30% - 40%) • Did CDHC members benefit financially or not? • CDHC choosers $375 (53%) more OOP than TPPO choosers, even though the allowed cost was $616 (20%) less • CDHC only option $449 (47%) more OOP than TPPO only option, even though the allowed cost was $1,073 (24%) less • Premium differential and HSA employer deposit are unknown • CDHC may have been more favorable than TPPO for many • Quality of care did NOT appear to be negatively impacted by CDHC deductible or the higher member OOP • No significant difference in chronic or preventive compliance for CDHC vs. TPPO members

  14. Implications CDHC Impact on Utilization, Costs & Quality • Payers may be able to successfully reduce costs using CDHC without negatively impacting member quality of care • It is not yet clear what impact (if any) this might have over a longer time period • It is not clear how much utilization can be reduced and/or cost can be shifted without negatively impacting quality • CDHC appears to be a great deal for payers and employers, not yet clear whether it is a good deal for members • Future research should include: • Premium cost, HSA employer deposit amount, and HSA tax savings in order to get full member financial picture • Greater number of quality measures for more conditions

  15. Questions? Bil Westerfield, MA, Research Scientist BlueCross BlueShield of Tennessee Medical Informatics 801 Pine St 2G Chattanooga TN, 37402 (423) 535-6260 William_Westerfield@bcbst.com June 8, 2008

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