Archive | May, 2010

Some of my notes from RESULTS2010

This week was our [Silverlink Communication’s] annual client event – RESULTS2010 (click here to see the final agenda). I’ve talked about this before as one of the best events.  It was great! Educational. Fun. Good networking.  

Here’s a few of my notes along with a summary of the twitter feed (using hashtag #results2010). Unfortunately, the two of us twittering were also fairly involved so there are some gaps in coverage. And, my notes are sporadic due to the same issue.

Overall themes:

  • Communications are critical to driving behavior change.
  • We have to address cost and quality.
  • Reform creates opportunity.
  • Systemic problems require systemic solutions.
  • Measure, measure, measure.
  • Automated calls – while not the whole solution – work in study after study.
  • People are different.
  • There is a gap in physician – patient interactions. 


  • Reform basics – guarantee issue, requirements for coverage, income related subsidy.
  • Independent payment advisory board has an aggressive goal – get Medicare spending to equal GDP growth + 1% each year.
  • ½ of the $1 trillion needed to pay for health reform comes from Medicare savings / reform…the rest from taxes.
  • Everyone’s fear is that MCOs become “regulated utilities” that just process claims…unlikely.
  • Need to address underuse, misuse, overuse, and limited coverage.
  • Need to measure quality and cost at the person level.
  • CMS pilots around shared savings are working – outcomes improved.
  • Medicare Part D only got one complaint per thousand for therapeutic interchange programs / drug switching.
  • The decision around defining MLR (medical loss ratio) and what fits in there is critical.
  • Healthcare is like anything else…it’s not great and needs to change, but don’t touch mine cause it works ok. [frog in the pot]
  • How do we make each healthcare decision an informed decision.
  • Decision aids.
  • Pull, push, or pay – 3 ways to drive awareness.
  • Moving from information about your care to information being care.
  • The incentive rebound effect…what happens when you take away an incentive.
  • Social interaction affects our behavior.
  • Solving for how to change consumer behavior cost effectively and in a sustainable manner is a good challenge to work on.
  • How do we move people from desires to action? From “I’d like to exercise” to actually doing it.
  • The fact that some European programs take 3-5 years to see an impact makes me wonder what that means for our US investment strategy given the member churn across plans.
  • Great examples of ethnographic interviews
  • Good McKinsey data on people’s perceptions – Annual Retail Healthcare Consumer Survey.
  • Inform / Enable / Influence / Incentivize / Enforce
  • One way of categorizing – willingness to change versus barriers to change (rational, emotional, psychological).
  • Attitudinal segmentation – cool…but how to scale?
  • Provider staffs attitudes are important.
  • Design – delivery – measurement
  • Readiness to coach
  • A culture of health
  • Have to mix up your tools (incentives, channels)
  • “Communication Cures”
  • The chief experience officer is a new role in plans and PBMs.
  • The only experience you have with health insurance is via communications. Make it count.
  • Loyalty is a result of cumulative experiences.
  • People have to trust you so they listen to your message
  • Communication maturity model
  • Price is what you pay; value is what you get. (Warren Buffett quote…he wasn’t there)
  • Shifting paradigms:
    • Consumption to sustainability
    • Possessions to purpose
    • Retirement to employment
    • Trading up to trading off
    • Perceived value to real value
  • Simple…less is more
    • 1/3 of people feel their lives are out of control.
  • Inflamation causes 80% of diseases (really)?
  • If only 10% of outcomes are driven by costs, why do we spend 100% of our time trying to fix that problem. [tail wagging the dog] [It’s the same point on adherence.]
  • There are 45M sick days per year from 5 conditions – hypertension, heart disease, diabetes, depression, and asthma.
  • Have to look at clinical efficacy and elasticity of demand.
  • Commitment, concern, and cost.
  • Five components – plan design, program, community, communication, and provider engagement.
  • Need a multi-faceted approach to create a culture of health.
  • MDs much more likely to talk about pros than cons.
  • There would be 25% less invasive procedures if patients fully understood the risks.
  • Foundation of Informed Decision Making
  • Huge gaps in patient view versus physician views around breast cancer.
  • Preference-sensitive care
  • Dartmouth Atlas
  • Genomics tells you the probability of being on a disease curve, but not where you are in the potential severity.
  • Only 60-70% of women get at least one mammogram their entire life.
  • Statin study – barriers to adherence:
    • 37% didn’t know to stay on the Rx
    • 27% side effects
    • 15% convenience
    • 15% MD instructions
    • 11% cost
  • In healthcare, we’re all taught to speak a language that no one else understands.
  • It takes a village.
  • Challenge – Use communications to cure cancer.
  • Collaboration. Innovation. Evaluation.
  • Adherence is a great example of where everyone’s interests are aligned.
  • There is no magic bullet for adherence.
  • You need a multi-factorial approach to address adherence…Physicians are rather ineffective at addressing adherence.
  • Evidence-based plan design works to impact adherence (although I think another speaker said no).
  • You have to think about operant conditioning. (Look at dog training manuals and kid training manuals – very similar)
  • Think about all the failure points in the process.
  • What is the relative value to the patient.
  • Reward system has to reward at the failure points not just at the end of the process.
  • Using a point system successfully increased the use of a select (on-site) pharmacy by 57% at one employer.
  • 75% of PBM profits are from dispensing generics…that’s why Wal-Mart was able to be a threat to the industry.
  • Drugs only work in 20-80% of people.
  • There are people with a gene that doesn’t break down caffeine.
  • 3% of people are ultrafast metabolizers of codeine (which turns to morpheine in the body)…that can be a problem.
  • Epigenetics – turning DNA switches on and off.


Rebecca from ProjectHEALTH closes #results2010 with a remarkable talk on this crucial program; they work with 5,000 families/year.

Reid Kielo, UnitedHealth: 93% of members validated ethnicity data for HEDIS-related program using automated telephony #results2010

25% of Medco pt take a drug with pharmacogenetic considerations. Robert Epstein, CMO Medco #results2010

Bruce Fried: the “California model” of physician groups facilitate efficiencies that improve delivery; an oppty for M’care #results2010

Bruce Fried on Medicare: 5 star ratings have strategic econ. importance, med. mgt. and cust serv. key #results2010

Fred Karutz: members who leave health plans have MLRs 2 standard deviations below the population. #results2010

Fred Karutz: Market reform survival – retain the young and healthy #results2010

Poly-pharmacy has negative impact on adherence. #cvscaremark

1 in 3 boys and 2 in 5 girls born today will develop diabetes in their life. SCARY! #results2010

20% of all HC costs associated with diabetes. #results2010. What are you doing to manage that?

Messages to prevent discontinuation of medication therapy far more effective than messages after discontinuation. CVS #results2010

25-30% of people who start on a statin don’t ever refill. #CVSCaremark

Maintenace of optimal conditions for respiratory patients increased 23.4% with evidence-based plan design. Julie Slezak, CVS. #results2010

Value-based benefits help control for cost sensitivity for medications; every 10% increase in cost = 2% – 6% reduction on use. #results2010

Pharmacists who inform patients at the point of dispensing are highly influental in improving adherence. William Shrank #results2010

The game of telephone tag in HC is broken. Pt – MD communications. #results2010

37% of Pts were nonadherent because they didn’t know they were supposed to keep filling Rx. #results2010

Last mile: 12% of Americans are truly health-literate; they can sufficiently understand health information and take action. #results2010

Only 12% of people can take and use info shared with them. #healthliteracy

We need to improve the last mile in healthcare… clear, effective conmunication. Jan Berger #results2010

#McClellan used paying drug or device manu based on outcomes as example of “accountable care”. #results2010

72% of those with BMI>30 believe their health is good to excellent; as do 67% of those w/ chronic condition. #McKinsey

Are incentive systems more likely to reward those that would have taken health actions anyways (i.e., waste)? #McKinsey

Only 36% of boomers rate their health as good to excellent. #results2010

27% of people believe foods / beverages can be used in place of prescriptions. #NaturalMarketingInstitute

Why do we spend so much time on impacting health outcomes thru the system when that only explains 10%. #Dr.JackMahoney #results2010

Using auto calls vs letters led to 12% less surgeries & 16% lower PMPM costs in study for back pain. #Wennberg

MDs are much more likely to discuss pros with patients than cons. #Wennberg

Should physicians be rewarded as much for not doing surgery? How do economics influence care decisions? #results2010

Physicians were 3x as concerned with aesthetics than breast cancer patients in DECISIONS study. #results2010

Fully-informed patients are more risk-averse; 25% fewer of informed pts in Ontario choose angioplasty. #results2010

Patients trust physicians over any other source (media, social connections) but only receive 50% of key knowledge. #results2010

Informing Patients, Improving Care. 90% of adults 45 or older initiate discussions about medication for high BP or cholesterol. #results2010

What is #results2010? #Silverlink client event.

#results2010#Aetna Medicare hypertension program leads to 18% moved from out of control to in control using auto calls (#Silverlink) …

About 2 of 3 medicare pts have hypertension. #results2010

John Mahoney describes how he connects payors, providers, and care via research. #results2010

As information becomes commoditized in healthcare, sustainability enters the vernacular. #results2010

Segmentation innovations of today will be tomorrow’s commodities. Measurement and learning must be “last mile” IDC insights #results2010

Plans are strategically investing in bus. intel to reach wide population for wellness, not just the low-hanging fruit. #results2010

The single most significant future market success factor is measurable results. Janice Young, IDC Insights. #results2010

Knowing our attendees’ preferences could have fueled segmented, precise invitations to #results2010. Dennis Callahan from Nielsen Media.

Drivers of those sereking alternative therapies: stress, lack of sleep and energy, anxiety, inflammation. #results2010

Only 2% of people don’t believe it’s important to lead a healthy lifestyle. Their behavior could’ve fooled me. #results2010

Are purity and simplicity the new consumption? Steve French of Natural Marketing Institute explores. #results2010

Gen Y is the most stressed out generation. #results2010

Less is more. 54% say having fewer material possessions is more satisfying. Natural Mktg Institute #results2010

Loyalty is a result of a cumulative set of experiences. Individual intervention ROI is sometimes difficult. #results2010

Sundiatu Dixon-Fyle of McKinsey; understand how beliefs shape an individual’s ability to change behavior. #results2010

Don Kemper: each of 300M HC decisions made each year need to be informed. #silverlink

Medicare Part D: 40% lower cost than projected, seniors covered through tiered coverage powered by communication. #silverlink

Mark McClellan: Brookings is engaging private insurers to pool data to understand quality of care. #silverlink

Mark McClellan at RESULTS2010; bend the curves, provide quality care efficiently. HC reform >> insurance reform. #silverlink

Four Interesting Job Openings

Since a few of these were brought to my attention this week, I figured I would highlight them here since I know lots of people are looking.

  1. Chief Pharmacy Officer at Cigna
  2. VP, Product Marketing at CVS Caremark
  3. VP, Managed Care / Pharmacy
  4. Business Unit Leader for Direct to Employer Disease Mgmt

Chief Pharmacy Officer – CIGNA – Bloomfield CT

Clinical Program Senior Director/Chief Pharmacy Officer 

Oversees and directs the development, evaluation and implementation of clinical pharmacy programs throughout CIGNA. Serves as the chief clinical officer for CIGNA Pharmacy Management. Responsible for establishing and enhancing functional capabilities for pharmaceutically-related health facilitation within the CIGNA Pharmacy Management offering and assures extension and integration of these activities throughout CIGNA’s entire health improvement offering. Assures the overall clinical integrity of the CIGNA Pharmacy Management offering. Retains full responsibility for establishing and executing the strategic development of a comprehensive clinical pharmacy program infrastructure to achieve CIGNA’s clinical superiority goals. Participates in the development and administration of CPM’s goals, objectives, plans, and policies. Reports to the President of CIGNA Pharmacy Management. 

• Pharmacist with active licensure required 
• Minimum of 7-10 years experience in the healthcare industry 
• Advanced degree preferred or equivalent field or work experience 
• Proven capabilities in strategic planning and large-scale project management 
• Proven implementation skills 
• Demonstrated ability to think/act strategically from a program value perspective and influence key leaders and matrix partners 
• Demonstrated ability to work in a highly matrixed environment 


Who Is Dr. Obvious?

As someone pointed out to me today, there is now a character called Dr. Obvious which is featured on the Medco site –  He’s also on Twitter and Facebook.  So, who is he?  What’s the twist here? What’s the Institute for the Incredibly Obvious?

You might get some idea by watching the video on Facebook or some of the videos on YouTube.

Here’s one on automated refills (which is the push for most pharmacies – retail and mail).


Reframing Death – A Good Example

Anyone who works in communications knows that framing is a critical concept to grasp.

Here’s a simple statistic presented two ways:

  • An astonishing 40% of people were offended by the action
  • A majority of people had no issues with the actions taken

Another great example I like is using graphics to frame things.  Here’s a picture of how much a simple drink compares to in terms of donuts.

So, I was intrigued a few weeks ago when I was at my cousin’s funeral (Fr. Tom McDevitt) by how well the priest did at framing his passing.  (You can listen to the entire podcast of the funeral here…I’d start around 16:25 if interested.)  There were several times that I wanted to pull out my BlackBerry and tweet a few things (but I thought that might be inappropriate).  The priest (or actually priests) did a great job of turning his life into lessons for all the people there and framing this out as a celebration (which it certainly felt like with 80 priests and 3 bishops there…I counted).  He talked about how he found the good in everything.  He talked about how he continued to learn.  He talked about how he kept doing things even if he didn’t feel good trusting that he would die when it was appropriate.  He talked about dealing with forgiveness and not holding grudges…it only punishes the person with the grudge.

This has always been the way my family views funerals.  It’s a time to reconnect and remember people especially in today’s day and age where families are so busy and so far flung.  But, at the same time, death is a challenge for most of us.  We miss the people that we loved and knew.  Fr. Tom had been one of the cousins that I’d stayed in touch with over the years, and he had married my wife and I and baptized one of our kids.  But, you still learn a lot about a person at their funeral.  I was amazed at all the things he did and people he touched.

It seems to surprise people, but I’ve know a lot of people that have died over the years:

  • In high school, one classmate killed himself, one friend killed himself, my friend’s brother killed himself, and my friend’s mom tried to kill him (due to her chemical imbalance).  Additionally, another guy I knew got killed in a fight…And, a kid got paralyzed in a lacrosse game and eventually died dramatically affecting my friend who collided with him.
  • When I was 30, two co-workers of mine died of brain aneurisms (who were about the same age).
  • I come from a large family and have seen 12 aunts and uncles die.  But, only one grandparent since 3 of them were dead before I was born.
  • A few years ago, a person I worked with killed themselves.
  • Another time a co-worker’s dad got shot on a hunting trip.
  • Last year at my daughter’s school, one kid died of cancer, another kid drown, and an older brother of a kid got hit by a car and died.
  • And, to top it off, I worked at a cemetary for 2 years when I was younger.

My point is that I have seen death and consider it a very normal part of life.  One of the quotes from Fr. Tom’s was “It’s a great day to live.  It’s a great day to die.”  Do you live your life that way?  Understanding and finding the value in what you do and enjoying life is important.  While I appreciate the challenge of communicating difficult information and dealing with death, I think we all have a need to think more about how to frame things and understand them.

Medco 2010 Drug Trend Report

Today, Medco Health Solutions released their 2010 Drug Trend Report (which looks at 2009 data). I haven’t had time to read the entire report, but here are a few highlights and comments from a conference call:

  • Overall drug trend was 3.7%. [They use their top 200 clients for analysis.]
    • Trend was 0.1% for clients with greater than 50% spend at mail.
    • Trend was 1.7% for Medicare.
    • [I still point out here that the question is whether trend is good or bad.] Dr. Epstein and David Snow pointed out that they work with clients on this to track metrics on adherence at the TRCs (Therapeutic Resource Centers) and report on this. The key here is knowing what classes show measurable impact to overall costs and outcomes by improving adherence and increasing costs.
    • Another point I thought was interesting was a comment that if the FDA saw the actual adherence on some drugs that require sustained utilization to achieve an outcome that they might make different decisions about drug approvals.
  • Inflation for branded drugs was 9.2% which was the highest in a decade. Generic inflation was 0.3%.
    • On a conference call, David Snow validated that this was associated with the tax on brand pharma so yes the high inflation on brand drugs was tied to reform. Someone asked a question about patent expiration (which historically drives prices up), but that doesn’t explain all the inflation here.
  • They saw a 3.4% increase in generic utilization.
  • Prescription utilization was up a minor 1.3%.
    • 5% for children 0-19.
    • 0.2% for seniors.
  • Specialty drug spending continued its rapid growth with a 14.7% increase including a 2.6% utilization increase.
  • Diabetes continues to be the largest driver of drug trend representing 16.7% of all drug spending and grew by 11.1%. [We can expect to see this continue to grow as more pre-diabetics are diagnosed.]
  • H1N1 drove up antiviral spending by 15.7%.
  • Pediatric use of medications grew faster than other groups.
  • 1 in 4 insured kids now take a medication for a chronic condition.
  • Increased utilization in kids occurred in diabetes, asthma, antivirals, ADHD, cancer, and rheumatology drugs.
    • There was a huge increase in diabetes over the decade (5x the adult population) and this was especially true with adolescent girls.
    • It’s amazing to me that you now have kids on lipids (high cholesterol), but it’s clearly an indication of the obesity issue. [We’re just at the tip of iceberg.]

  • ADHD surged for those under 35 – 9.1% increase in use leading to a 23.8% increase in spending.
    • The CDC says that 5M kids age 3-17 have and ADHD diagnosis.
    • [The other issue here is abuse of ADHD drugs.]
  • They also mention Nuvigil as a drug that could gain popularity for treating jet lag.
  • They forecast the drug trend will rise 18% thru 2012 driven largely by diabetes, oncology, and rheumatology.
  • About $46B in brand drug sales are scheduled to go generic by 2012.
  • They don’t expect biosimilars to impact the market until after 2012.
  • Not surprisingly, they showed a high correlation between states with frequent sleep deprivation and high drug utilization. As I’ve talked about many times, lack of sleep drives obesity which is highly correlated with many conditions. They also found a notable overlap of the use of Provigil (as stimulant used to treat daytime sleepiness associated with sleep apnea). [Seems like a drug that could get abused by college students like ADHD.]

“While H1N1 caused a spike in antiviral use among children last year, the far more alarming trend since the beginning of the decade is the increasing use of medications taken by children on a regular basis and in some cases, for conditions that we don’t often associate with youth, such as type 2 diabetes,” said Dr. Robert S. Epstein, Medco’s chief medical officer and president of the Medco Research Institute.  “The fact that one-in-three adolescents are being treated for a chronic condition points to the need for additional health education and lifestyle changes that can address the obesity issue that is likely a driving force behind such conditions as type 2 diabetes and even asthma.”

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Automated Call Nudge – WSJ

Yesterday’s WSJ had an article about some research done at Stanford about comparing automated calls and human interventions.  The goal was to see what motivated people to exercise more.  As you can see in the chart below, at 6-months automated calls produced better results while at 12-months they were below the human interventions.  But, an automated solution is obviously much more cost efficient and scalable.  The one big question I have is how to make the automated calls even more interactive.  There are lots of things we do at Silverlink to use automation to drive behavior.

While many are skeptical, the reality is that automated calls are the best channel in healthcare based on the cost per success ratio.  [Do you know any other channel that can get you a 70% “open” rate?]  You can deliver PHI.  You can track interventions for audit purposes.  You can have real-time access to data.  You can create rules based solutions that dynamically change based on interactions. 

And, this is not the first study Stanford has done on this.  Here’s links to two older studies they did:

Who’s Your Date To The Genetic Testing Prom?

Genetic testing (aka pharmacogenomics, personalized medicine) is certainly a hot topic these days.  There is lots of research around how to use the testing to manage drug spend by appropriately matching drugs with genetics at the individual member level. 

I find it interesting to see who’s going to the “prom” with whom here.  Another interesting perspective is how physicians feel about these (see survey).

  1. Medco acquired DNA Direct.
  2. CVS Caremark hired Per Lofberg from Generation Health and invested in the company.
  3. P&G invested in Navigenics.
  4. Walgreens was going down the path with Pathway Genomics before the FDA intervened.

So…what is Express Scripts doing?  I’ve heard some talk at a conference about their strategy which involves a broader focus on integrating data from multiple sources including genetic testing to help drive clinical decisions.  It seems like they’re either late to the party or smart in staying away.  The question is whether this is a nice to have, a differentiator, or something that consultants will start requiring the PBM to provide.  From their 2009 Outcomes conference:

[Genomics and personalized medicine]  The potential for improved outcomes and cost savings are attractive but still unproven.

Is Bad Debt In Healthcare Inevitable?

It’s an interesting question since there is quite a lot of bad debt.  I’ve certainly believed the default hypothesis which is that people can’t afford their healthcare out-of-pocket costs, but I know I’ve had several instances where I had delayed payment due to misinformation or provider billing errors that I tried numerous times to get fixed.

McKinsey’s new research suggests that I’m the norm (i.e., most people would AND could pay their bills).

  • 90% if <$500
  • 74% if <$1000
  • 62% if >$1000

Interesting Articles

On one of those rare days when I have a chance to clean my office, I figured I would post some quick things that are in my “Blog Pile”. In no particular order, here are some of the things I ripped out of magazines, printed, and/or otherwise captured and meant to write about.

Anyways, a few things you should read and look at.

CVS Caremark Split Up?

I guess I have to comment on this hot topic.  Since I’ve been an advocate since the beginning, I think my opinions are different than the masses.  Looking at Adam Fein’s blog this morning, he asks three questions:

How does patient care improve when a PBM owns a brick-and-mortar pharmacy chain? Where can a combined PBM-pharmacy chain improve performance on traditional PBM metrics? How exactly does a payer benefit when CVS increases its pharmacy market share?

1. How does patient care improve?  CVS Caremark just announced this week the rollout of their Pharmacy Advisor program (think response to Medco TRCs).  This leverages their 7,000 retail stores and their face-to-face interactions with patients to manage chronic conditions (beginning with diabetes).  Assuming this scales, it has the great opportunity to improve patient care.  AND, when they eventually roll-in Minute Clinics to this solution (which I don’t think has happened yet) there may be more opportunity.  The retail side of the company also added to their ExtraCare strategy a diabetes focus earlier this week which makes a lot of sense. It remains to be seen the effect this could have on super beta prostate.

2. Where can a combined entity improve on traditional PBM metrics?  This is a softball.  Traditional PBM metrics are GFR (generic fill rate), rebates, mail order penetration, and trend (see comments on trend).  Generic fill rate involves talking with patients about therapeutic alternatives and intervening with MDs to change the script.  A retail chain can do that and can make changes before the first fill and before the patient starts a routine.  They also have a relationship often with the MD.  Driving rebates (as a proxy for lower net cost) can happen the same way.  Mail order is a more difficult metric, but Maintenance Choice createst that option and a store with the right POS (point-of-sale) system could make a difference.  I would argue that the goal for a combined entity is to optimize the right channel for the patient.  And, since all of these lead to lower trend…a combined entity has power.

3. How does the payor benefit?  Again…a softball.  Just like a limited network (less stores), pharmacies have always offered lower rates to payors (or PBMs) in return for marketshare.  CVSCaremark could offer tiers based on marketshare to their clients (i.e., you get a 17% discount for all Rxs processed if your marketshare is 30% and you get 19% discount if your marketshare is 40%).  There are obviously fixed costs (real estate, transportation, technology, staffing) so there are incentives for store operations to optimize volume (without getting too much such that they have to hire additional staff).

Little Improvements To Healthcare Process

I saw an advertisement for a site where you could share your thoughts on improving the healthcare system.  I went to the website, but I was disappointed.  It didn’t seem to have many patient inputs.  There are huge issues for us to deal with around this many of which are wrapped up in reform (whether that’s the right answer or not).

But, if I put my re-engineering hat on from the 90’s, I think there are lots of little improvements that I would make.  Here are some thoughts:

  • Online appointment scheduling for physician’s offices.  It would be great to do this outside of normal business hours or understand the open time slots.
  • Real-time updates if the physician is behind schedule – text message alerts.
  • Kiosks at the pharmacy for picking up refills so that pharmacists could spend their time on first-fills and counseling.
  • A forum to allow consumers to create a profile about communications preferences and relevant behavioral profiling that would help healthcare companies provide them with relevant information…and allow this profile to follow them as they moved from company to company.
  • Some type of online certification for health information websites so that we knew which sites to trust for information.
  • Simpler plan information so I really knew what was covered and what my costs would be.
  • A virtual coach to help me interpret information, guide me to content, decide when to get a second opinion, provide me with pre-screening, and manage worries (i.e., do I have the flu or just a cold).
  • Online portals and PHRs that were engaging, portable, and learning systems.
  • Better communications design and literacy considerations.
  • Full genomic profiles that not only told me what I was genetically pre-disposed to but what I can do about it.
  • Aggregation of all the cool tools into a front-end where I could manage a condition thru without having to have multiple logins and different pieces of content to put together.
  • Easy to understand billing.
  • A way to stop having to repeat myself on the phone, in the office, at the pharmacy, at the clinic, etc.
  • No waiting in line – ER, Urgent Care, pharmacy.
  • Automatic, real-time suggestions (did you know there’s a generic alternative to that?  did you know the urgent care down the road 2.3 miles is open and will save you $50 compared to your ER copay?).

I’m sure I could go on, and each of these has implications.  For example, to have no waiting in line means creating more locations which creates more costs which ultimately requires them to create more demand to stay business.  A vicious cycle.

Don’t Believe The Hype – Copay Waivers

Don’t believe the hype – its a sequel
As an equal, can I get this through to you

I talk about it all the time as most people do…non-adherence to prescription drugs is a real issue.  People don’t fill their initial script.  People who do fill their first script drop off after the first several fills.  By 12-18 months after a patient starts therapy, less than 50% of them are still taking their medications.  Here’s a few key articles on this: 

Common barriers to adherence are under the patient’s control, so that attention to them is a necessary and important step in improving adherence. In responses to a questionnaire, typical reasons cited by patients for not taking their medications included forgetfulness (30 percent), other priorities (16 percent), decision to omit doses (11 percent), lack of information (9 percent), and emotional factors (7 percent); 27 percent of the respondents did not provide a reason for poor adherence to a regimen.  Physicians contribute to patients’ poor adherence by prescribing complex regimens, failing to explain the benefits and side effects of a medication adequately, not giving consideration to the patient’s lifestyle or the cost of the medications, and having poor therapeutic relationships with their patients.  (NEJM article) 

Depending on what study you look at cost is certainly an issue, but it typically isn’t the primary issue.  I typically see cost as being a factor in 5-15% of the cases.  I think if you look at how Merck weighs cost in their Adherence Estimator that it is only a small factor.  A lot of this plays out in VBID (Value Based Insurance Design) which while not purely about copay waivers that certainly is an element of most solutions.  

A few friends of mine formed their own company (CareScientific) and had a paper published in AMCP recently.  From that article: 


VBID is receiving attention as a tool to increase medication adherence and lower medical costs. However, applying a “plausibility calculation” method to data generated from a recent VBID study involving reduction of drug copayments, this evaluation found that health plan sponsors are highly unlikely to experience net savings by implementing VBID programs, even under generous assumptions, for 2 reasons. First, the price elasticities of medications are too low to generate meaningful increases in medication adherence when copayments are lowered. Second, the potential reductions in the avoidable hospitalization and ER utilization rates across a commercially insured population with varying risk levels are generally not large enough to offset the additional plan costs of lowering copayments to increase medication adherence. 

I would also suggest looking at some of their tools that they’ve developed

So, getting back to how I’m tying in my reference to Public Enemy (rap musicians)… 

When I look at the upside for pharmaceutical manufacturers to grow the pie (get more Rxs through adherence), I often wonder why one of the default solutions is to fund copay waivers.  That happens by employers, health plans, and even the manufacturers.  There are many less expensive ways to get that lift by addressing things like reminders and tailoring information to individuals based on their personalized barriers. 

There are lots of high cost solutions that will make an impact.  The question is how to triage those resources to focus them on the right people.  It’s important to identify adherence risks (pro-active intervention) and adherence gaps (retrospective) and intervene with the patient.  

Here are a few of my other posts on this: 


Do People Self Diagnose?

I think we all venture a guess on why we feel bad – cold, flu, rash.  And, at least from my perspective, that might lead to an OTC (over-the-counter) medication.  BUT, apparently 30% of people use that self-diagnosis to self-prescribe and borrow medication from friends and family.  That has some more significant risks associated with it and can lead to an incomplete medical record if something happens to you (i.e., a severe side effect). 

According to the recent survey:

  • 3/4th of those that borrowed a medication did it to avoid seeking formal medical care
  • 1/3rd of those who tried to avoid a medical visit (or 1/4th of those that borrowed a medication) ended up at the physician anyways
  • 25% of those that borrowed a medication experienced a side effect (or believed they did)

I think we all know that borrowing medications is wrong.  The only time I would think you might be okay is you were prescribed the identical chemical entity and strength and had a friend that had changed medications and had some extra.  Since the reality is that there is a lot of excess medication out there given all the non-adherence.

Could You Change Behavior With Virtual Reality?

I am a big believer in experiential learning.  To that effect, every time I’ve decided to change behavior I only have to envision myself at some future state affected by my current state decisions.  When I believed that my drinking caffeine would impact my future health, I quit cold turkey for 15 months.  (I observed no meaningful difference in health and allowed myself to drink caffeine again.)

So… I guess my question is why can’t this be harnessed in all of us.  Would we make different decisions if there was a way to reflect on our decisions in a “magic mirror” of sorts that showed us how these would impact our lives?  Is this a role for a “Future Life” play on Second Life?


  • Inputing your food decisions for a month and having it show you your weight, physical attributes, diseases, impact on your kids, etc in 10-years and do that in a 3D virtual reality environment.
  • People who smoke observing themselves thru the eyes of others and smelling the smell that others smell when the smoke is saturated into their clothes.
  • People who chew tobacco seeing what their mouth would look like in 20 years without teeth and having dentures and the things they could no longer do.
  • People who drink and drive imagining themselves in a car crash where they die and the impact that has on their friends and family.

Or, if you focus on the carrot versus the stick maybe there’s more motivation to change by letting them dream what is possible if they change behavior:

  • Running a marathon at age 70.
  • Seeing their grandchildren and being able to chase them around.
  • Being without any medications.

Service Recovery And Frontline Empowerment

Healthcare is by its nature a service business.  Your experience matters.  If you don’t get your script on time from mail order, you’re upset.  If you come back to pick up your script at retail and it requires a prior authorization, you’re annoyed.  If you have to wait to see your physician when you had an appointment, you’re upset.  If your bill is wrong, you’re upset.  If your care isn’t covered due to some loophole, you’re upset. 

But, some companies recover better than others.  And, some companies do a better job of empowering their frontline employees.  Let me just give a few non-healthcare examples to make my point.

  • Recently, I stayed at a Marriott property (which by the way is my favorite chain).  This was for personal travel, and I had reserved two adjoining rooms.  They not only didn’t have the adjoining rooms, but they didn’t even have two rooms.  It wasn’t the end of the world, but we crammed into one room.  The staff at the hotel weren’t apologetic and didn’t do anything to note their mistake.  Instead, I had to escalate it to the senior team at Marriott to get resolution.  Now, once I sent the e-mail, it was less than 12 hours before I had gotten e-mails and several calls admitting their mistake and making amends.  But, this could have been solved by the front desk staff.
  • In another case, I was at a different Marriott property a few months ago on vacation.  We also had two rooms, but only one of them was ready at the 3:00 check-in time.  The other one was only 30 minutes late, but we’d been waiting around since 11:00 to get into the room.  They immediately sent up a food snack to apologize, AND when the waiter heard my kids say “I wish they’d just brought us some gummy worms”, he was back in 10 minutes with a platter of gummy worms and other candy.  It probably cost them $5 to make us happy, and we quickly recovered from the inconvenience.

Little things do matter.  The best example in healthcare that I’ve ever heard was from a plan in the Boston area.  A spouse called up to ask some questions about a hospital bill they had recieved.  The associate on the phone realized it was for a heart surgery and asked how the patient was doing.  The woman responded that her husband had passed away and she was trying to address his finances.  The associate expressed her regrets and asked the woman to hold for a few minutes.  When she came back, they chose to waive the payment due.  I think that’s overly generous, but it makes the point.

I know at Express Scripts that we empowered many of our call center agents to be able to offer a minor (I think up to $10) coupon or waiver for inconveniences at mail order.  But, all the research shows that companies that recover from service issues are more likely to create loyalty over time.

And, I find it strange that companies don’t follow-up when loyal customers churn.  I had used Avis (for example) for well over a decade and was generally very happy with them.  About 12-months ago, they changed their inventory management model to be more real time which led to more waiting after I got to certain rental lots.  I put up with this for a few times until I was late for a meeting since they didn’t have any cars for me.  I’ve switched the majority of my business now to Hertz which while a little bit more expensive doesn’t have this issue.  But, Avis never reached out to me.

The Facebook and iPod Generation

When I think of the current generation that is coming into the workforce, I think of people who:

  • Grew up with social media all around and are less concerned about privacy
  • Grew up with the ubiquity of technology having an iPod always on and being in constant communication with their mobile phone
  • Grew up with the US in a constant state of war – 9/11, Iraq, Afghanistan
  • Grew up with the idea of constant stimulus – portable video games, TVs in the car
  • Grew up with periods of market instability – technology bubble, 9/11, housing bubble
  • Grew up with a likelihood of living at home after college [and think that’s ok]
  • Grew up with more global awareness via CNN and the Internet
  • Grew up with allergies and general paranoia – no more leaving home as a kid and coming back when the sun set or eating peanut butter at school

I think the more typical perception of many of them is an overly privileged generation who can’t focus on one thing, expect everything (money, position, title, responsibility) regardless of whether they deserve it, don’t follow basic protocols (like a thank you after an interview), have been coddled their whole life, and have no respect for what others have done.  But I think every generation thinks that of the next generation.

I guess the official definitions are: (see good presentation)

  • Traditionalists – born before 1946
  • Baby Boomers – born btwn 1946 and 1964
  • Generation X – born between 1965 and 1981
  • Millennials – born 1982 to 2000

The Millennials are also called Generation Y, GenNext, the Google Generation, the Echo Boom, or the Tech Generation and are 76M strong. With immigration they are likely to surpass the Baby Boom generation in the 2010 census. [Note – Comments derived from reading an exerpt of The M Factor by Lynne Lancaster and David Stillman in the May 2010 Delta Sky Magazine.]

Their book – The M Factor – is focused on this generation. They talk about the fact that this generation is talking about and searching for “meaning” in their work. They’ve been raised by working parents that struggled with life balance and want more out of work for their kids. They see how work has become so engrained in our lives with Blackberries and other tools.

More than 90% of US Millenials said having opportunities to give back thru their company was somewhat to very important when considering joining an organization.

51% of young workers surveyed as part of the Kelly Global Workforce Index were prepared to accept a lower wage or lesser role if their work contributes to something “more important or meaningful”.

The question that a lot of this drives at is how do you leverage the passion and tech savvy Millenials as part of your workforce. They are going to drive changes. They are going to be innovators. And, they’re not going anywhere. Here’s a good blog on Generation Y.

It reminds me of some mock interviews I did a few years ago at my business school. I was stunned by some of the accomplishments of these people. They had founded companies and businesses. They had volunteered in the community. They were well read and had passion for things that I didn’t care about at their age. I was glad to have made it thru school with my peers. But, on the flipside, I talked with my friends who are the Dean of the School and run the Career Center to point out that not one of those people wrote me a thank you or sent me an e-mail. None of them ever asked me to help them find a job leveraging my network.

The article talks about this Millenial generation growing up at a time when the divorce rate had dropped and parents spent more time with their kids and transformed from authority figures to mentors and friends of their kids. This whole concept of “helicopter parents” has been explored in other areas and still amazes me. [Are you a helicopter parent test.] For example, 11% of US Millenials said they would feel comfortable involving their parents in salary negotiations. [If I had the option legally and a parent showed up with their kid for a salary negotiation, I would rescind the offer. If they can’t do that by themselves, how can I trust them to drive my business in pressure situations?]

In healthcare, the best example I always use for a company focusing on this generation or the “Young Invincibles” is Tonik Health which is a Wellpoint brand. I’m always surprised how few people know them. Take a look at their website (below) – the colors, the words, and the positioning is all so different than how most of us think about our health insurer. Here’s a good blog entry on the “millennial patient“.

Why is this relevant to my healthcare communications blog – because segmentation is so key to effective messaging. You have to understand this generation and how to engage them and drive them to take care of their health. Traditional language, modes, techniques, and messages may not work. The article (from the book) talks about their focus on feedback and scoring. They are used to constant [positive] stroking and having a score to evaluate success. They grew up being rewarded for everything. How does that manifest itself in a wellness system that tracks their good deeds (exercise, diet, preventative actions), provides them with rewards, frames their effort as contributing to the greater good, and integrates technology (e.g., connect devices)?

Only 3% of the people they surveyed said that Millenials handled negative feedback well. They haven’t been allowed to fail. This makes me think about one of my favorite quotes from IDEOFail Often To Succeed Sooner. You have to understand how to try, fail, learn, and try again to make improvements.

Here’s some recent research we’d done at Silverlink on the “young invincibles” and “Why I Have Health Insurance”:

Implications of Frugality as the New Black

I have heard some dialogue about consumers freeing up their spending even without their salaries going up or their house value going up (although their portfolio may have recovered by now).  But, the question is how the frugality that was learned in the past year will impact consumers long-term.  Will it change the way they buy?  Will that be true across generations or will this just have a major impact on certain generations that are just coming of age?

An article released by Booz & Company a few weeks ago has some interesting data in it.  For example, in the chart below, it shows 22% of people spending less on healthcare (drugs, supplies).  What does that imply – pill splitting, more generics, more mail order, lower adherence, less preventative care?  So are they more receptive to cost messages from healthcare entities?

Most of the consumers surveyed said they continue to consider saving more important than spending (65 percent). They sacrifice convenience for price (65 percent), frequently use coupons (65 percent), and, to a lesser extent, prefer the best price to the best brand (55 percent).

Maybe it’s time for the PBMs to emphasize convenience more – simplify your life, use mail order…one less errand to run.  I’m still skeptical that this would beat a traditional cost savings message.  BUT, perhaps it’ time to reconsider coupons / incentives.  They’ve been tried with limited upside over the years in pharmacy.  They do drive up results, but they don’t always pay for themselves.  Maybe a lower value incentive would have the same yield thereby increasing ROI. ???

They identify six segments of the population with this frugality filter:

AIS Quote Of The Day – 25 Years Of Health Efforts Wasted


“Other than on cancer, we’ve spent 25 years wasting our time on trying to reduce health risk. I think it’s been a disaster….We weigh more than we did 30 years ago, we exercise less than we did 30 years ago and we have more diabetic people than we did 30 years ago….” 

— Dee Edington, Ph.D., director of the University of Michigan Health Management Research Center, at the recent World Health Care Congress in Washington., D.C. [From today’s quote of the day from AIS]

Should Pharmacy Trend Go Up or Down?

As we enter the “drug trend report” season and we get to see everyone pull out their rules (not always equal) to show that their smaller, a friend asked me a good question the other night.  Is lower trend better?

It’s an interesting discussion.  We always assume that lower trend means the PBM is doing a better job shifting utilization to generics, moving people to mail order, driving specialty claims to the specialty pharmacy, implementing utilization management programs, etc.

BUT, if the PBM improves adherence, the trend’s going to go up.

If the PBM does a better job of moving specialty claims from medical to pharmacy, the trend’s going to go up.

If the PBM does a better job of making sure people get a claim after a step therapy reject, the trend’s going to go up.

If the PBM does a better job of getting people to fill their initial claims, the trend’s going to go up.

If the PBM does a better job of closing gaps in care, the trend’s going to go up.

I think this is one of the big reasons why a captive PBM (i.e., owned by the managed care company) should be viewed differently and has a unique opportunity.  They can make a convincing case that the trend should go up and be offset by lower medical costs.  That’s much harder for a standalone PBM to make.

Why Not Just Give Patients a 365 Day Supply of Generics?

There are certainly some exceptions where the drug is a narcotic or where the drug could be clinically abused.  BUT, in most cases, it probably is the most efficient solution for the market.  The cost of the waste is probably outweighed by the savings.  And, if you’re not a retailer looking for foot traffic, isn’t efficient what matters?  [Not always of course as this flies in the face of my last post on pharmacy as the cornerstone for communications.]

For example:

A – 30-day supply of generic

  • Assume the drug cost is $0.20 per day
  • Assume the cost of filling the drug is $5.00
  • Total cost every 30 days = $11
  • Total annual cost (12 fills) = $132
  • A 365 day supply would save $55 in dispensing costs with only a minor uptick in bottle costs.

B – 90 day supply of generic

  • Assume the drug cost is $0.18 per day
  • Assume the cost of filling the drug is $10.00
  • Total cost every 90 days = $26.20
  • Total annual cost (four 90-day fills) = $104.80
  • A 365 day supply would save $30 in dispensing costs with only a minor uptick in bottle costs and shipping costs.

Especially if you waited until the initial drop in adherence after the first 3-months, you would have less waste.

Why Is Pharmacy So Important For Healthcare Communications?

I’ve talked about pieces of this before, but I really believe that pharmacy is the cornerstone of a successful healthcare communication strategy.

Pharmacy is the most used benefit.  On average people have over 12 pharmacy claims per year.  And, if you take out the people that don’t have any, the number rises to around 20 pharmacy claims per year.

That’s 20 opportunities to intervene at a logical event and educate the patient about their condition, talk to them about saving money, stress the importance of adherence, capture feedback from them, drive them to take an action, etc.

Additionally, pharmacy is a very tangible event that consumers can control.  They get to choose (in most cases) their pharmacy – retail, mail, specialty.  They can talk with physicians about the options – generics versus branded.  It’s a space with lots of DTC (direct-to-consumer) information.

I don’t think most of us (even those in the healthcare field) would feel as open to debating one surgery versus another type or talking about the quality differences between one location and another.  The data’s not as accessible and therefore we’re more dependent upon the system to drive us to good decisions.

Thoughts On Express Scripts 2010 Drug Trend Report

As one of my favorite annual projects during my time at Express Scripts, I love the drug trend report. It has been a historical benchmarking tool for the industry and become a normal deliverable for many of the PBMs. Here are my initial thoughts after reading this year’s document which looks at 2009 data.

Individuals often are not rational.

  • As driven by their Consumerology initiative over the past few years, Express Scripts has shifted the dialogue around the B2C components of the PBM industry to one of behavior change versus simply plan design. This report continues to reinforce that messaging.
  • Waste has been an ongoing drum beat since my days there. This continues to be the message with a shift to include non-adherence to channel mix and drug mix.
  • They talk about the Healthy People 2010 initiative and that key to closing “the last mile” in achieving our objectives is the ability to influence behavior.
  • One of my favorite charts is below showing the waste by class. Not surprising, plan sponsors should focus on heart disease, depression, high cholesterol, and ulcer disease. [Diabetes is not in the top four but is one of the typical areas of focus.]
  • Key Performance Indicators (KPIs):
    • Overall drug trend – 6.4%
    • Specialty drug trend – 19.5%
    • Traditional (non-specialty) drug trend – 4.8%
    • $800.23 PMPY average drug spend
  • The top five classes are:
  • Specialty drug spend is up to $111.10 (processed under the prescription benefit) with a belief that this is only 50% of the total spend which includes specialty drugs processed under the medical benefit.
  • The top specialty classes include inflammatory conditions, MS, and cancer which represent 67% of total specialty spend.
  • I was surprised to see the member contribution to the drug costs had gone down while the actual dollars had stayed flat.
  • I was also surprised that they found adherence (as measured using Medication Possession Ratio) stayed flat from 2008-2009. I think most of the information available had implied thru survey data that it was going down with the recession.
  • I’m having some difficulty reconciling the MPR analysis below with the waste argument. If 80% MPR is ideal and most classes are above 80% MPR, I’m not sure I see the crisis in the data.
  • One of the key charts that I always copied and hung on my wall is the one below. It shows the classes by rank, the utilization, the average cost, and now the estimated behavioral waste (generics and mail).
  • You should certainly go into the document and look at the class level detail. They’ve included a utilization chart by gender by age which I really like. The sections also give some insight into future pipeline. I think I’ll pull diabetes out into a separate post.
  • It’s interesting that they identify only three segments for non-adherent patients with specialty medications versus more on the traditional side:
    • Active Decliner
    • Refill Procrastinator
    • Sporadic Forgetter
  • They project that utilization will continue to go up at about 3% per year and that trend will be mitigated with new generics coming to market.
  • Another interesting analysis is where the waste is by state:
  • They have some information on their Consumerology approach, but I’ve talked about that before.
  • I liked their simple plan design primer:
  • Towards the end, they talk about some of the changes they’ve made over the past few years to their programs to reflect their consumerism approach:
    • Step Therapy Choice
    • Formulary Rapid Response
    • Call4Generics
    • Select Home Delivery (which is gem of their new programs in my assessment)
    • First Generic Fill Free
    • Select Curascript
  • A simple graphic that points to the importance of understanding the consumer and developing programs to effectively drive behavior is below. [This is very similar to all the work we do at Silverlink with clients to help them drive health outcomes and behavior.]

I like it. Very humanized versus purely statistical document. Good job Emily, Steve, Yakov, Andy, Bob, Brian, and Chris. (That’s the core group that I know well.)

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