Archive | October, 2007

Can Health Consumers Vote With Their Feet?

October 6, 2007 by George Van Antwerp 1 Comment

If you can’t satisfy multiple buyers, does the company buying health insurance matter more than the consumers?  It’s a difficult question.  The employer cares about the average employee being happy with the health benefits.  You can’t design it for everyone.  And, since we can only switch insurance on annual enrollment (or other life events such as marriage), you [the consumer] can’t do much immediately.

feet  Over time, consumers can vote with their feet especially at companies where multiple insurance offerings exist.  This takes away some consumer power since you can’t storm out saying that this horrible customer service means that I am going to stop using you.

Does this affect service attitudes?  I certainly think so.  I saw it on TV several weeks ago in a sitcom, but I believe it is prevalent.  In that case, the CSR (customer service representative) basically told the person challenging the claim to terminate their coverage if they don’t like it.

call center  Since the consumer is often not the buyer or influencer of the corporate decision, this is an unfortunate reality.  Maybe we need another “life event” to be poor customer service.  When this happens you can change carriers.

Of course, the company arguement would be that this complicates underwriting and raises costs, but why not simply tie customer satisfaction to their pay.  The only way consumerism really works is where the consumer has the ability to walk away.

Interestingly, for one of our biggest customers at a past employer, we got paid cost with a bonus payment that was tied to patient satisfaction.  It was risky, but it put the right pressure on to make sure the patients were satisfied.

Consumerism, Healthcare, Managed Care

Survival Guide for the Uninsured

October 5, 2007 by George Van Antwerp 0 Comments

This article on MSN Money has some good tips and links for things to do including:

  1. Places to go for information on free or low cost preventative care.
  2. Sites to access prescription assistance programs funded by the drug companies.
  3. Free eye exams.
  4. Going to dental schools for low cost dentist visits.

It also quotes a few scary facts from Kaiser:

  • People without health insurance receive less preventive care and are less likely to have major diseases detected early.
  • The uninsured are more likely to die prematurely than the insured, with various studies putting the mortality rate for the uninsured somewhere between 1.2 times to 1.6 times the rate for the insured.
  • Uninsured infants have relative odds of dying that are 1.5 times higher than infants with private insurance.
  • The poorer health associated with being uninsured depresses workers’ average lifetime earnings significantly. The commission estimated that better health would boost earnings by 10% to 30%.
Healthcare

Exercise Myths

October 5, 2007 by George Van Antwerp 0 Comments

I saw this article this morning on exercise myths which I thought was good.  Here are the myths (summarized):

  1. No pain; no gain.
  2. Stretching reduces risk of injury.
  3. The best time to work out is in the morning.
  4. If you’re not going to work out hard, don’t bother.
  5. Exercising the same each day is the best way to build up a muscle.
  6. Running is the best way to get in shape.
  7. Heavy weights create big muscles and small weights create lean muscles.
Healthcare

Companies from Health 2.0

October 4, 2007 by George Van Antwerp 3 Comments

I thought it was interesting to catalog the companies that were at Matthew Holt’s Health 2.0 conference. Many of which I was not familiar with.

MedHelp.org (interesting site which offers Q&A by disease topic with MDs and nurses)

ThinkHealth (medical management software)

Health Evolution Partners (a private equity firm)

Medstory (intelligent search for health)

Healia (health search engine)

Healthline Networks (health search engine)

WeGoHealth (disease specific communities)

Patients Like Me (patients sharing information with other patients)

Daily Strength (support groups)

Organized Wisdom (MD handcrafted search results)

Inspire (health and wellnes support networks)

DiabetesMine (site all about diabetes)

Enhanced Medical Decisions (uses natural language to look at drug interactions)

HealthEquity (health savings account software)

DNADirect (source for genetic testing)

Within3 (social networking tool for physicians)

Vimo (comparison shopping for healthcare)

Careseek (sharing information about physicians)

Health Hero – home health monitoring device

Additionally, John Sharp mentions a few other companies in his blog including:

Consumerism, Healthcare, Innovation, Software, Technology, Weblogs
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A Birthday Foundation

October 4, 2007 by George Van Antwerp 0 Comments

This is not really healthcare specific although I believe the health of our children (mental and physical) is essential. And, I can’t tell you much about this organization, but I like the idea.

Our neighbor is having a birthday party for their twins. Rather than give them gifts, which all our kids have too many of, they are collecting candy and other things for the Birthday Foundation. I was intrigued. What does a “birthday foundation” do?

 

The Birthday Foundation is a 501(c)3 not-for-profit organization based near St. Louis, Missouri. We provide birthday parties to children in our community who are homeless, disadvantaged, or facing medical crisis.

Seems like a great idea.  Of course, it’s sad to think that kids don’t get to celebrate birthdays, but it’s nice to have a mechanism to help.

General Thoughts
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Healthcare Guarantees

October 4, 2007 by George Van Antwerp 0 Comments

I needed a small break so I am dropping a few things from my head to paper (i.e., blog).

Wouldn’t it be nice to get guarantees in healthcare?  I was thinking about several that would be nice to have:

  1. Pay one price and get unlimited fertility treatments until they were successful.  (BTW – I have a physician friend who did offer this based on data knowing that most people were successful after 2 attempts and selling it for the price of 2.x attempts.  As long as you don’t take customers that have health problems, you should be good.)
  2. Pay one price to get diagnosed for a medical problem versus multiple office visits, numerous lab copays, and trying different medications.
  3. Obesity plan of diet, exercise, and drugs that lost weight or you got your money back.
  4. Quality guarantee (which I talked about before) on things like surgery which promise certain outcomes (or not getting some staph infection).

The key should be that we (consumers) don’t have to take risk (or only take calculated risks) when we make decisions that are presented to us by our care team and insurance company.  Healthcare is still not perfect, but it seems ridiculous when I talk to people that spend months trying to figure out what is wrong with them.  (Discovery Health had a scary story about a patient with lime disease on TV a few weeks ago.)

Healthcare

Top Marketing Blogs

October 4, 2007 by George Van Antwerp 0 Comments

I think this is a good list of top marketing blogs.

http://adage.com/power150/ 

Marketing / Communications, Weblogs

Can You Answer These Questions (healthcare company)?

October 4, 2007 by George Van Antwerp 0 Comments

These are more company focused although you can think about whether your healthcare company knows this about you.  To be truly effective at education or marketing to patients to drive behavior and outcomes, these are important.  Interestingly, I am not sure I (or you) could answer all these questions about myself (or yourself).

  1. What is your preferred medium – letter, call, fax, e-mail, text message?  And, does this vary based on the content?
  2. When is the best time to reach you?
  3. Would you prefer to talk or hear information delivered in a female voice or male voice?  Would you react differently if they had an accent?
  4. What would compel you to act – saving money or losing money?  Is there a specific amount?
  5. What makes you open an envelope?  (For example, we used to places stamps on intentionally crooked since people were less likely to think they were from a company.)
  6. Does color matter in materials?
  7. How many times do you need to hear a message before you respond or do you make up your mind the first time?
  8. Do you want to be healthy or simply minimize out-of-pocket costs?
  9. Do you trust physicians, pharmacists, insurance companies, hospitals?
  10. What information do you want to receive that you don’t?

I could go on, but I think the point is that today we (healthcare) don’t really understand patients.  What information they want, how to get it to them, when to deliver it, what makes it more effective, and how to drive action.  On the other hand, we may not know ourselves until “experimented” on with different variables.

Consumerism, Healthcare, Managed Care, Marketing / Communications, PBM / Pharmacy

Confusing Stock Market Reaction

October 4, 2007 by George Van Antwerp 0 Comments

So, Walgreens announced that they were going to miss earnings because of generics (oh and higher expenses).   All of a sudden, the PBM stocks (e.g., Medco and Express Scripts) took a hit which makes no sense to me.  [BTW – I own none of these individual stocks although they may be in mutual funds that I own.]

Walgreen Co., one of the nation’s biggest drugstore chain operators, said Monday its fourth-quarter profit dropped nearly 4 percent because of lower reimbursements for some popular generic drugs and increased store and staff costs.  (See all)

“If Walgreen is receiving lower reimbursement for some generics, it means that PBMs are paying the company less for generic drugs,” Wachovia analyst Matt Perry surmised on Tuesday. “In other words, the PBMs’ drug purchasing costs have gone down. We think the selloff in shares of Medco and Express Scripts is unwarranted.” (see entire article)

At least one analyst understood.  But, why would the market response this way.  There are only a few reasons that these could be correlated positively.  My hypothesis would have been that if Walgreens is getting less than the PBMs are making more or are neutral.  This would make sense because if the PBMs paid Walgreens less they wouldn’t immediately pass that on to their clients assuming they make spread on those claims and have multi-year contracts with employers and managed care companies.  And, if they simply passed on the retail costs to their clients, it would have no impact on them.

How could it be true that Walgreens and the PBMs made less?

  1. The acquisition cost of generics could have gone up which would likely only happen if the wholesalers (e.g., McKesson or Cardinal) changed their prices dramatically or the generic manufacturers increased their prices (not likely).
  2. A significant number of PBM clients (or major managed care companies with their own PBMs like Aetna, Cigna, Wellpoint, Humana) requested price concessions on generics which forced the reimbursement rates down for the retail pharmacies and the mail order pharmacies.  (possible, but clearly not what you hear from the other players)
  3. Costs for a specific generic (with material marketshare) changed dramatically from what was forecasted (shame on the planner).  The worse case here would be if they struck a sweetheart deal (i.e., guaranteed supply at a lower than market price) and then saw the price drop out with a new manufacturer come to the table.

Generics are definitely a key profit driver for the pharmacy industry.  The average AWP (average wholesale price) is $40 (for a 30-day supply).  Companies pay less than 50% of this.  The actual costs are typically less than 80%.  And cash customers pay greater than 100%.  Lots of spread.

Now, of course, there are costs to fill each prescription so it is not that simple.

General Business, Healthcare, PBM / Pharmacy
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Unified Communications

October 2, 2007 by George Van Antwerp 0 Comments

Those of you that know me (or follow the blog) know that one of my key issues is how to improve healthcare communications.  I think this is where we (as an industry) missed the boat.  I used to tease our VP of Call Centers that Dominos knew more about me when I called in than we did.

I was glad to see a blog entry from earlier this year by the physician that leads Microsoft’s healthcare group on this topic.

“Healthcare is a communication intensive business.  Good communication has a profound effect on the quality and safety of patient care.  Communication also has a huge bearing on patient satisfaction.  Yet historically, the options for how we communicate with each other in the healthcare industry have been somewhat limited.” 

Obviously, we have a long way to go.  Many times companies simply give up due to regulatory issues or the challenges of changing behavior.  The reality is that communications are difficult.  It is both an art (i.e., messaging, branding, design) and a science (i.e., linguistics, data mining, targeting, personalization).

Technology will drive a step change in the relationship between patients and providers and insurance companies.  This is the time to jump on board and figure out how to improve.

Healthcare, Managed Care, Marketing / Communications, PBM / Pharmacy, Weblogs
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Does Technology Affect Awareness?

October 2, 2007 by George Van Antwerp 0 Comments

I remember when they first started letting us use calculators in school.  At the time, there was lots of discussion about whether this would impact people’s math skills.  I don’t hear much about this anymore.

But, if I think about it, there are many things I ignore because of technology.  I probably only know about 3 people’s phone numbers since they are all in Outlook and synched up with my Blackberry. 

What are the implications of consumer technology on our health awareness?  Once all my prescriptions are tracked in a PHR, will I forget what drugs I am on?  And, even if I do, do I care?  I don’t think I do as long as the PHR (or whatever tool) is always available to me and my care team. 

I certainly use a calculator today.  I depend upon my crackberry.  I can’t remember all my statistics since I can use Excel to calculate them and press help to find out what it means. 

But, literacy about healthcare and the ability to talk in a group (virtual or physical) about my condition or that of someone I care for is important.  I will certainly use technology as my crutch to store and remember information.  I only wonder how this will affect our long-term attitudes on health as things become abstracted. 

Consumerism, Healthcare

Regional Differences

October 2, 2007 by George Van Antwerp 0 Comments

I remember one of the first thing that healthcare peope used to tell me 10 years ago when I first began working in healthcare.  “Healthcare is local.”  At the time, I took this for granted.  Since then, I have seen all the data that shows how prescription utilization, spend per person, obesity, and many other variables vary by geography.

As I have been traveling, I was thinking about this as I noticed lots of anxillary things that vary dramatically state-to-state:

Boston and some eastern states have Dunken Donuts everywhere.  They went out of business in St. Louis.

In Michigan, everyone drives faster than any other state I have been in.  The other day, I was going 90 in the left hand lane and got waived out of the lane by a minivan and an SUV going about 100. 

In LA, people consider an hour drive nothing.  In some smaller areas, a 30 minute drive wouldn’t be considered for some normal task. 

Yet, from what I can tell, many national companies don’t vary their healthcare marketing and communications per region.  Why is that?  Is it simply a data sophistication question?  If attitudes are going to vary, have you taken that into account?

It makes me think of a project I did with a retailer years ago.  One of their questions was about stocking inventory and how to develop a model to optimize the mix based on location.  They had just gone through a season where some stores had excess shorts which they had to dramatically discount and some stores that ran out of shorts.  At the time, WalMart had just begun their CFAR (Collaborative Forecasting and Replenishment) initiative which created an integrated application for sharing data across stores and with suppliers to optimize mix and maximize inventory turns. 

That CFAR model has now become a default SAP module and created an industry association that uses the model.  Will healthcare do the same?  Not for a while from what I can see.

But, it is critical in communicating.  Attitudes towards preventative care vary.  Willingness to try and exercise and wellness vary.  Perceptions vary.  The most simplistic example I saw a few years back was the doubling of the success of a call campaign when the person calling [into the South] had a southern accent.  People weren’t as responsive without that familiar accent.

The website for Premier (a non-profit hospital association) had some good facts about localization (pros and cons):

“All healthcare is local”: Good for innovation and personalization of care

  • Widespread, local experimentation among U.S. healthcare providers prompts innovation, which as New York Times columnist, Tyler Cowen points out, makes the United States the world leader in new treatments and technologies. Innovations include the development of new drugs and devices and better treatment protocols.
  • The U.S. healthcare system is anchored by community hospitals and healthcare organizations. These local hospitals and organizations are rooted in the community and are able to shape care in accordance with the needs of their specific populations, making healthcare more personal and direct.
  • “Community-based approaches act as a reality check of what is doable and practical: They can provide an actual model of what works; they help identify promising practices in key areas; and they can provide lessons about how to address political issues.”[1]

But local orientation results in variation of care, uneven outcomes and high costs

  • In a national study on quality of care, RAND found that American adults receive just half of recommended evidence-based care services.
  • The National Committee for Quality Assurance’s recent scorecard, The State of Health Care Quality: 2006, reports huge variation in healthcare performance exists in every region of the country and in every clinical area.
  • “Despite the billions of U.S. tax dollars spent on research and the more than a trillion spent on service delivery, movement of evidence-based interventions into communities and health systems is often slow.”[2]
  • Lack of scale and connectedness (“buying clout”) and unnecessary duplication result in high healthcare costs.

[1] Debbie I. Chang, “Applying Lesson Learned in Communities To Programs and Policies at the Federal Level,” Health Affairs 25, no. 3 (2006): w192-w194.

[2] Jonathan E. Fielding and Peter A. Briss, “Promoting Evidence-Based Public Health Policy: Can We Have Better Evidence and More Action?,” Health Affairs, 25, no. 4 (2006): 969-978.

Healthcare, Marketing / Communications
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Health 3.0 – Ubiquitous Transparency

October 1, 2007 by George Van Antwerp 0 Comments

I was thinking about dieting over the weekend and thought back to an idea I had many years ago.  The concept then was to create a data integration layer for the smart house that integrated the data from your multiple devices.  Imagine the following:

You set a diet plan.  Your virtual health coach (think artificial intelligence) looks at your daily calendar and the food you have at home.  It proactively recommends what you should eat at the restaurant you are going to for lunch; orders a few items from the grocery store to be ready for pick-up on the way home; prints out the cooking instructions; and pre-heats the oven when you are 5 minutes away from home. 

Over time, it plots your caloric intake and suggests workouts based on your calendar and biorhythms. 

If I expand this concept, I would see this as a Health 3.0 type application.  Total integration of data (home, work, health).  Total transparency of information (healthcare, lab, medical, cost, quality, consumer goods).  And, availability of information anywhere and anytime.

I am sure there are definitions, but I think about Health 1.0 and Health 2.0 as the following:

  1. Health 1.0 was several things – workflow oriented applications (e.g., practice management systems), e-prescribing, online content (e.g., WebMD), and transaction hubs.  I saw the focus here on efficiency, quality, and connectivity.
  2. Health 2.0 is still developing and includes transparency and web tools.  I see the focus here on pushing information from companies into the hands of consumers. 

Surprising (or maybe not), there are several people using the term Health 3.0.  Here were a few things I found:

  1. Money magazine article about home monitoring and companies like Health Hero, NxStage, iCare, and CareMatix.
  2. This link which talks about the semantic web but has little other information.
  3. An article about the Health 2.0 conference which mentions Health 3.0:
    • Things start to change when the institutions don’t control all the information. Even though the largest flow of money will still be centralized and often mis-directed, the new user tools will make all the tangles more visible.

      At that point, the Health 3.0 conference will have to include folks from the establishment – government, large software vendors and entrenched health-care institutions.

 Who knows when and where Health 3.0 will really appear, but I generally disagree with the opinion that Health 2.0 isn’t real because there aren’t business models.  In the early dotcom days, the business models were limited.  Those that figured them out – WebMD, Amazon, eBay – survived.  First you figure out the concept and the value add.  Then, you figure out who can pay for it. 

Healthcare, Innovation, Technology
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