Healthcare Town Hall

This analysis published in the Journal of Occupational and Environmental Medicine (subscription required) by Ksenia Draaghtel and Jill Van Den Bos examines the total cost burden of autoimmune inflammatory diseases. The study takes an employee and employer’s perspective by using direct and available indirect costs from a national data source. The data includes total direct medical costs, number of absence days, and indirect costs related to work absences.

Read more about the study here.

Research autoimmune inflammatory disease, Cost, Jill Van Den Bos, Ksenia Draaghtel

Atrial fibrillation is the most common form of cardiac arrhythmia, better known as an irregular heartbeat. The disorder has significant health and cost concerns for the Medicare population because of its association with an increased risk for stroke and all-cause mortality.

A study published in the May/June issue of American Health & Drug Benefits by Milliman’s Kate Fitch, Jonah Broulette, Bruce Pyenson, and Kosuke Iwasaki used Medicare Part D claims data to assess the use of the anticoagulant drug warfarin in the Medicare population.

Here is an excerpt highlighting key points from the study entitled “Utilization of Anticoagulation Therapy in Medicare Patients with Nonvalvular Atrial Fibrillation:”

• Patients with atrial fibrillation (AF) are at a significant, 5-fold increased risk for stroke and all cause mortality compared with those without AF.

• Oral anticoagulation therapy is recommended by national guidelines as the cornerstone for stroke prevention in patients with AF.

• Warfarin significantly reduces the risk for ischemic stroke; newer anticoagulant agents have shown even greater reduction of stroke risk compared to warfarin.

• Although AF risk increases with age, this present study shows that anticoagulation therapy is underutilized in Medicare beneficiaries who have nonvalvular AF (NVAF), resulting in an increase in ischemic strokes.

• These findings suggest the need to follow guideline-based anticoagulation recommendations in patients with NVAF to prevent strokes and the associated excess in healthcare costs, reduced quality of life, and even death.

• These findings also raise the need to investigate provider compliance with clinical guidelines regarding oral anticoagulation therapy for stroke prevention in older patients (aged >65 years) with NVAF.

A copy of the entire study can be read here.

Winghan Jacqueline Kwong, of Daiichi Sankyo Inc. also co-authored the study.

Medicare, Research anticoagulation, atrial fibrillation, Bruce Pyenson, Jonah Broulette, Kate Fitch, Kosuke Iwasaki, Medicare, Medicare Part D

Risk-based managed care is the current platform from which Medicaid recipients receive healthcare benefits, at least in part, in more than 30 states in the United States. Managed care organizations (MCOs) of all varieties contract with state Medicaid agencies to deliver and manage the healthcare benefits under the Medicaid program in exchange for predetermined capitation revenue.

The primary purpose of this report is to provide reference and benchmarking information for certain key financial metrics used in the day-to-day analysis of Medicaid MCO financial performance. The financial results are summarized on a composite basis for all reporting MCOs. Additionally, this report explores the differences among various types of MCOs using available segmentation attributes defined from the reported financial statements.

Download and read the entire report here.

Medicaid, Research Healthcare, Jeremy Palmer, managed care, Medicaid

The Society of Actuaries (SOA) has selected Milliman to complete the data compilation for the latest cancer experience study in order to support the development of new cancer valuation tables. These tables will be presented to the National Association of Insurance Commissioners (NAIC) for adoption as the standard for setting reserves for cancer policies.

The objective of this project is to receive and summarize detailed cancer claim data from 2001 through 2011 from approximately 10-20 insurance companies. The desired end result is a comprehensive database of cancer claim costs aggregated along relevant factors such as age, sex, single vs. family, product type, and other product groupings.

Milliman will create coding routines that will analyze and validate the data to ensure that the submissions are logically consistent and that the values given are within the ranges expected for the product. Additional routines will be developed to calculate exposure and incidence rates in order to determine the final claim costs.

The current cancer valuation tables were publishing in 1985 based upon cancer experience from 1978 thru 1980. The evolution of cancer treatment over the past 30 years has rendered the 1985 Cancer Tables outdated. The results of this experience study will be used to develop a new set of tables that will replace the 1985 tables.

It is currently estimated that the companies participating in the study will represent approximately 70% of the U.S. cancer insurance industry. Data compilation of the study is targeted for late 2012. The proposed valuation table is to be presented to the NAIC in 2013.

Research Cancer, SOA

Milliman has been selected by the Society of Actuaries (SOA) to conduct an extensive research study on accountable care organizations (ACOs). The goal is to identify more actionable benchmarks for an ACO to assess its performance by looking at episodes of care rather than the traditional actuarial view of benchmarks based on types of services.

Wide variation currently exists in costs per patient for numerous episode types. Many factors contribute to this variation, including differences in regional provider pricing, clinical practice patterns, and the underlying risks of the patients included in the sample. While many studies have examined the variation in per-episode costs related to price and practice differences, all struggle to normalize costs per episode across populations with different levels of underlying risk. We will be developing methods to address this need.

Read more…

Research ACOs

Bruce Pyenson presented his study on lung cancer screening at Health Affair’s “Value in Cancer Care” briefing on April 12 in Washington DC. Watch his presentation at HealthAffairs.org – scroll down to “The Case For Lung Cancer Screening of High-Risk Patients & Improving Payment And Delivery Of Cancer Care.”

Also, here is the study’s abstract:
Read more…

Actuary, Prevention, Research Bruce Pyenson, Cancer, Prevention

Milliman launched the 2009 Milliman Medical Index (MMI) today. We’ll be blogging about the results all week. Today, we look at the disparity in health costs across the country. The MMI analyzes 14 metropolitan areas and offers the average cost of care for a typical family of four in those areas. Here is how this year’s costs break down across those 14 areas.

Note the range. Miami is the first city in the history of our research to surpass $20,000 in average health costs for a family of four; it is also one of three cities (along with New York at $19,684 and Chicago at $19,008) that is more than 10% more than the national average of $16,771. Meanwhile Phoenix is still below $15,000 ($14,857 to be exact), joining Denver ($16,517), Atlanta ($15,979), and Seattle ($15,564) below the national average.

Cost, Research geographic cost disparity, Milliman Medical Index

We have heard much talk recently of “stress tests” for financial entities. What would a stress test of the healthcare system reveal? Are we ready to withstand a major health event?

The question becomes more immediate in light of news this week out of San Diego, where two children were diagnosed with swine flu. There are reportedly other cases confirmed in Mexico.

Is the US healthcare system ready for a pandemic? The difficulty of managing through such a crisis is outlined in a piece by Phil Borba, Kate Fitch, and Bruce Pyenson.

Pandemic, Research bird flu, Bruce Pyenson, epidemic, Kate Fitch, Pandemic, Phil Borba, stress test, swine flu

According to the New York Times, the cost of developing new pharmaceuticals in some cases is outpacing the ability of insurance to cover these high-cost treatments. This is especially problematic with chemopreventive cancer drugs, and organizations like C-Change have given some thought to how to address the payment issue.

Milliman principal Bruce Pyenson has studied chemopreventive drugs and suggests that a new pharmaceutical reinsurance scheme could help fund the development of these treatments and also spur innovation.

Cancer, Cost, Reinsurance, Research BioRe, Bruce Pyenson, Cancer, chemoprevention, pharmaceutical reinsurance

The latest post at The Health Care Blog features an article by Bruce Pyenson, Kate Fitch, and Sara Goldberg about their recent healthcare reform report, “Imagining 16% to 12%,” which provides an actuarial yardstick for health reform proposals and efficiency targets for the US healthcare system.

Cost, Economy, Efficiency, Electronic Health Records, Evidence-based Requirements, Fragmented system, Portablity, Reform, Research 16 to 12, Bruce Pyenson, Efficiency, Kate Fitch, Sara Goldberg