Controlling claims costs

David Healy describes how the more innovative providers in the international private medical insurance (IPMI) industry are tackling claims-related costs through hands-on management and health partnership techniques

In the ongoing drive to improve health outcomes and lower claims costs, some insurers are actively partnering with their customers to help them lead healthier lives. This approach can deliver significant benefits to both policyholders and insurers and can be delivered in a number of ways, including adjusting approaches to care management, developing wellness programmes and creating bespoke healthcare benefits programmes for specific customer populations. The below article investigates how promoting health among members can help contain medical costs.

Active management

Innovative insurance providers have found that playing an active role with their members in helping to manage cancer and other complex medical cases can lead to improved patient outcomes. Often, active management means overseeing the co-ordination of care to ensure that a patient’s many healthcare providers are working together for the best health outcome. Insurers with the capacity and expertise to help co-ordinate care can monitor treatment plans and intervene where treatment plans contradict or duplicate each other. The goal is to ensure patients receive the appropriate care for their condition and for the optimal period of time. 

Planning around the point of discharge is also important, both for the patient and cost control. When patients have a full understanding of their post-discharge treatment plans and can receive the appropriate care at home, the insurer can minimise hospital re-admissions.

A further consideration is the management of final-stage patient care. Often, the majority of care costs are incurred in the last six months to a year of a patient’s life. Through programmes like Aetna’s Compassionate Care Programme (CCP), insurers can help patients to have more control over the care they receive at one of the most difficult times in their lives. Nurses work with physicians and help members and their families understand the options available for end-of-life care. They, often, are the people smoothing the member's transition to hospice care when that is what the member chooses. These programmes also identify resources to make members as comfortable as possible, addressing pain and other symptoms, and help co-ordinate medical care, benefits and community-based services. Member satisfaction rates are over 90 per cent on our CCP, and it has significantly reduced the number of acute hospital stays, intensive care days, and emergency room visits.

Disease management

Patients with chronic diseases such as asthma, heart disease and diabetes can also benefit from insurer management and intervention. In these instances, much of the insurer’s role is focussed on educating the patient about the disease and how they can best manage it by carefully following treatment plans and making appropriate lifestyle changes. 

When patients have a full understanding of their post-discharge treatment plans and can receive the appropriate care at home, the insurer can minimise hospital re-admissions

Several years ago, Aetna ran a care-management programme for the UK’s National Health Service that focussed on chronic conditions. The results were stunning. The active case management slowed the rising cost of urgent admissions by nearly 40 per cent and achieved a 90 per cent patient-satisfaction rate. Over a three-year period, more than $600,000 was saved. What is more, the impact on emergency, outpatient or primary care activity yielded an additional 10 to 30 per cent in savings.

Second opinions

A second opinion can be of great value, especially in a complex medical case.  Difficulties can arise where the nature of a case means the recommended treatment plan is not clear cut. Bias may also occur if a consultant specialises in a particular area. To prevent these situations happening and to provide peace of mind, second opinion programmes enable customers to seek the advice of another consultant.

Seeking a second opinion can reassure a patient, either confirming the current treatment path or suggesting a more appropriate one. This can also result in cost savings in cases where first-phase treatment is not warranted.

Preventative care and wellness

Health prevention strategies come in a number of different guises. Many innovative insurers focus on five key areas: smoking cessation, stress reduction, weight control, diet management and exercise.

The aim is to educate members about how these areas can affect health and provide support through information about the improvement strategies available. Using a new technique in behaviour modification called motivational interviewing, our health coaches have had success helping members identify habits or behaviours they want to change and nurturing their motivation to take the small steps that can lead to healthier living.

Wellness strategies for an employer’s workforce and other populations can be extremely effective over the long term. It’s often helpful to think of a wellness strategy as having two complementary parts. The first consists of efforts to help employees get and stay healthy, such as nutrition education, fitness challenges, smoking cessation workshops, stress reduction programmes and behavioural health sessions. Depending on the suitability for the employee population, these programmes can be site-based or virtual and feature telephonic coaching, online or mobile applications, health fairs, clinics for vaccines and screenings or financial incentives for participation.

The second category of a well-thought-out wellness strategy addresses employees’ acute and chronic health conditions. Disease management and care management programmes are important interventions to help employees with complex health needs better co-ordinate their care or adhere to their therapeutic regimens. These programmes too can be telephonic, online or in-person, using a site-based clinic or travelling nurses. 

Studies have shown that for every dollar spent on wellness programmes, medical costs fall by about $3.27 and absentee day costs fall by about $2.73.

Clinical data analysis

Data is the cornerstone of understanding, giving a deeper insight into health and claims performance. To gain this insight, some insurers invest heavily in understanding evidence-based protocols and current and future medical trends.   

Several years ago, for example, Aetna acquired a number of specialist companies in the field of data analytics and medical trend forecasting. These acquisitions provide a platform for taking ‘smart’ decisions – referred to internally at Aetna as ‘clinical decision support’.

The upside of clinical decision support cannot be understated. It allows faster and more accurate assessments of employee populations and makes it easier to identify healthcare trends within employee
sub groups.

For example, the analytics can identify increases in population weight or levels of stress in a given employee group. The employer can then implement a targeted health and wellness programme to tackle these issues. The result is healthier and better performing employees, benefitting individuals, the employer and the insurer through a reduced incidence of claims.

Prospective claims reviews

Data also has an important role to play in tackling fraud. Insurers want to be certain that claims settlements are reasonable and relate to treatment that has actually taken place. Sophisticated analysis can help insurers assess circumstances in line with population data trends. Claims can be analysed, for example, in various stages of the payment cycle to detect over-charging, inappropriate levels of treatment or fraud. 

Robust analytics can help insurers pinpoint irregularities and identify specific claims that require further investigation. By using data in this way, insurers are able to allocate investigative resources more efficiently, focus on genuine problem areas and reduce claims costs over time. 

Pre-authorisation

Pre-authorisation enables all parties – the patient, medical facility and insurer – to be more aligned from a care and cost perspective. By allowing the insurer to maintain close contact with the patient and treatment plans, pre-emptive action can be taken early in the process to prevent excessive or unwarranted treatment. 

Pre-authorisation also ties in closely with case management. If a client has a serious condition that requires heart surgery, for example, the pre- and post-treatment periods can be managed by the insurer to ensure patients prepare properly and follow treatment plans carefully. 

Care management post-treatment allows input into the rehabilitation programme, giving the client the best chance of a positive outcome and minimising complications and hospital re-admissions. Patients who understand post-care instructions more thoroughly will benefit from a faster recovery. This, in turn, helps keep costs to acceptable levels.

Using a new technique in behaviour modification called motivational interviewing, our health coaches have had success helping members identify habits or behaviours they want to change

Most insurers require in-patient treatment to be pre-authorised, but the more complex the case – such as those involving surgical procedures, high-risk pregnancies or serious psychological incidences – can benefit the most from a provider’s involvement. 

Network discounts

Medical networks can be made up of thousands of institutions across the world. For example, Aetna has more than 100,000 hospitals, clinics and doctors in our direct-settlement network, including both private and public facilities.

Some insurers are set up to help customers understand that the most expensive facility won’t necessarily provide the best treatment for their condition. In China, for example, many state-funded hospitals provide a better standard of care than higher-cost private facilities. Here’s where pre-authorisation and communication can play a significant role. 

We encourage our members to discuss their circumstances, where possible, with Aetna's health advisory team so that their treatment can be matched with the facility best placed to manage their condition.

Plan design

Plan design can also affect insurer costs. The programme customers choose allows them to engage in their level of care in different ways. For example, a healthcare plan with higher deductibles or excesses can motivate members to take more responsibility in managing the cost of their care. Plan design can also guide the level and type of treatment available to customers.  Hospital tiers, co-pay arrangements and cover options chosen will all have an effect on the level of treatment available and the extent of claims costs.

Insurers can work with group clients to build plans that match the particular circumstances of their workforces. If a workforce is older, for example, or work requirements rely on physical labour, the insurer can tailor the plan to best meet these needs. Plans could include specific arrangements that can reduce costs through education or adding particular medical facilities that are best suited to handling certain types of treatment.

Technology

Technology has transformed analysis and decision making within the international private medical insurance industry. Clinical data analytics mean we can now observe trends and make decisions for the benefit of employee populations and their employers. Communication has also changed. Many insurers are using innovative ways to engage with their membership base. Just as technology has revolutionised the way customers manage their banking and financial services, we see technology as the way for our members to more easily manage their health and healthcare.

Technology also allows members to choose how they want to interact with their health insurer. Some people prefer to use technology for day-to-day communication rather than talk to another human being. Apps, text messaging and micro-sites can help educate employer groups, for example, around healthy living and how to make the best use of the organisation's health insurance programme.

The key is to make helpful technology invisible so that customers can concentrate on the things that matter to them in their lives.

Recently, Aetna turned to communication technology to help a large client group of Middle Eastern students who were attending university in the US. The group, which was several thousand strong, needed help in understanding how to make the best use of the US healthcare system and how it differed from what they were used to at home. A carefully planned communication programme was set up for the students that featured text messages, a dedicated micro-site and emails to deal with the pain-points. 

Among the key messages for the group was how to identify a primary care provider rather than using accident and emergency as the first point of call for healthcare. Accident and emergency can be expensive in the US and is not always the most appropriate route. 

Maternity care was another area that needed support, with a number of high-risk pregnancies within the group. Communication included encouraging pregnant patients to contact Aetna for help and advice, which allowed the insurer to intervene early and provide recommendations on the best care path and the right facility. This improved patient care and helped control overall costs of care.

Change can happen

Claims costs are an ongoing problem for the international private medical insurance industry. Close management of treatment plans and working with patients to help them maintain healthier lifestyles, though, are strategies that have a positive impact on customers and help insurers keep excessive cost increases to a minimum.